Global Agribusiness Lecture 3-2 Learning Ojectives Describe the major features of global agribusiness. List the factors that contribute to the costs of this kind of system.

The Journey Of A Tomato Solanum esculentum Grown in California, Florida, Ontario Transported world-wide, often as ketchup or tomato sauce

Journey of a Tomato Fresh tomatoes hand picked (about 1 million tons-US total) Hand-picking pays between $7500 and $10000 US per year, often piecework

Tomato Processing Processed tomatoes picked by machine (about 7 million tons-US total)

Tomato Processing

Processing Tomatoes

Tomato Processing

Market Domination Nestle, Cargill, Monsanto Seeds, Chemicals, Crop varieties Top 3 seed companies control 20% of total seed trade Top 10 agrochemical companies control 91% of market Cargill and Continental control 2/3 of world grain trade

Agricultural Subsidies $12 billion in subsidies to US farms in 2002 Cargill Intl. got $10 million! US support= 29% of value of farm production; Canada= 9% Nevertheless: Ontario farm subsidies= $844 million/year

Waste

Huge Farms Number of farms is decreasing Average farm size is increasing In Canada: 276, 548 farms (1996) Number of farms decreased by 18.3% since 1976 Size has increased by 22% (average size 608 acres)

Problems For Growers Oversupply: leads to lower prices Trade dumping from foreign (US) markets Disease outbreaks

Key Features of Global Agribusiness Distancing Profit motive Exports Monopolies Crops are commodities

Key Features of Global Agribusiness Uniformity Processing Specialization Control of nature Intellectual property control $