Agribusiness

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Agribusiness: a display of a John Deere 7800 tractor with Houle slurry trailer, Case IH combine harvester, New Holland FX 25 forage harvester with corn head Agricultural machinery.jpg
Agribusiness: a display of a John Deere 7800 tractor with Houle slurry trailer, Case IH combine harvester, New Holland FX 25 forage harvester with corn head

Agribusiness is the business of agricultural production. The term was coined in 1957 by Goldberg and Davis[ citation needed ]. It includes agrichemicals, breeding, crop production (farming and contract farming), distribution, farm machinery, processing, and seed supply, as well as marketing and retail sales. All agents of the food and fiber value chain and those institutions that influence it are part of the agribusiness system.

Business Organization undertaking commercial, industrial, or professional activity

Business is the activity of making one's living or making money by producing or buying and selling products. Simply put, it is "any activity or enterprise entered into for profit. It does not mean it is a company, a corporation, partnership, or have any such formal organization, but it can range from a street peddler to General Motors."

Animal husbandry Management, selective breeding, and care of farm animals by humans

Animal husbandry is the branch of agriculture concerned with animals that are raised for meat, fibre, milk, eggs, or other products. It includes day-to-day care, selective breeding and the raising of livestock.

Contents

Within the agriculture industry, "agribusiness" is used simply as a portmanteau of agriculture and business, referring to the range of activities and disciplines encompassed by modern food production. There are academic degrees in and departments of agribusiness, agribusiness trade associations, agribusiness publications, and so forth, worldwide.

An industry is the production of goods or related services within an economy. The major source of revenue of a group or company is the indicator of its relevant industry. When a large group has multiple sources of revenue generation, it is considered to be working in different industries. Manufacturing industry became a key sector of production and labour in European and North American countries during the Industrial Revolution, upsetting previous mercantile and feudal economies. This came through many successive rapid advances in technology, such as the production of steel and coal.

A portmanteau or portmanteau word is a linguistic blend of words, in which parts of multiple words or their phones (sounds) are combined into a new word, as in smog, coined by blending smoke and fog, or motel, from motor and hotel. In linguistics, a portmanteau is defined as a single morph that represents two or more morphemes.

In the context of agribusiness management in academia, each individual element of agriculture production and distribution may be described as agribusinesses. However, the term "agribusiness" most often emphasizes the "interdependence" of these various sectors within the production chain. [1]

Among critics of large-scale, industrialized, vertically integrated food production, the term agribusiness is used negatively, synonymous with corporate farming . As such, it is often contrasted with smaller family-owned farms.

Vertical integration When a company owns its supply chain

In microeconomics and management, vertical integration is an arrangement in which the supply chain of a company is owned by that company. Usually each member of the supply chain produces a different product or (market-specific) service, and the products combine to satisfy a common need. It is contrasted with horizontal integration, wherein a company produces several items which are related to one another. Vertical integration has also described management styles that bring large portions of the supply chain not only under a common ownership, but also into one corporation.

Corporate farming

Corporate farming is the practice of large-scale Agriculture on farms owned or greatly influenced by large companies. This includes corporate ownership of farms and selling of agricultural products, as well as the roles of these companies in influencing agricultural education, research, and public policy through funding initiatives and lobbying efforts.

Family farm farm owned or operated by a family

A family farm is generally understood to be a farm owned and/or operated by a family; it is sometimes considered to be an estate passed down by inheritance. Family farm businesses can take many forms, as most farm families have structured their farm businesses as corporations, limited liability corporations, and trusts, for liability, tax, and business purposes. It is a common misconception that all farms with these business structures are not family farms, when in actuality that is not true. In the United States for example, a 2014 USDA report shows that family farms operate 90 percent of the nation’s farmland, and account for 85 percent of the country’s agricultural production value.

Examples

Examples of agribusinesses include seed and agrichemical producers like Dow AgroSciences, DuPont, Monsanto, and Syngenta; AB Agri (part of Associated British Foods) animal feeds, biofuels, and micro-ingredients, ADM, grain transport and processing; John Deere, farm machinery producer; Ocean Spray, farmer's cooperative; and Purina Farms, agritourism farm.

Dow AgroSciences LLC is a wholly owned subsidiary of the Dow Chemical Company specializing in not only agricultural chemicals such as pesticides, but also seeds and biotechnology solutions. The company is based in Indianapolis, Indiana, in the United States. On 31 January 2006, Dow AgroSciences announced that it had received regulatory approval for the world's first plant-cell-produced vaccine against Newcastle disease virus from USDA Center for Veterinary Biologics. Dow AgroSciences operates brand names such as Sentricon, Vikane, Mycogen®, SmartStax®, Enlist™, Pfister Seed®, PhytoGen®, Prairie Brand Seed®, Alforex Seeds®, Profume, Dairyland Seed®, and Brodbeck Seed®.

E. I. du Pont de Nemours and Company, commonly referred to as DuPont, is an American conglomerate that was founded in July 1802 in Wilmington, Delaware, as a gunpowder mill by French-American chemist and industrialist Éleuthère Irénée du Pont.

The Monsanto Company was an American agrochemical and agricultural biotechnology corporation founded in 1901. In 2018, it was acquired by Bayer as part of its crop science division. It was headquartered in Creve Coeur, Missouri. Monsanto developed Roundup, a glyphosate-based herbicide, in the 1970s, and became a major producer of genetically engineered crops.

As concern over global warming intensifies, biofuels derived from crops are gaining increased public and scientific attention. This is driven by factors such as oil price spikes, the need for increased energy security, concern over greenhouse gas emissions from fossil fuels, and support from government subsidies. In Europe and in the US, increased research and production of biofuels have been mandated by law. [2]

Global warming rise in the average temperature of the Earths climate system and its related effects

Global warming is a long-term rise in the average temperature of the Earth's climate system, an aspect of climate change shown by temperature measurements and by multiple effects of the warming. Though earlier geological periods also experienced episodes of warming, the term commonly refers to the observed and continuing increase in average air and ocean temperatures since 1900 caused mainly by emissions of greenhouse gasses in the modern industrial economy. In the modern context the terms global warming and climate change are commonly used interchangeably, but climate change includes both global warming and its effects, such as changes to precipitation and impacts that differ by region. Many of the observed warming changes since the 1950s are unprecedented in the instrumental temperature record, and in historical and paleoclimate proxy records of climate change over thousands to millions of years.

Energy security National security considerations of energy availability

Energy security is the association between national security and the availability of natural resources for energy consumption. Access to (relatively) cheap energy has become essential to the functioning of modern economies. However, the uneven distribution of energy supplies among countries has led to significant vulnerabilities. International energy relations have contributed to the globalization of the world leading to energy security and energy vulnerability at the same time.

Greenhouse gas gas in an atmosphere that absorbs and emits radiation within the thermal infrared range

A greenhouse gas is a gas that absorbs and emits radiant energy within the thermal infrared range. Greenhouse gases cause the greenhouse effect. The primary greenhouse gases in Earth's atmosphere are water vapor, carbon dioxide, methane, nitrous oxide and ozone. Without greenhouse gases, the average temperature of Earth's surface would be about −18 °C (0 °F), rather than the present average of 15 °C (59 °F). The atmospheres of Venus, Mars and Titan also contain greenhouse gases.

Studies and reports

Studies of agribusiness often come from the academic fields of agricultural economics and management studies, sometimes called agribusiness management. [1] To promote more development of food economies, many government agencies support the research and publication of economic studies and reports exploring agribusiness and agribusiness practices. Some of these studies are on foods produced for export and are derived from agencies focused on food exports. These agencies include the Foreign Agricultural Service (FAS) of the U.S. Department of Agriculture, Agriculture and Agri-Food Canada (AAFC), Austrade, and New Zealand Trade and Enterprise (NZTE).

The Federation of International Trade Associations publishes studies and reports by FAS and AAFC, as well as other non-governmental organizations on its website. [3]

Ray A. Goldberg coined the term agribusiness together with coauthor John H. Davis. They provided a rigorous economic framework for the field in their book A Concept of Agribusiness (Boston: Division of Research, Graduate School of Business Administration, Harvard University, 1957). That seminal work traces a complex value-added chain that begins with the farmer's purchase of seed and livestock and ends with a product fit for the consumer's table. Agribusiness boundary expansion is driven by a variety of transaction costs.[ citation needed ]

Manuel Alvarado Ledesma (CEMA University, Argentina) and Peter D. Goldsmith (University of Illinois) explain the implications of weak institutions on agribusiness investment. According to them weak institutions lead to policy development and enforcement grounded in the moment, rather than based on precedent and deliberative processes over time.[ citation needed ]

See also

Notes and references

  1. 1 2 Ng, Desmond; Siebert, John W. (2009). "Toward Better Defining the Field of Agribusiness Management" (PDF). International Food and Agribusiness Management Review. 12 (4).
  2. "Backpedaling on Biofuels". Wild.org. 2008-08-01. Archived from the original on 2012-09-19. Retrieved 2013-05-02.
  3. "fita.org". fita.org. Retrieved 2013-05-02.

Further reading


Related Research Articles

Agriculture Cultivation of plants and animals to provide useful products

Agriculture is the science and art of cultivating plants and livestock. Agriculture was the key development in the rise of sedentary human civilization, whereby farming of domesticated species created food surpluses that enabled people to live in cities. The history of agriculture began thousands of years ago. After gathering wild grains beginning at least 105,000 years ago, nascent farmers began to plant them around 11,500 years ago. Pigs, sheep and cattle were domesticated over 10,000 years ago. Plants were independently cultivated in at least 11 regions of the world. Industrial agriculture based on large-scale monoculture in the twentieth century came to dominate agricultural output, though about 2 billion people still depended on subsistence agriculture into the twenty-first.

The following outline is provided as an overview of and topical guide to agriculture:

Farmer person that undertakes agriculture

A farmer is a person engaged in agriculture, raising living organisms for food or raw materials. The term usually applies to people who do some combination of raising field crops, orchards, vineyards, poultry, or other livestock. A farmer might own the farmed land or might work as a laborer on land owned by others, but in advanced economies, a farmer is usually a farm owner, while employees of the farm are known as farm workers, or farmhands. However, in the not so distant past, a farmer was a person who promotes or improves the growth of by labor and attention, land or crops or raises animals.

Farm area of land for farming, or, for aquaculture, lake, river or sea, including various structures

A farm is an area of land that is devoted primarily to agricultural processes with the primary objective of producing food and other crops; it is the basic facility in food production. The name is used for specialised units such as arable farms, vegetable farms, fruit farms, dairy, pig and poultry farms, and land used for the production of natural fibres, biofuel and other commodities. It includes ranches, feedlots, orchards, plantations and estates, smallholdings and hobby farms, and includes the farmhouse and agricultural buildings as well as the land. In modern times the term has been extended so as to include such industrial operations as wind farms and fish farms, both of which can operate on land or sea.

Good agricultural practice (GAP) are specific methods which, when applied to agriculture, create food for consumers or further processing that is safe and wholesome. While there are numerous competing definitions of what methods constitute good agricultural practice there are several broadly accepted schemes that producers can adhere to.

Monocropping is the agricultural practice of growing a single crop year after year on the same land, in the absence of rotation through other crops or growing multiple crops on the same land polyculture. Corn, soybeans, and wheat are three common crops often grown using monocropping techniques.

Food industry collective of diverse businesses that supplies much of the worlds food

The food industry is a complex, global collective of diverse businesses that supplies most of the food consumed by the world's population. Only subsistence farmers, those who survive on what they grow, and hunter-gatherers can be considered outside the scope of the modern food industry.

A smallholding is a small farm. In developing countries, smallholdings are usually farms supporting a single family with a mixture of cash crops and subsistence farming. As a country becomes more affluent, smallholdings may not be self-sufficient but are valued primarily for the rural lifestyle that they provide for the owners, who often do not earn their livelihood from the farm. There are an estimated 500 million smallholder farms in the world, supporting almost 2 billion people. Today some companies try to include smallholdings into their value chain, providing seed, feed or fertilizer to improve production. Some say that this model shows benefits for both parties.

History of organic farming

Traditional farming was the original type of agriculture, and has been practiced for thousands of years. All traditional farming is now considered to be "organic farming" although at the time there were no known inorganic methods. For example, forest gardening, a fully organic food production system which dates from prehistoric times, is thought to be the world's oldest and most resilient agroecosystem. After the industrial revolution had introduced inorganic methods, most of which were not well developed and had serious side effects. An organic movement began in the 1940s as a reaction to agriculture's growing reliance on synthetic fertilizers and pesticides. The history of this modern revival of organic farming dates back to the first half of the 20th century at a time when there was a growing reliance on these new synthetic, non-organic methods.

Canada is one of the largest agricultural producers and exporters in the world. As with other developed nations, the proportion of the population and GDP devoted to agriculture fell dramatically over the 20th century but it remains an important element of the Canadian economy. A wide range of agriculture is practised in Canada, from sprawling wheat fields of the prairies to summer produce of the Okanagan valley. In the federal government, overview of Canadian agriculture is the responsibility of the Department of Agriculture and Agri-Food.

Agriculture in Nigeria

Agriculture in Nigeria is a branch of the economy in Nigeria, providing employment for about 30% of the population as of 2010. The sector is being transformed by commercialization at the small, medium and large-scale enterprise levels.

Intensive crop farming

Intensive crop farming is a modern form of intensive farming that refers to the industrialized production of crops. Intensive crop farming's methods include innovation in agricultural machinery, farming methods, genetic engineering technology, techniques for achieving economies of scale in production, the creation of new markets for consumption, patent protection of genetic information, and global trade. These methods are widespread in developed nations.

Agro- and agri- are prefixes that usually refer to agriculture. The following items use the prefix 'agro-' or alternatively 'agri-':

Richard Gilmore is President/CEO of GIC Trade, Inc., an international agribusiness company with partner offices in Beijing, São Paulo, Quito, Moscow, and Tel Aviv. He is also Founder and Chairman of the Global Food Safety Forum (GFSF), a non-profit industry organization focused on educational and training activities in Asia with offices in the People's Republic of China (PRC) and Vietnam. A trade economist and businessman with a Ph.D. from the Graduate Institute of International Studies in Geneva, where he was a Fulbright Fellow, Gilmore serves as Trustee for Bayer CropSciences, Syngenta Corporation, and Agrium, Inc. He is currently Special External Advisor to the White House/USAID for the Private Sector/Global Food Security and Managing Director of the Global Food Safety Forum (GFSF) in Beijing.

Agroecology in Latin America

Agroecology is an applied science that involves the adaptation of ecological concepts to the structure, performance, and management of sustainable agroecosystems. In Latin America, agroecological practices have a long history and vary between regions but share three main approaches or levels: plot scale, farm scale, and food system scale. Agroecology in Latin American countries can be used as a tool for providing both ecological, economic, and social benefits to the communities that practice it, as well as maintaining high biodiversity and providing refuges for flora and fauna in these countries. Due to its broad scope and versatility, it is often referred to as "a science, a movement, a practice."

Agricultural engineering applied science

Agricultural engineering is the engineering discipline that studies agricultural production and processing. Agricultural engineering combines the disciplines of mechanical, civil, electrical and chemical engineering principles with a knowledge of agricultural principles according to technological principles. A key goal of this discipline is to improve the efficacy and sustainability of agricultural practices. One of the leading organizations in this industry is the American Society of Agricultural and Biological Engineers.

Land grabbing

Land grabbing is the contentious issue of large-scale land acquisitions: the buying or leasing of large pieces of land by domestic and transnational companies, governments, and individuals. While used broadly throughout history, land grabbing as used in the 21st century primarily refers to large-scale land acquisitions following the 2007–08 world food price crisis. Obtaining water resources is usually critical to the land acquisitions, so it has also led to an associated trend of water grabbing. By prompting food security fears within the developed world and new found economic opportunities for agricultural investors, the food price crisis caused a dramatic spike in large-scale agricultural investments, primarily foreign, in the Global South for the purpose of industrial food and biofuels production. Although hailed by investors, economists and some developing countries as a new pathway towards agricultural development, investment in land in the 21st century has been criticized by some non-governmental organizations and commentators as having a negative impact on local communities. International law is implicated when attempting to regulate these transactions.

Gus Schumacher, born August Schumacher, Jr., was Vice-President of Policy at the Wholesome Wave Foundation in Bridgeport, Connecticut. He was also a member of the 21st Century Sustainable Agricultural Task Force of the National Academy of Sciences. In 2007, Schumacher, along with Cathy Bertini, former Director of the World Food Programme, and Professor Robert Thompson, Gardner Professor of Agricultural Economics at Illinois, oversaw the preparation of the Task Force Report of the Chicago Council on Global Affairs, titled “Modernizing America’s Food and Farm Policy: Vision for a New Direction” (2006).

Contract farming involves agricultural production being carried out on the basis of an agreement between the buyer and farm producers. Sometimes it involves the buyer specifying the quality required and the price, with the farmer agreeing to deliver at a future date. More commonly, however, contracts outline conditions for the production of farm products and for their delivery to the buyer’s premises. The farmer undertakes to supply agreed quantities of a crop or livestock product, based on the quality standards and delivery requirements of the purchaser. In return, the buyer, usually a company, agrees to buy the product, often at a price that is established in advance. The company often also agrees to support the farmer through, e.g., supplying inputs, assisting with land preparation, providing production advice and transporting produce to its premises. The term "outgrower scheme" is sometimes used synonymously with contract farming, most commonly in Eastern and Southern Africa. Contract farming can be used for many agricultural products, although in developing countries it is less common for staple crops such as rice and maize.

The Central Institute of Agricultural Engineering (CIAE) is a higher seat of learning, research and development in the field of agriculture, situated in the lake city of Bhopal, Madhya Pradesh, India. It is an autonomous body, an Indian Council of Agricultural Research subsidiary, under the Ministry of Agriculture, Government of India.