PHILIPPINE AGRIBUSINESS: AN INTRODUCTION
Vicky Guieb
ABM 103 June 26, 2007
Contents
Agribusiness as a concept Agribusiness as a field of study Agribusiness as an economic sector Agribusiness & Business Agribusiness in the Economy Agribusiness Sector Economic Contribution Vertical Structure & Coordinators Agribusiness System
What is Agribusiness?
TRADITIONAL DEFINITION: sum total of all operations involved in the manufacture of farm supplies, production activities on the farm, processing, distribution and marketing of farm commodities and items made from them. (Davis and Goldberg (1957)
What is Agribusiness?
REFRAMED DEFINITION: (market-oriented) a dynamic and systemic endeavor that serves consumers globally and locally through innovation and management of multiple value chains that deliver valued goods and services derived from sustainable orchestration of food, fiber and natural resources. (Edwards & Shultz II, 2005)
Agribusiness as a Field of Study
integrative and multi-disciplinary in nature multidisciplinary areas: economics : economics of agriculture agricultural sciences : animal, crops, fishery, forestry management : finance, production, marketing, personnel human behavior: leadership, motivation, rewards management in orientation
Agribusiness as an Economic Sector
consisting of on-farm and off-farm business units selling of inputs (eg. fertilizers, agrochemicals) on-farm production of crops and livestock, forest trees, fish off-farm business activities like leather tanning, woodworks production provision of agroservices (financing, market information, technology, education, warehousing)
Agribusiness & Business
AGRIBUSINESS: if a business enterprise moves nearer to agriculture and mainly uses AGRICULTURAL raw materials BUSINESS: if a business enterprise moves farther from agriculture, making use of NONAGRICULTURAL raw materials
The manufacturing components of agribusiness are agroindustries
Agribusiness in the Economy
a vertical slice of the total economy
Source: Bill & Davidson, Agribusiness Disciplines and Dimensions
Agribusiness Sector
encompasses the whole of the agriculture sector plus a portion of the industrial & service sectors
AGRICULTURE
INDUSTRY Agroindustries
SERVICES
Agroservices
Economic Sectors of Agribusiness
Agriculture Crops Livestock Fishery Forestry
Economic Sectors of Agribusiness
Agriculture: Economic Contribution
food
provider of the economy contributes around 17% to the GDP (2007) employs around 33% of the total workforce (2002)
Economic Sectors of Agribusiness
Agroindustries
Food Industries
Processed
meat Milk and dairy products Processed fruits and vegetables Processed fish Bakery products Beverages e.g. chocolate, coffee, tea Condiments and flavoring extracts Cereals
Economic Sectors of Agribusiness
Agroindustries
Non-Food Industries Leather and leather products Wood and woodworks and cork products Tobacco manufactures Rubber and rubber products Textile manufactures Paper and paper products Fiber products
Economic Sectors of Agribusiness
Agroservices
Financing Physical distribution services (e.g. transportation, warehousing) Market research Market information dissemination Insurance Technical Assistance Market Matching Research and Development
Vertical Structure & Coordinators
Consumers Retailers
Wholesalers
Processors Farmers Farm Suppliers
Managers Government Officers Educators
Researchers
Agribusiness System
Subsystems:
Input Subsystem Production Subsystem Processing Subsystem Marketing Subsystem Support Subsystem
Agribusiness Subsystems
Input Subsystem
Fertilizer Industry Feeds Industry Seed Industry Other Agrochemical Industry Agricultural Machinery & Irrigation Equipments Veterinary Products Animal Resources: breeding & hatchery
Agribusiness Subsystems
Farm/Production
Subsystem
into direct on-farm production activities livestock, crops, fish & forest trees
Processing (Agroindustrial) Subsystem
the primary, intermediate & final processors the food and non-food agroindustries prolongs the shelf life of agricultural products
minimizes the adverse effects of seasonality & perishability
opens up more markets domestic & foreign
Marketing Subsystems
for physical distribution & transfer of products traders, sales agents, brokers, assemblers, wholesalers, retailers, importers, exporters other intermediaries
Support Subsystems
providers of agroservices
Thats all for today!