Vol. 15 No. 2 (2026)
Short Communications

The cost of joining forces: collective organisations and the economic performance of dairy farms in South West England

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  • Paolo Nota,
  • Daniele Curzi,
  • Mauro Vigani
Paolo Nota
Department of Environmental Science and Policy, University of Milan, Italy
Daniele Curzi
Department of Environmental Science and Policy, University of Milan, Italy
Mauro Vigani
European Commission, Directorate-General for Agriculture and Rural Development (DG AGRI), Brussels, Belgium
DOI: https://doi.org/10.36253/bae-17342

Published 2025-09-16

Keywords

  • dairy farming,
  • collective organisations,
  • markup,
  • coarsened exact matching

How to Cite

Nota, P., Curzi, D., & Vigani, M. (2025). The cost of joining forces: collective organisations and the economic performance of dairy farms in South West England. Bio-Based and Applied Economics, 15(2), 89–94. https://doi.org/10.36253/bae-17342

Copyright (c) 2026 Paolo Nota, Daniele Curzi, Mauro Vigani

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

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Abstract

This note highlights the importance of sale agreements for the economic performance of dairy farms in South West England. The reduction in public intervention in milk supply governance led to market coordination through supply chain agreements (SCAs), resulting in unbalanced power dynamics that reduced farmers’ bargaining power and made them vulnerable to unfair practices. Collective organisations are seen as a solution to protect farmers. Using Coarsened Exact Matching, the paper estimates the effect of collective organisation participation on selling prices, production costs, and markup in a sample of 200 farms in Somerset and Devon. The results show that collective organisations are associated with 7.3% higher production costs and 23 percentage points lower markup, mainly due to costs associated with milk collection, transport, storage, marketing, and adherence to strict quality standards. However, these costs are counterbalanced by secured market access, stronger negotiating power, and better alignment with market demand. These findings underscore the need to further investigate collective governance in developed agricultural markets.

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