Through the application of economic theory, this paper analyzes the development and functions of cooperatives in specialty crop industries. Issues discussed include: why cooperatives form

the different kinds of cooperatives

the benefits and limitations of agricultural cooperation

the keys to a successful agricultural cooperative

and current and future issues that will influence the growth of cooperatives in agricultural industries. This discussion focuses on the formation and development of agricultural cooperatives in specialty crop industries because, due to the relatively small size of these industries and the often highly perishable nature of their crop, specialty crop producers frequently face difficult market conditions. Adverse circumstances such as extremely low product prices or insufficient market outlets often prompt the development of cooperatives in these industries. This paper addresses issues relating to specialty crops in general and applies them specifically to two specialty crop industries, the tart cherry industry and the farm-raised catfish industry. The formation and functions of cooperatives in these two agricultural industries are presented. Different cooperatives in the tart cherry and farm-raised catfish industries then are described and their benefits, limitations, and success rates are discussed. These two specialty crops represent industries at different stages of growth

the tart cherry industry is a well-established, mature market, while the catfish industry is relatively new--it's initial growth having only recently slowed down. This discussion of cooperatives in specialty crop industries and the case studies of the tart cherry and farm-raised catfish industries should assist participants in other specialty crop industries at every stage of growth to understand the development and roles of cooperatives in their industry.