AGRICULTURE FOOD INDUSTRY

Agriculture Food Industry



Agriculture Food Industry

Introduction

Agribusiness is the term used for the farms and business firms associated with the production of food using agricultural crops. These firms include different food firms that include the suppliers of pesticides, fertilizers and seeds. Agribusiness is not limited to the supply of seeds and fertilizers but it also involves in food production, distribution, processing, research and marketing. This is due to the fact that the industry has been expanding rapidly over the years. In recent years, the agriculture food industry has undergone drastic changes in terms of technological advancements, enabling the large-sized firms to create monopolistic situations (Merrifield, and Steven, 2002, Pp. 14).

The agricultural food production industry faced a dramatic change during the mid-20th century. Massive food production with enlarged supply took place in that era. This rapid expansion was made possible due to the availability of land and fuel at cheaper rates. Another factor enhancing the agricultural productivity was the technological advancement that took place, such as refrigeration cars, rail transport and combustion engine. These changes and advancements shifted the industry to fewer and larger firms. In today's world, the food production process has been made highly mechanized and requires greater efficiency yielding higher profits and share prices (Magdoff, 2000, Pp. 48).

Discussion

Social problems

It has been observed that the large-sized business firms are earning higher profits, thus making the survival of small sized firms difficult. This is due to the fact that the decision power of the industry is concentrated in the hands of a few. This shows that the industry is observing the capitalist style due to fact that all the power and wealth is concentrated in the hands of giant-sized firms. Higher efficiency and technological advancements has allowed large-sized businesses to sell their products at lower prices that small businesses are unable to do. This eliminates many small businesses out of the industry (Kees and Sietze, 2004, Pp. 21).

Another social problem associated with the contemporary agriculture food industry is the environmental and social costs associated with lower cost of food production. It can also be said that the agribusiness poses a threat to food security and food sovereignty. Another trend is the shift of the food industry to food processors from food producers and to privately funded research activities from publicly funded research activities. Additionally, there is an increased concentration of ownership as the global food market is dominated by only a few corporations.

The most visible example is the 65% share of ADM and Cargill in the world grain market. Similarly, the power of decision-making is also concentrated. IMF and World Bank promote international policies that support export-oriented crop production. This kind of policies and vision support such a model of agribusiness that contains large-sized firms, production of a single crop linked with distribution, processing and marketing. This eliminates the existence of subsistence farming in the economy (Gary and Ken, 2007, Pp. 25).

Small farmers and rural communities are at risk in a scenario when the communities have less ...