AGRIBUSINESS (En)

Agricultural production, transformation and marketing activities, in particular as carried out or controlled by multinational corporations controlling a significant part of farming activities around the world.

"[A] million American workers will loose their jobs as low cost production shifts to China. That could be a benefit to China in theory, it might improve wages there, except for another small defect of the free investment agreement, namely 900 million Chinese peasants who are expected to be driven off the land and will be in deep trouble when their country becomes flooded with subsidized US agribusiness exports, and as they flood the labor market driving down wages. That picture is quite familiar next door between the United States and Mexico: the neo-liberal reforms in the early 1980's, and since that time, for about 80% of the population, living standards and incomes have declined and continued after NAFTA, contrary to all predictions by main-stream economists."
(Chomsky, N., The Other Davos, 2001, visited 2009-05-19)

Agribusiness, Capital and Commodity Prices

"The dominant transnational agribusiness firms are characterized not only by horizontal integration in a given sector, but also by their simultaneous dominance of multiple sectors of agricultural production, shipping and processing. Cargill, for example, is the largest grain exporter in the United States and probably in the world. It is dominant in wheat, soybeans, corn and cotton. It is also ranked seventh in the world as a food and beverage company […]. Cargill is also a major player in beef packing, ethanol, steel, fertilizer production and financial services.
[…]
The sources of market power for transnational agribusiness are multifaceted, extending beyond concentrated market power. The companies also have privileged access to information, to capital and to political power, all of which help to limit competition by creating barriers to entry.

Through their operations in well over 100 countries, the dominant transnational agribusiness firms have access to information that very few other actors, including most governments, can aspire to. Commodity prices depend not only on supply, but also on forecasts about the future availability of supply. Futures and options markets are risk management tools, helping to offset the exposure of contracting to supply a given amount of commodity ahead of harvest time. The commodity exchanges in practice seem to be less a way to spread risk, and more a way to concentrate profits for those who know the most about a market.

Transnational agribusiness also has access to enormous sums of capital, necessary to cover futures and options contracts, and hence influence the prices by which trade-policy-mediated domestic support and export subsidies are set. At the same time, the global nature of their operations gives these firms a political voice in dozens of countries simultaneously, creating a powerful force for policies that reflect their interests."
(Food and Agriculture Organization of the United Nations, The role of transnational corporations, visited 2009-05-19)

Agribusiness and Globalization

"McGregor (2002) notes that globalisation has impacted on Australian agribusiness by aggregating the farm input and service sector into fewer, larger and more sophisticated firms. This aggregation has reduced competition in the supply of farm inputs such as fertilisers and chemicals. […] The bargaining power in supply chains is controlled by agribusinesses rather than individual farmers (Trechter & Murray-Prior 2003). Individual farmers in supply chains have to deal with oligopolistic firms (a large number of large firms producing differentiated products), both upstream (input suppliers) and downstream (food processors/manufacturers and retailers)."
(Curtin University of Technology, Consultancy Report: Analysis of Supply Chain of Agricultural Commodities in the North Eastern Agricultural Region (NEAR), visited 2007-06-01)

Agribusiness and Labour

"In the [Mexican] countryside, agroindustry has also displaced the labor force which has had to emigrate. These industries tend to use up natural resources, and, once they have done so, they move away to some other location. The firms also move out when workers organize and fight for their rights. Faced with this phenomenon, farmers combine agricultural production with work in the maquiladoras."
(United Electrical, Radio & Machine Workers of America (UE), Mexican Labor News and Analysis, v. VI, n. 10, 2001, visited 2009-05-19)