Leading UN agencies have claimed that agricultural cooperatives offer smallholder farmers greater benefits that they could not achieve individually. The UN Food and Agriculture Organization (FAO), the International Fund for Agricultural Development (IFAD) and the World Food Program (WFP) said it at the launch of the International Year of Cooperatives 2012 (IYC) in New York.

According to the UN agencies, smallholder farmers gain big benefits from agricultural cooperatives including bargaining power and resource sharing that lead to food security and poverty reduction for millions.

According to the FAO, IFAD and WFP, empowered by being part of a large group, smallholder farmers can negotiate better terms in contract farming and lower prices for agricultural inputs like seeds, fertilizer and equipment. In addition, cooperatives offer prospects that smallholder farmers would not be able to achieve individually such as helping them to secure land rights and better market opportunities.

Producer cooperatives offer men and women smallholders market opportunities, and provide them with services such as better training in natural resource management, and better access to information, technologies, innovations and extension services. In several countries, FAO provides quality seeds and fertilizers to farmers and agricultural cooperatives and works with them in applying more suitable and productive farming practices.

IFAD works with local agricultural cooperatives in Nepal on goat resource centers that help farmers develop markets for a sustainable supply of high-quality breeding goats. Under the Purchase for Progress (P4P) pilot initiative, WFP and partners are working with smallholder farmers' organizations in 21 countries to help them produce surpluses, gain access to markets and increase their incomes.

The three UN agencies will promote the growth of agricultural cooperatives by carrying out initiatives to better understand cooperatives and assess their socio-economic development impact, and to raise awareness of their role and impact on the lives of men and women smallholder farmers. One example would be the FAO's database of good practices in institutional innovations.

Also the UN bodies supports cooperatives to form networks through which smallholder producers can pool their assets and competencies to overcome market barriers and other constraints such as a lack of access to natural resources. Also they assist policy-makers in the design and implementation of policies, laws, regulations and projects that take into consideration the needs and concerns of both men and women smallholder farmers and create enabling environment for agricultural cooperatives to thrive

The three organizations belief in strengthening the dialogue and cooperation between governments, agricultural cooperatives, the international research community and civil society representatives on analyzing the best conditions for cooperatives worldwide to develop.

In rural areas agriculture, including farming, forestry, fisheries, and livestock, is the main source of employment and income. Therefore, agricultural cooperatives play an important role in supporting men and women small agricultural producers and marginalized groups by creating sustainable rural employment. In Brazil, cooperatives were responsible for 37.2 percent of agricultural GDP and 5.4 percent of overall GDP in 2009, and earned about US$3.6 billion from exports. In Mauritius, cooperatives account for more than 60 percent of national production in the food crop sector and in Kenya the savings and credit cooperatives have assets worth US$2.7 billion, which account for 31 percent of gross national savings.