Dairy Giant ÖR-KOOP Files for Bankruptcy Protection Amid Heavy Debt Burden

October 29, 2026 · Tarım Dünyası

ÖR-KOOP, a 47-year-old producer cooperative with over 4,000 members in Aydın, has obtained a provisional moratorium from the court due to a debt burden of 431 million Turkish Lira and blocked financing channels.

Financial Crisis at Historic Dairy Giant

Nazilli and its Surroundings Agricultural Development Cooperative (ÖR-KOOP), operating since 1979 in Aydın's Nazilli district and holding a first-degree organization certificate from the Ministry of Agriculture and Forestry, has filed for bankruptcy protection due to its financial difficulties. The court granted a provisional moratorium until October 21, 2026, and appointed a bankruptcy trustee for the giant structure, which includes over 4,000 producer members from Aydın and surrounding districts. The ÖR-KOOP Board of Directors, in a statement regarding the legal aspects and objectives of the process, announced their intention to secure the cooperative's future with the following words:

'ÖR-KOOP, which has contributed to the agricultural production and economy of our region since 1979 and has over 4,000 producer members, is not just a business; it represents the labor of thousands of producer families, the economic power of the region, and a shared value of 47 years: A bankruptcy protection application has been filed to overcome the financial difficulties our cooperative is facing and to establish a sustainable operational structure. Following our application, a provisional moratorium was granted by the court on October 21, 2026, and a bankruptcy trustee was appointed. For the sake of informing the public accurately, we specifically wish to state that the bankruptcy protection process is a legal procedure initiated to enable our cooperative to continue its operations and to fulfill its obligations by restructuring its debts. The core of this process is the will to protect the future of our cooperative and the rights of our creditors.'

Heavy Debt Burden Inherited from the Past

According to official data shared with the public by the cooperative's management, the institution had a debt stock of 431 million Turkish Lira in its coffers when the current board, led by Çetin Kapucu, took office on July 27, 2025. The fact that all real estate was mortgaged and subject to various encumbrances completely blocked fundamental financial maneuvering options, such as real estate sales, that the new management wanted to implement to overcome the crisis. Highlighting the severity of the situation, the ÖR-KOOP Board of Directors described the inherited financial picture with the following statements:

'At that time, there was a bank loan debt of 190 million TL, a check liability of 151 million TL not yet due, and approximately 90 million TL in debts to our producers. Therefore, we took over a total debt burden of 431 Million TL. Due to all the real estate owned by the cooperative being mortgaged and some having lease annotations, we found our hands tied in this regard.'

Unresolved Leasing Obstacle at the Feed Mill

The leasing of the feed mill, one of the cooperative's most critical assets producing since 2017, for 15 years in a previous period became a primary factor deepening the financial crisis. Due to this contractual obligation on the facility, its ownership could not be converted into cash. Cooperative members also stated that there are still 2 years left until the lease expires, and if these obstacles were not present, a significant portion of the debts could have been quickly settled through sales. Sharing details on the matter, the ÖR-KOOP Board of Directors summarized the restriction they encountered with the following words:

'The right to lease was annotated on the title deed. The fact that three years of rent had been collected in advance also meant that we were deprived of the opportunity to effectively utilize the facility in the process of exiting the crisis. In other words, although our cooperative had a significant production facility, our ability to benefit from this facility to strengthen our financial structure was eliminated.'

Financing Burden and Restructuring Stalemate

The board of directors stated that after taking office, they mobilized personal resources, making check payments totaling 107 million TL in the first two months and reducing bank debts to 176 million TL. However, the surge in financing expenses to 220 million TL over the last five years, and 97 million TL in 2025 alone, disrupted the cash balance. Addressing the negotiations with banks, the ÖR-KOOP Board of Directors expressed the deadlock with the following statements:

'Despite all the adverse circumstances we faced, as the board of directors, we made intensive efforts to fulfill our cooperative's obligations and improve its financial structure. By mobilizing our personal financial resources, we made check payments totaling 107 million TL in the first two months and reduced bank loan debts to 176 million TL. However, the increase in our cooperative's financing expenses to 220 million TL over the last five years, and 97 million TL in financing expenses in 2025 alone, has exacerbated the pressure on the financial structure. Despite offering real estate collateral twice the amount of our current debt for the restructuring of bank loans, the negotiations did not yield the expected results.'

The board of directors stated that after 15 months of intensive effort, the bankruptcy protection application became an unavoidable legal necessity, explaining the reason for the decision as follows:

'We consider this decision not to evade obligations, but as a legal step taken to re-establish a strong cooperative structure capable of fulfilling our obligations and continuing our responsibilities to our producers.'

Protecting Producer Rights and Objectives

The cooperative management stated that their goal is to fully pay the receivables of farmers who deliver raw milk under the pre-bankruptcy project, and they have referred all identified irregularities from the past period to the judiciary. The institution aims to re-establish producer confidence by operating its modern milk processing facilities in Nazilli center and its 2,000 square meter closed cold storage facility, which became operational in November 2019, at full capacity. Emphasizing the sensitivity of the process, the ÖR-KOOP Board of Directors shared their commitments to producers with the following words:

'We respectfully inform the public that we will follow up on these processes until their conclusion and continue to show the necessary sensitivity in protecting the rights of our cooperative and our producer members. We are aware that the recent developments are causing concern among our producers and members. We know that you want to receive timely payment for your labor and to continue your production with confidence. Therefore, our priorities are clear: – To ensure the continuation of our cooperative's operations, – To establish a regular payment system for new milk deliveries, – To pay past producer receivables within a fair plan. In the pre-bankruptcy project we have prepared, we aim to pay all producer receivables in full. Towards this goal, we will work to strengthen our cooperative's financial structure by fulfilling the requirements of the legal process. The labor of our producers, the trust of our members, and the agricultural future of our region are of great importance to us. We are acting with the awareness of this responsibility; we expect the constructive support of our producers, financial institutions, public institutions, and all representatives of our region.'

The ÖR-KOOP Board of Directors emphasized the commitment to collective struggle with the following sentences, underlining the goal of strengthening the financial structure:

'Our aim is not to escape our debts, but to revive a strong cooperative capable of fulfilling all our obligations: The survival of ÖR-KOOP does not just mean the continuation of a business's operations. It means protecting the labor of thousands of producer families, the future of the regional economy, and agricultural production. We are determined to protect the labor of our producers, the trust of our members, and the future of our region.'

Milk Powder Crisis and Marketing

According to information shared by cooperative members, approximately 100 tons of milk powder produced by the cooperative under the raw milk regulation could not find buyers in the market and locked up working capital. As payments for raw milk deliveries were delayed due to the unsold milk powder, farmers gradually reduced the amount of raw milk they supplied to the cooperative. The decrease in raw milk flow lowered the capacity utilization rates at the factory, paving the way for the cooperative's inability to service both bank loans and producer balances. The market demand bottleneck quickly plunged the revenue balance of facilities producing dairy products into crisis.

Heavy Impact on Regional Agricultural Economy

Expressing the difficulties faced by producers in the region, Cooperative Member Producers drew attention to the cash crunch in rural areas and the need for debt deferral, describing the situation with the following words:

'Producers are not making money from any of the grains, olives, cotton, vegetables, or fruits. They are trying to pay their debts with the milk they sell. If they cannot receive milk payments from the cooperative, they will not be able to pay their bank debts. This chain reaction will affect every segment of the sector. Therefore, loan debts must be deferred.'

Producers, stating that high input costs and low product price pressure in the agricultural sector have left them desperate, demanded an urgent deferral of agricultural loan debts. It was noted that ÖR-KOOP's continued production is vital for all farming families in the region to prevent a regional disaster.

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