commodity chain + economies of scale Flashcards
Agribusiness
large-scale system that includes the production, processing, and distribution of agricultural products and equipment
**Farmers are just a small part of the process of getting the food from the field to the consumer. They are just one part of the commodity chain.
Economies of Scale
cost reductions that occur when production rises
When Choosing the Best Site for Agriculture
(physical factors)
Soil quality
Topography (sloped/flat lands)
Climate
Access to water
When Choosing the Best Site for Agriculture
(cultural factors)
Food taboos
But Von Thunen Argued: the most important factor is…
distance to market
Global Supply Chain
same as commodity chains, but on the global scale. Allows for the delivery of product between two different countries.
WHY Global Supply Chains Exist
Climate
Cost (land, labor, capital)
Transnational corporations
Neocolonialism
Comparative Advantage
…because core countries don’t HAVE to grow if they don’t want to
Commodity Dependence
when more than 60 percent of a country’s exports and economic health are tied to one or two resources such as oil, timber, or plantation crops
commodity dependence positives
become well-known for it, becomes very specialized
commodity dependence negatives
subject to supply and demand, what if disaster strikes
how to help global supply chains flow
(infrastructure)
foundation:
Roadways
Water lines
Electric lines
Seaports
Airports
Train stations
Factories
Communication systems
**Sometimes core countries help to sponsor these infrastructural projects (mutually beneficial), but sometimes projects fail
how to help global supply chains flow
(political relationships)
Some supranational organizations are trading blocs, and allows for the supply chain to operate easier, more efficiently, and cheaper across multiple countries
Terracing
Process of carving parts of a hill or mountainside into small, level growing plots
*Common in subsistence farming
*Common for rice cultivation in mountainous
areas
*Terraces flood as rainfall goes down hillside
terracing positives
able to cultivate land that was otherwise unproductive, maintains soil fertility and slows down rainfall
terracing negatives
labor intensive, constant maintenance to prevent runoff and mudslides
Irrigation
bringing in water from natural sources to farm fields through canals and other means to help supplement rainfall
**Common in all forms of agriculture
irrigation positives
has expanded agriculture to places previously too dry to support crop growth
irrigation negatives
consequences of dams, water levels dropping and increased salinity in natural sources, increased agriculture has put a growing demand on water sources
Examples: lakes, rivers, aquifers, reservoirs
draining wetland (the practice)
draining swamplands and bogs to convert them into agricultural lands
**Common in: The Netherlands, and areas converted to wet rice
draining wetlands positives
expands agricultural land, considered wasteland since it did not support construction, gets rids of areas prone to pests and mosquitos
draining wetlands negatives
loss of habitat for many animals and natural vegetation, less drainage area following storms,
deforestation
loss of forest lands
Why? Shifting cultivation, commercial agriculture
deforestation positives
creates more open space for agriculture
deforestation negatives
loss of biodiversity, loss of habitat, soil erosion, increased greenhouse gases, increased flooding
Desertification
a form of land degradation that occurs when soil deteriorates to a desertlike condition
*Common in areas that area arid, prone to overgrazing, over farming, or deforestation
desertification negatives
harms food supply for both humans and animals, health problems with breathing in dust
Air Pollution
Increased carbon emissions from machinery
Increased methane emissions from cattle industry
Water Pollution
Increase water usage decreases groundwater supply
Fertilizer and pesticide runoff
Runoff causes uncontrollable plant growth in water sources
Salinization
the process by which water-soluble salts build up in the soil
**Common in arid areas where water evaporates faster than replenished by rainfall, leaving behind higher concentration of minerals
commercial farmers problem areas
Air pollution from heavy machinery
Water use
Toxins in groundwater
commercial farmers possible solutions
Setting aside preservation land
Financial incentives to farmers for using sustainable practices
More organic farming practices
subsistence farmers problem areas
Soil fertility and depletion
Need to feed an increasing population
subsistence farmers possible solutions
- Crop rotation
- Intensify efforts in already cultivated lands, but leaving less fertile land for preservation
- Can use many of the same techniques as commercial ag.–but more focused on survival, not profits
Societal Challenges
More organic produce consumption as a reaction to fears of GMOs and overuse of fertilizers and pesticides
*But many consumer resist change and will
continue to consumer certain products no
matter the environmental cost–beef
Roles of women
Changing economic purpose of farming
*In U.S.–steady change from small, family-
owned farms to large-scale agribusiness
*Smaller number of people employed in
farming as a result
Rise in monocropping
*Lack of diversity=problems with all your eggs in one basket, they call ALL break easily (drought, natural disaster, change in consumer demand)
Urban Farming
conversion of vacant urban spaces to small local gardens to grow fresh produce for a small community
Community Supported Agriculture (CSAs)
community purchases shares in a local farm, and receive a box periodically of locally grown food
local food movements positives (CSAs and urban farming)
connects producers and consumers, supports local farmers and local economies, cuts down on transportation costs
local food movements negatives (CSAs and urban farming)
limited in scope, not always profitable, transportation costs are not the most impactful factor on environment
organic farming focus
using less chemicals and external inputs in their agricultural practices. Use natural fertilizers and focus on soil health. Promote biodiversity and sustainability
organic farming positives
less harmful on the environment, there is a growing demand so they are seeing profits, more plant and animal integration
organic farming negatives
still some use of chemicals, products are more expensive for consumers, more labor intensive
how to produce value-added crops
Differentiate your product (organic, grassfed, etc.)
Quality, functionality, useful form, ease of possession
Process it (vertical integration)
Fill a market niche
Right place, right time
Examples:
Coffee, dairy products, wheat to flour, etc.
Fair Trade
a global campaign to fix unfair wage practices and protect the ability of farmers to earn a living
Food Security
access to safe, nutritious food
Food Insecurity
poor access to food
**In U.S., most common reason: lack of money
Food desert:
areas where residents lack access to healthy, nutritious food because stores selling these foods are too far away.
Communities with at least 33% of population living more than one mile from a supermarket/grocery store (rural=10 miles)
Typically: low income, higher unemployment, and higher poverty rates
Women in agriculture and rural areas have this in common…
Less access than men to productive resources and opportunities
Where the gender gap is found
Land
Livestock
Labor
Education
Extension and financial services
Technology
lack of land rights
If a female farmer has no legal right to own or control land, she also doesn’t have the legal backing to make decisions about the land or negotiate farm agreements.
