WILLMAR -- Can the uniquely American concept of the value-added cooperative be adapted to help Japan develop energy self-sufficiency?
Two Japanese researchers visited Willmar this week to gather information on how value-added cooperatives are structured and how they operate.
It's their hope to eventually write a paper that will be presented to the Diet, the Japanese law-making body, and spark legislation and policy change to encourage the development of biofuels.
"We need to introduce this kind of idea into our own society," said Dr. Tetsuo Ohe, an associate professor in agriculture at Meiji University in Tokyo.
He and Dr. Hisashi Bannai, a senior researcher at the Rural Financial Research Institute of Tokyo, spent more than two hours gaining an overview of cooperative and partnership business structures from John Christianson.
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Christianson, a certified public accountant, is a principal with the Willmar accounting firm of Christianson and Associates, which specializes in consulting for renewable energy projects.
The renewable energy movement in Japan is still in its infancy, Ohe and Bannai said. The country imports most of its oil from the Middle East but has begun looking at ways to become less reliant on overseas energy sources.
The two researchers said they believe there's potential in Japan for home-grown biofuel.
The most likely source would be rice straw, from which the starch can be fermented and turned into a form of ethanol.
If Japanese farmers could create their own cooperatives to manufacture ethanol from rice straw, the country could import less ethanol from other nations and give a boost to the farming economy as well, Ohe and Bannai said.
Eighty to 90 percent of the farms in Japan are small and family-owned, however, and they don't possess much political clout, Ohe said.
"We need to start some new business -- a value-added plant or value-added activities to increase the income of farmers," he said.
One of the biggest barriers likely will be access to capital, Christianson said.
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"That's going to be a difficult task for them," he said. "With a value-added cooperative, they need to put cash in and make an investment to buy stock. It's pretty difficult for a small number of farmers to establish new plants by themselves."
Christianson led the Japanese researchers through an explanation of the business structure and the pros and cons of cooperatives, limited liability companies, limited partnerships and traditional corporations.
He gave them a detailed timeline that outlined all the steps required in the U.S. for organizing a cooperative to produce ethanol.
This is the fifth time Ohe and Bannai have traveled to the United States to study agricultural cooperatives. Most of their research has been done in the Upper Midwest. Their visit this past week also included a two-day trip to Canada, as well as meetings at the Minnesota Department of Agriculture and at the headquarters of Land-O-Lakes.
"First of all we must know exactly the whole picture of this concept. After that, maybe we can try to change this concept to adapt it into Japanese society," Ohe said.
It's a long-term project that will require considerable public education before there can be enough support to bring about change, he explained.
"That is a role we must play after going back to Japan," he said.
