Cooperatives as an economic model in Turkey sugar market: Agriculture – industry integration and Pankobirlik review

Cooperative organizations, which will be referred shortly as cooperations, are defined as economic units in which individuals knowingly and voluntarily create an organization to collaborate particularly to improve their economic benefits. Within the market mechanism, cooperations aim to improve their competitive advantages in the provision and sales of goods, as well as to regulate the market structure and market mechanism. The first part of this thesis analyzes the economic role of cooperations and in general cooperative organizational structure. The second part of the thesis focuses on a successful Turkish cooperation which has a predominant high level organization structure and is capable of regulating the overall market mechanism. For the latter part, this thesis specifically focuses on a Beetroot Cooperation (referred as Pancar Kooperatifleri in Turkish), which, for the case of Turkey, has a vertical organizational structure incorporating sugar refineries in line with the legal regulations within the sugar sector. This thesis shows that, one of the key elements in the success of the Beetroot Cooperation is its organizational structure which enables agricultural input provision to the sector and an effective use of products within the sector and across other sectors. This organizational structure leads to improved investment opportunities where sustainability of production is ensured. One of the main contritions of this thesis is the analysis of the role of Beetroot Cooperation's organizational structure in their success in a nation-wide and worldwide comparative setting. Thus, the findings shed light to potential organizational improvements in the sugar market as well as other markets, particularly markets with large scale cooperative organizations. In addition to the above-mentioned motivation, a comparative study of the sugar market and cooperative organizations within this market is important since the sugar sector a predominantly high volume sector and it is one of the mostly regulated markets worldwide. Production levels, tariffs and trade agreements in the sugar sector are restricted with regulations in many countries. First, a detailed analysis of this sector is relevant for sugar market regulations worldwide. Second, due to the strong ties with other markets, adopted cooperation policies for sustainable production in this sector has potential benefits on other agricultural sectors. Third, for the case of Turkey, two other providers within the sugar sector, namely the private and public sector, will potentially benefit from the analysis of success in Beetroot Cooperation since these providers produce contemporaneous and similar products.