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                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549


                                    Form 10-Q


          Quarterly Report under Section 13 or 15(d) of the Securities
                              Exchange Act of 1934

   (Mark One)
           [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                For the quarterly period ended September 27, 1997

                                       OR

          [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                        For the transition period from to

                               File Number 0-20539

                            PRO-FAC COOPERATIVE, INC.
             (Exact Name of Registrant as Specified in its Charter)

                               New York 16-6036816
                  (State or other jurisdiction of (IRS Employer
              incorporation or organization Identification Number)

                90 Linden Place, PO Box 682, Rochester, NY 14603
               (Address of Principal Executive Offices) (Zip Code)

        Registrant's Telephone Number, Including Area Code (716) 383-1850

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding  twelve  months (or such shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.

                                    YES X NO

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock as of October 10, 1997.

                            Common Stock - 1,749,580










                          PART I. FINANCIAL INFORMATION

ITEM I.  FINANCIAL STATEMENTS


Pro-Fac Cooperative, Inc.
Consolidated Statement of Operations and Net Proceeds

(Dollars in Thousands)


                                                                                                                    Quarter Ended
                                                                                               September 27,         September 28,
                                                                                                      1997                  1996

                                                                                                                       
Net sales                                                                                         $176,397              $174,000
Cost of sales                                                                                      130,748               132,309
                                                                                                  --------              --------
Gross profit                                                                                        45,649                41,691
Selling, administrative, and general expense                                                       (32,758)              (32,916)
                                                                                                  --------              --------
Operating income                                                                                    12,891                 8,775
Interest expense                                                                                    (7,770)               (9,881)
                                                                                                  --------              --------
Income/(loss) before taxes, dividends, allocation of net proceeds, and
   cumulative effect of an accounting change                                                         5,121                (1,106)
Tax provision                                                                                       (1,822)                 (527)
                                                                                                  --------              --------
Income/(loss) before cumulative effect of an accounting change,
   dividends, and allocation of net proceeds                                                      $  3,299                (1,633)
Cumulative effect of an accounting change                                                                0                 4,516
                                                                                                  --------              --------
Net income                                                                                        $  3,299              $  2,883
                                                                                                  ========              ========

Allocation of Net Proceeds:
   Net income                                                                                     $  3,299              $  2,883
   Dividends on common and preferred stock                                                          (1,850)               (1,335)
                                                                                                  --------              --------
   Net proceeds                                                                                      1,449                 1,548
   Allocation to earned surplus                                                                       (788)               (1,035)
                                                                                                  --------              --------
   Net proceeds available to members                                                              $    661              $    513
                                                                                                  ========              ========

Net Proceeds Available to Members:
   Estimated cash payment                                                                         $    165              $    103
   Qualified retains                                                                                   496                   410
                                                                                                  --------              --------
   Net proceeds available to members                                                              $    661              $    513
                                                                                                  ========              ========

<FN>
The  accompanying  notes are an integral  part of these  consolidated  financial
statements.
</FN>



Pro-Fac Cooperative, Inc.
Consolidated Balance Sheet

(Dollars in Thousands)                                                                     September 27,    June 28,  September 28,
                                                                                               1997           1997        1996
                                     ASSETS
                                                                                                          
Current assets:
   Cash and cash equivalents                                                                $  3,997        $  2,838     $  6,682
   Accounts receivable, trade, net                                                            65,053          48,661       62,020
   Accounts receivable, other                                                                  3,845           2,795        6,268
   Inventories -
     Finished goods                                                                          140,056          87,904      158,474
     Raw materials and supplies                                                               28,396          27,001       35,161
                                                                                            --------        --------     --------
           Total inventories                                                                 168,452         114,905      193,635
                                                                                            --------        --------     --------
   Prepaid manufacturing expense                                                                   0           8,265        1,111
   Prepaid expenses and other current assets                                                   8,464           6,323        8,742
   Current deferred tax assets                                                                12,312          12,312       13,731
   Current investment in Bank                                                                    631             946            0
                                                                                            ---------       --------     ---------
           Total current assets                                                              262,754         197,045      292,189
Investment in Bank                                                                            24,320          24,321       24,439
Investment in Great Lakes Kraut Company                                                        6,585               0            0
Property, plant, and equipment, net                                                          209,216         217,923      269,254
Assets held for sale                                                                           3,259           3,259        5,113
Goodwill and other intangible assets, net                                                     95,503          96,429      102,734
Other assets                                                                                   7,525           7,700       12,550
                                                                                            --------        --------     ---------
           Total assets                                                                     $609,162        $546,677     $706,279
                      LIABILITIES AND SHAREHOLDERS' AND MEMBERS' CAPITALIZATION             ========        ========     ========

Current liabilities:
   Notes payable                                                                            $ 64,000        $      0     $ 63,000
   Current portion of obligations under capital leases                                           558             558          548
   Current portion of long-term debt                                                           8,073           8,075        8,075
   Accounts payable                                                                           39,175          49,256       46,188
   Income taxes payable                                                                        5,386           5,672        3,961
   Accrued interest                                                                            3,960           8,663        4,767
   Accrued employee compensation                                                               7,981          11,063        8,143
   Accrued manufacturing expense                                                               2,899               0            0
   Other accrued expenses                                                                     21,681          21,956       27,554
   Dividends payable                                                                               0              61            0
   Amounts due members                                                                        27,808          15,791       27,051
                                                                                            --------        --------     --------
           Total current liabilities                                                         181,521         121,095      189,287
Long-term debt                                                                                70,528          69,829      162,164
Senior subordinated notes                                                                    160,000         160,000      160,000
Obligations under capital leases                                                                 817             817        1,125
Deferred income tax liabilities                                                               39,591          39,591       44,753
Other non-current liabilities                                                                 22,962          22,682       20,713
                                                                                            --------        --------     --------
           Total liabilities                                                                 475,419         414,014      578,042
                                                                                            --------        --------     --------
Commitments and contingencies
Class B cumulative  redeemable  preferred stock  liquidation  preference $10 per
   share, authorized - 500,000 shares; issued
     and outstanding 31,435, 31,435, and 33,364 shares, respectively                             314             315          334
Common stock, par value $5, authorized - 5,000,000 shares
                                                    September 27,   June 28,   September 28,
                                                        1997          1997          1996

Shares issued                                        1,749,580      1,788,815    1,855,329
Shares subscribed                                       44,808         54,557       57,859
                                                     ---------      ---------    ---------
           Total subscribed and issued               1,794,388      1,843,372    1,913,188
Less subscriptions receivable in installments          (44,808)       (54,557)     (57,859)
                                                     ---------      ---------    ---------
                                                     1,749,580      1,788,815    1,855,329     8,748           8,944        9,277
                                                     =========      =========    =========
Shareholders' and members' capitalization:
   Retained earnings allocated to members                                                     32,409          31,920       32,728
   Non-qualified allocation to members                                                         2,960           2,960        3,275
   Non-cumulative preferred stock, par value $25; authorized - 5,000,000 shares;
     issued and outstanding - 53,797,
       53,797, and 105,788, respectively                                                       1,345           1,345        2,645
   Class A cumulative preferred stock, liquidation preference
     $25 per share; authorized - 49,500,000 shares; issued and
       outstanding 3,215,709, 3,215,709 and 3,032,704 shares,
          respectively                                                                        80,393          80,393       75,818
   Earned surplus                                                                              7,574           6,786        4,160
                                                                                            --------        --------     --------
           Total shareholders' and members' capitalization                                   124,681         123,404      118,626
                                                                                            --------        --------     --------
           Total liabilities and capitalization                                             $609,162        $546,677     $706,279
                                                                                            ========        ========     ========
<FN>
The  accompanying  notes are an integral  part of these  consolidated  financial statements.
</FN>



Pro-Fac Cooperative Inc.
Consolidated Statement of Cash Flows

(Dollars in Thousands)

                                                                                                           Quarter Ended
                                                                                                    September 27,     September 28,
                                                                                                           1997                1996
                                                                                                   ------------------- -----------
                                                                                                                        
Cash flows from operating activities:
   Net income                                                                                         $   3,299         $   2,883
   Amounts payable to members                                                                              (165)             (103)

   Adjustments  to  reconcile  net  income  to net cash  provided  by  operating
activities:
     Cumulative effect of an accounting change                                                                0            (4,516)
     Amortization of goodwill and other intangibles                                                         990             1,093
     Amortization of debt issue costs                                                                       199               200
     Depreciation                                                                                         4,597             6,135
     Change in assets and liabilities:
       Accounts receivable                                                                              (17,442)          (14,215)
       Inventories                                                                                      (55,722)          (63,061)
       Accounts payable and accrued expenses                                                             (6,976)             (629)
       Amounts due to members                                                                            12,017            19,176
       Federal and state taxes refundable                                                                  (286)              471
       Other assets and liabilities                                                                      (2,463)           (2,236)
                                                                                                      ---------         ---------
Net cash used in operating activities                                                                   (61,952)          (54,802)
                                                                                                      ---------         ---------

Cash flows from investing activities:
   Purchase of property, plant, and equipment                                                            (3,231)           (3,920)
   Disposals of property, plant, and equipment                                                              375               293
   Proceeds from investment in CoBank                                                                       316                 0
                                                                                                      ---------         ---------
Net cash used in investing activities                                                                    (2,540)           (3,627)
                                                                                                      ---------         ---------

Cash flows from financing activities:
   Proceeds from short-term debt                                                                         64,000            63,000
   Proceeds from long-term debt                                                                           2,000                 0
   Proceeds from Great Lakes Kraut Company                                                                3,000                 0
   Payments on long-term debt                                                                            (1,303)           (5,519)
   (Repurchases)/issuances of common stock                                                                 (196)               92
   Cash dividends paid                                                                                   (1,850)           (1,335)
                                                                                                      ---------         ---------
Net cash provided by financing activities                                                                65,651            56,238
                                                                                                      ---------         ---------
Net change in cash and cash equivalents                                                                   1,159            (2,191)
Cash and cash equivalents at beginning of period                                                          2,838             8,873
                                                                                                      ---------         ---------
Cash and cash equivalents at end of period                                                            $   3,997         $   6,682
                                                                                                      =========         =========

Supplemental Disclosure of Cash Flow Information:

Investment in Great Lakes Kraut Company
   Inventories                                                                                        $   2,175
   Prepaid expenses and other current assets                                                                409
   Property, plant, and equipment                                                                         6,966
   Other accrued expenses                                                                                   (62)
                                                                                                      ---------
                                                                                                      $   9,488
                                                                                                      =========
<FN>
The  accompanying  notes are an integral  part of these  consolidated  financial
statements.
</FN>






                            PRO-FAC COOPERATIVE, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1.       SUMMARY OF ACCOUNTING POLICIES

The accompanying  unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting  principles and, in the opinion
of management,  include all  adjustments  (consisting  only of normal  recurring
adjustments)  necessary for a fair presentation of the results of operations for
these periods.  The following  summarizes the  significant  accounting  policies
applied in the  preparation  of the  accompanying  financial  statements.  These
financial statements should be read in conjunction with the financial statements
and  accompanying  notes  contained in  Pro-Fac's  Form 10-K for the fiscal year
ended June 28, 1997.

Consolidation: The consolidated financial statements include the Cooperative and
its wholly-owned subsidiary,  Agrilink Foods, Inc. ("Agrilink" or "the Company")
after  elimination  of  intercompany  transactions  and  balances.  Agrilink was
formerly known as Curtice Burns Foods, Inc. (see NOTE 3 - "Other Matters").

Change in Accounting  Principle:  Effective June 30, 1996, accounting procedures
were  changed  to  include  in  prepaid   expenses  and  other  current  assets,
manufacturing spare parts previously charged directly to expense.  The favorable
cumulative  effect of the change (net of income taxes of $1.2  million) was $4.5
million. Pro forma amounts for the cumulative effect of the accounting change on
prior periods are not determinable due to the lack of physical  inventory counts
required to establish quantities at the respective dates.

NOTE 2.       AGREEMENTS WITH AGRILINK

The  contractual  relationship  between  Agrilink  and Pro-Fac is defined in the
Pro-Fac Marketing and Facilitation Agreement ("Agreement"). Under the Agreement,
the Company  pays  Pro-Fac the  commercial  market  value  ("CMV") for all crops
supplied by Pro-Fac.  CMV is defined as the weighted average price paid by other
commercial  processors for similar crops sold under  preseason  contracts and in
the open market in the same or competing  market area.  Although CMV is intended
to be no more than the fair market value of the crops purchased by Agrilink,  it
may be more or less than the price  Agrilink would pay in the open market in the
absence of the Agreement.

Under the  Agreement  the Company is required to have on its board of  directors
some  persons  who  are  neither   members  of  nor   affiliated   with  Pro-Fac
("Disinterested Directors"). The number of Disinterested Directors must at least
equal the number of directors who are members of Pro-Fac. The volume and type of
crops to be purchased by Agrilink under the Agreement are determined pursuant to
its annual  profit  plan,  which  requires  the  approval  of a majority  of the
Disinterested  Directors.  In  addition,  in any year in which the  Company  has
earnings  on  products  which  were  processed  from crops  supplied  by Pro-Fac
("Pro-Fac  Products"),  the  Company  pays to  Pro-Fac  up to 90 percent of such
earnings,  but in no case more than 50 percent of all  pretax  earnings  (before
dividing with Pro-Fac) of the Company.  In years in which the Company has losses
on Pro-Fac  Products,  the  Company  reduces the CMV it would  otherwise  pay to
Pro-Fac  by up to 90  percent  of such  losses,  but in no case by more  than 50
percent of all pretax  losses  (before  dividing  with  Pro-Fac) of the Company.
Additional  patronage  income  is paid  to  Pro-Fac  for  services  provided  to
Agrilink,  including the provision of a long term, stable crop supply, favorable
payment terms for crops and the sharing of risks of losses of certain operations
of the  business.  Earnings and losses are  determined  at the end of the fiscal
year, but are accrued on an estimated basis during the year. Under the Indenture
related to the  Company's  Senior  Subordinated  Notes,  Pro-Fac is  required to
reinvest at least 70 percent of the additional Patronage income in Agrilink.

NOTE 3.       OTHER MATTERS

Name Change: On September 18, 1997, the Cooperative's  wholly-owned  subsidiary,
Curtice Burns Foods,  Inc.  changed its name to Agrilink  Foods,  Inc. The three
recently  consolidated  business  units of Agrilink,  Comstock  Michigan  Fruit,
Southern Frozen Foods, and Brooks Foods, are now called Curtice Burns Foods.

Formation of New  Sauerkraut  Company:  Effective  July 1, 1997, the Company and
Flanagan Brothers, Inc. of Bear Creek,  Wisconsin,  contributed all their assets
involved in sauerkraut  production to form a new  sauerkraut  company.  This new
company,  Great Lakes Kraut  Company,  operates as a New York limited  liability
company, with ownership split between the two companies. Management believes the
alliance will positively impact earnings.

Dividends:  Subsequent to quarter end, the Cooperative  declared a cash dividend
of $.43 per share on the Class A Cumulative  Preferred  Stock.  These  dividends
approximate $1.4 million and will be paid on October 31, 1997.






ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

The purpose of this review is to highlight the more  significant  changes in the
major items in  Consolidated  Statement  of  Operations  and Net Proceeds in the
first quarter of fiscal 1998 versus the first quarter of 1997.

                         PRO-FAC'S RESULTS OF OPERATIONS

Pro-Fac  Cooperative,  Inc.'s  ("Pro-Fac"  or  the  "Cooperative")  wholly-owned
subsidiary,  Agrilink has three  primary  business  units:  Curtice  Burns Foods
("CBF"), Nalley Fine Foods, and its Snack Foods group. Each business unit offers
different  products  and is  managed  separately.  The  majority  of each of the
business units' net sales are within the United States. In addition,  all of the
Company's operating facilities are within the United States.

The CBF business unit produces  products in several food  categories,  including
fruit fillings and toppings;  aseptically-produced  products;  canned and frozen
fruits and  vegetables,  and popcorn.  The Nalley  business unit produces canned
meat  products  such as chilies  and stews,  pickles,  salad  dressings,  peanut
butter,  and syrup.  The  Company's  snack foods  business  unit consists of the
Snyder of Berlin,  Husman Snack Foods, and Tim's Cascade Potato Chip businesses.
This business unit produces and markets potato chips and other snack items.

The following  tables  illustrate the results of operations by business unit for
the quarters  ended  September 27, 1997 and  September  28, 1996,  and the total
assets by business unit as of September 27, 1997 and September 28, 1996.


Net Sales

(Dollars in Millions)
                                                                               Quarter Ended
                                                                 September 27,              September 28,
                                                                     1997                        1996
                                                                         % of                        % of
                                                                $        Total             $         Total
                                                             ------     -------         ------       ------

                                                                                           
         CBF                                                 $112.2       63.6%         $ 99.2        57.0%
         Nalley Fine Foods                                     46.9       26.6            44.2        25.4
         Snack Foods Group                                     17.3        9.8            17.2         9.9
                                                             ------      -----          ------       -----
           Subtotal ongoing operations                        176.4      100.0           160.6        92.3
         Businesses sold1                                       0.0        0.0            13.4         7.7
                                                             ------      ------          -----       ------
           Total                                             $176.4      100.0%         $174.0       100.0%
                                                             ======      =====          ======       =====

<FN>
1   Includes the activity of Finger Lakes Packaging and the portion of the canned vegetable business sold in fiscal 1997.
</FN>


Operating Income

(Dollars in Millions)
                                                                             Quarter Ended
                                                               September 27,               September 28,
                                                                    1997                       19961
                                                                        % of                           % of
                                                                $       Total             $            Total
                                                             ------    --------         -----          ------

                                                                                              
         CBF                                                 $ 9.0        69.8%         $ 6.4           72.7%
         Nalley Fine Foods                                     3.7        28.7            2.1           23.9
         Snack Foods Group                                     2.1        16.2            1.5           17.0
         Corporate                                            (1.9)      (14.7)          (1.7)         (19.3)
                                                             -----       -----          -----          -----
           Subtotal ongoing operations                        12.9       100.0            8.3           94.3
         Businesses sold2                                      0.0         0.0            0.5            5.7
                                                             -----       -----          -----          -----
           Total                                             $12.9       100.0%         $ 8.8          100.0%
                                                             =====       =====          =====          =====

<FN>
1   Excludes  cumulative  effect of an  accounting  change for the  quarter  ended  September  28,  1996.  See NOTE 1 - "Summary  of
    Accounting Policies - Change in Accounting Principle."

2   Includes the activity of Finger Lakes Packaging and the portion of the canned vegetable business sold in fiscal 1997.
</FN>







EBITDA1

(Dollars in Millions)

                                                                            Quarter Ended
                                                                  September 27,          September 28,
                                                                       1997                  19962
                                                                          % of                     % of
                                                               $          Total          $         Total
                                                             -----        -----       ------      ------

                                                                                         
         CBF                                                 $12.7         68.6%       $10.6       66.3%
         Nalley Fine Foods                                     5.1         27.6          3.6       22.5
         Snack Foods Group                                     2.6         14.1          2.0       12.5
         Corporate                                            (1.9)       (10.3)        (1.7)     (10.6)
                                                             -----        -----      -------      ----- 
           Subtotal ongoing operations                        18.5        100.0         14.5       90.7
         Businesses sold3                                      0.0          0.0          1.5        9.3
                                                             -----        -----      -------      -----
           Total                                             $18.5        100.0%       $16.0      100.0%
                                                             =====        =====        =====      =====


<FN>
1   Earnings before interest, taxes,  depreciation,  and amortization ("EBITDA")
    does  not  represent  information  prepared  in  accordance  with  generally
    accepted accounting principles,  nor is such information considered superior
    to information  presented in accordance with generally  accepted  accounting
    principles.  The EBITDA calculation begins with Income/(loss)  before taxes,
    dividends,   allocation  of  net  proceeds,  and  cumulative  effect  of  an
    accounting  change and adds to such amount interest  expense,  depreciation,
    and amortization of goodwill and other intangibles.

2   The above information excludes the cumulative effect of an accounting change
    for  the  quarter  ended  September  28,  1996.  See  NOTE 1 -  "Summary  of
    Accounting Policies - Change in Accounting Principle."

3   Includes the activity of the canned vegetable business sold in fiscal 1997.
</FN>



Total Assets

(Dollars in Millions)

                                                                             Quarter Ended
                                                                 September 27,        September 28,
                                                                      1997                 1996
                                                                          % of                   % of
                                                                $         Total       $          Total
                                                             ------      -------   -------       ------

                                                                                        
         CBF                                                 $377.3       61.9%     $389.4        55.1%
         Nalley Fine Foods                                    155.8       25.6       154.7        21.9
         Snack Foods Group                                     26.5        4.4        27.6         3.9
         Corporate                                             49.6        8.1        61.8         8.8
                                                             ------      -----      ------       -----
           Subtotal ongoing operations                        609.2      100.0       633.5        89.7
         Businesses sold1                                       0.0        0.0        72.8        10.3
                                                             ------      -----      ------       -----
           Total                                             $609.2      100.0%     $706.3       100.0%
                                                             ======      =====      ======       =====
<FN>
1   Includes the assets of Finger Lakes Packaging and the portion of the canned vegetable business sold in fiscal 1997.
</FN>

       CHANGES FROM FIRST QUARTER FISCAL 1998 TO FIRST QUARTER FISCAL 1997

Net Sales:  Net sales from ongoing  operations  increased  in the first  quarter
compared  to the prior year by $15.8  million or 10  percent.  This  significant
increase reflects improvements at all three of the Company's business units.

The  most  significant  increases  were  noted  in  the  vegetable  and  aseptic
categories. Net sales for the CBF aseptic category increased $9.2 million, while
the  continuing  vegetable  business  increased  $4.6  million.  The increase in
aseptic  sales  results from new  business,  while the increase in the vegetable
business is  attributable to changes in product mix resulting in improvements in
volume/pricing.

The pickle and dressing  categories  at Nalley also  increased $ 2.1 million and
$1.3 million, respectively due to increased volume.

Small gains were noted in the Snack Foods Group.

Gross Profit:  Gross profit of $45.6 million in the quarter ended  September 27,
1997 increased $4.0 million or 9.5 percent from the quarter ended  September 28,
1996. Excluding the businesses sold in fiscal 1997, the increase in gross profit
is  approximately  $6.3 million.  This increase  results from increased sales as
highlighted above.

Selling,  Administrative,  and General Expenses:  Selling,  administrative,  and
general  expenses have  decreased  $0.2 million as compared with the prior year.
During the first quarter of fiscal 1998, the Company  settled an outstanding tax
claim with the state of Washington ($1.4 million). This settlement was, however,
offset  by  increased  costs  due to  competitive  promotional  spending/selling
expenses  (approximately $0.3 million) and the cost for employee incentive plans
($0.9 million).

Interest  Expense:  Interest  expense for the quarter  ended  September 27, 1997
decreased $2.1 million or 21 percent. This significant  improvement is primarily
the result of the focus on debt reduction which occurred throughout fiscal 1997.
These activities  included the sale of Finger Lakes  Packaging,  the sale of the
canned  vegetable  business,  and the sale of the Georgia  distribution  center.
Reductions in outstanding  debt accounted for a decrease of $2.0 million,  while
changes in rates accounted for a decrease of $0.1 million.

Provision for Taxes:  The provision for taxes in the quarter ended September 27,
1997 of $1.8 million  increased from $0.5 million in the quarter ended September
28, 1996 due to  improvements in earnings.  The Company's  effective tax rate is
negatively impacted by the non-deductibility of goodwill.

Cumulative Effect of a Change in Accounting: Effective June 30, 1996, accounting
procedures were changed to include in prepaid expenses and other current assets,
manufacturing spare parts previously charged directly to expense.  The favorable
cumulative  effect of the change (net of income taxes of $1.2  million) was $4.5
million. Pro forma amounts for the cumulative effect of the accounting change on
prior periods are not determinable due to the lack of physical  inventory counts
required to establish quantities at the respective dates.

                         LIQUIDITY AND CAPITAL RESOURCES

The following  discussion  highlights the major  variances in the  "Consolidated
Statement  of  Changes  in Cash  Flows"  for the first  quarter  of fiscal  1998
compared to the first quarter of fiscal 1997.

Net cash used in operating  activities  increased  approximately  $7.2  million.
Additional  funds were used during the quarter to liquidate  payments for crops.
Crops in the current  year have been  available  earlier for harvest than in the
prior year. In addition, the reduction in inventories, attributed to the sale of
the canned  vegetable  business in the fourth quarter of fiscal 1997, was offset
by the increase in net income and the timing of the  liquidation  of outstanding
receivables/payables.

Net cash used in investing  activities  decreased in the first quarter of fiscal
1998  due to the  timing  of  various  capital  expenditures.  The  purchase  of
property, plant, and equipment in both years was for general operating purposes.

Net cash provided by financing  activities  increased from the prior year due to
the receipt of proceeds from Great Lakes Kraut and additional borrowing incurred
in the first quarter of fiscal 1998 for operating needs.

Borrowings:  Under the Company's Credit Agreement, as amended,  Agrilink is able
to borrow up to $66.0 million for seasonal  working  capital  purposes under the
Seasonal  Facility,  subject to a borrowing  base  limitation,  and obtain up to
$18.0 million in aggregate face amount of letters of credit pursuant to a Letter
of Credit Facility. The borrowing base is defined as the lesser of (i) the total
available  line or (ii) the sum of 60 percent of  eligible  accounts  receivable
plus 50 percent of eligible inventory.

As of September 27, 1997,  (i) cash  borrowings  outstanding  under the Seasonal
Facility were $64.0 million and (ii) additional  availability under the Seasonal
Facility,  after  taking  into  account  the  amount of the  borrowing  was $2.0
million.  In addition to its seasonal  financing,  as of September 27, 1997, the
Company had $26.6 million available for long-term borrowings under the Term Loan
Facility.  The  Cooperative  believes  that  the  cash  flow  generated  by  its
operations and the amounts available under the Seasonal and Term Loan Facilities
should  be  sufficient  to fund its  working  capital  needs,  fund its  capital
expenditures, service its debt, and pay dividends for the foreseeable future.

Certain  financing  arrangements  require that Pro-Fac and Agrilink meet certain
financial  tests and ratios and  comply  with  certain  other  restrictions  and
limitations.  As of September 27, 1997,  Pro-Fac is in compliance  with all such
covenants, restrictions and limitations.

Short- and  Long-Term  Trends:  The  vegetable  portion of the  business  can be
positively  or  negatively  affected by weather  conditions  nationally  and the
resulting impact on crop yields.  Favorable weather  conditions can produce high
crop yields and an oversupply




situation. This results in depressed selling prices and reduced profitability on
the  inventory  produced  from that  year's  crops.  Excessive  rain or  drought
conditions can produce low crop yields and a shortage situation.  This typically
results in higher selling prices and increased profitability. While the national
supply situation controls the pricing,  the supply can differ regionally because
of variations in weather.

The effect of the 1997 growing season on fiscal 1998 financial results cannot be
estimated until late 1997 or early calendar 1998 when harvesting is complete and
national supplies can be determined.


ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K

     (a) EXHIBITS

         EXHIBIT
         NUMBER                        DESCRIPTION

         Exhibit 3.3           Certificate of Incorporation of Pro-Fac 
         Exhibit 27            Financial Data Schedule

     (b) No current  report on Form 8-K was filed  during  the fiscal  period to
which this report relates.













                                   SIGNATURES



Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.



                                             PRO-FAC COOPERATIVE, INC.




Date:  November 6, 1997             BY:/s/     Stephen R. Wright
       ----------------                ------------------------------
                                               STEPHEN R. WRIGHT,
                                                GENERAL MANAGER




Date: November 6, 1997              BY:/s/     Earl L. Powers
      ----------------                 ------------------------------
                                                EARL L. POWERS,
                                          VICE PRESIDENT FINANCE AND
                                              ASSISTANT TREASURER
                                       (Principle Financial Officer and
                                          Principle Accounting Officer)