That’s a great question.
I don’t think the co-op would necessarily have to own (or lease) all the land itself; that isn’t realistic, as you pointed out, especially if a co-op is going to be formed out of a bunch of existing farmers instead of new farmers.
Take my case, for example. I’ll have access to 5,000+ acres which will be great for bringing in new farmers, or existing farmers who maybe want to divest some of their existing leases, or even expand their operations onto co-op land. But it’s fine for farmers to have and keep their own properties.
The co-op’s possession of land is important for my particular co-op since we’re focusing on bringing in new farmers who don’t already have it, but beyond that, the co-op’s critical offerings are collective purchasing and marketing, “employee” benefits like insurance and salaries, shared labor, and centralized operations management (e.g. bookkeeping, inventory, etc.)