Defining Agribusiness

Custody explains different misconception on what Agribusiness Is and what Is not. Few people define agribusiness as just farming in the field, fishing in ocean and raising animals. Some of them are aware that it is an entity that engages with activities of processing of agric-products then being marketed to the consumers. But most of them believe that it is just for big companies like Universal Robins Corporation, San Miguel Corporation, Nestle, Cargill and Beetroot. While other people think that It’s Just a domain of private sector for profit objectives, or In academe It Is just for making feasibility studies.

All of these are misconceptions about what agribusiness. To understand what Agribusiness is all about let us look at the definition, its system, concepts and dimensions, different scope and importance of agribusiness in the economy. Definition of Agribusiness Agriculture to most people is Just farming, ranching and fishing then business in the farm Is Just about selling their crops until late asses when Proof. John H. Davis of Harvard university first used the word “agribusiness”. So agribusiness Is not Just about farming system that many people used to know.

Despite the growth and interest in the agribusiness profession, what constitutes agribusiness management research continues to be a perennial debate. Understanding what is or what is not agribusiness management research is fundamentally dictated by its definition. These definition share a common emphasis for various sector of the agric-food supply chain that works towards the production, manufacturing, distribution, and retailing of food products and services (Boer,else, 1999; COOk and Chad, 2000) .

T (2012) denned Agribusiness as the chain of activities that engage in the supply of farm inputs; farm production; post-harvest handling, storage, processing, distribution of farm commodities, the supply of packaging materials, marketing, management and distribution of fresh and processed goods; as well as the financing of various activities. The word “AGRIBUSINESS” is now used and accepted widely In world Including private companies and academic Institution. Evolution of Agribusiness Late sass’s the agribusiness is just self-sufficient farms, for household consumption only.

Years later increases the commodity production demand dour to population Roth. Crop production became a focus of farmers. (They started purchasing inputs; profitable even back then. Lack of marketing orientation is the main problem that’s why the growth of agribusiness sector was slowly developed. Mechanization was developed largely due to labor shortages. Much of the manufacturing and processing was relocated off the farm to become businesses themselves. Preservation of raw products was also improved. This made food more convenient to consumers.

Different food companies were established to sustain the needs of the consumer. The growth of food industry and non-food industry for innovative reduces evolve in this era that helps the agribusiness sector. Today the agribusiness is the no 1 . Sector in the economy. Importance of Agric-business: It deals with agricultural sector and also with the portion of industrial sector, which is the major source of farm inputs like fertilizers, pesticides, machines, processing and post-harvest technologies. It suggests and directs the government and private sectors for development of sub sectors. . It contributes a good part of the national economy. Dimensions of Agric-business:  It deals with different components of both agricultural and industrial sector, their interdependence and influence of one sector on other.  It deals with decision making process of farm either private or government in relation to production and selling aspects.  It deals with strengths and weaknesses off project and thereby their viability in competing enterprises. Agric-business is always market oriented. Structure of Agric-business is generally vertical and it comprises the following .

It involves three important sectors. Leant system (farm): It deals with agro-based industries providing seeds, fertilizers, feed, chemicals etc. The industries supplying machinery or equipment, implements and petroleum etc. Are also important in this regard it deals with the supply of inputs squired by the farmers for raising crops, livestock and other allied enterprises. These include seeds, fertilizers, chemicals, machinery and fuel.  Farm system (production): It deals with production and distribution of farm commodities.

Large cooperative bodies also exist in Agric-business, but they are few in number, whereas small scaled agro-industries are large in number. The vertical integration of a farm is very common in poultry, fruit and vegetable farms. It aims at producing crops, livestock and other products.  Product system (manufacturing): It deals with various aspects like storage, freezing, dehydration and different preservation to prolong the shelf life of commodity during off season. Preservation of processed foods by means of canning, bottling tetra packaging and other processing is the main role of the manufacturing system.

The marketing system distributes all the finished products to meet the dynamic needs of consumers that attain financial success. Support and feedback mechanism The Agribusiness System Input production Marketing Manufacturing sector Sector. Therefore, Agribusiness is sum total of all operations or activities involved in the business of production and marketing of farm supplies and farm products for achieving the targeted objectives. With the support of coordinating mechanism (government, private companies, markets, trade association, financial entities, educational institution and other groups engage in agribusiness sector.

The government agencies, educational institution and other private companies are the support subsystem that will help the agribusiness sector through its technology and programs. Product flow in global agric-food system Figure 2. Shows the product flow in the global Agric-food system The end-user of the agribusiness system stills the consumer. Everyone of us become final consumer cause of the processed commodity be buy in supermarket. All products we consume were passed through the agribusiness system.

For example the processed Hotdogs sausage we consume is first engage in the input system, the animal feed industry and racer provides swine for raising swine provide food and vitamins for the livestock. After the input subsystem it follows the production system were hog raiser produce products for direct consumption or intermediate processing. The processing subsystem (meat industry like purebloods) is responsible for processing; they transform meat into meat products like sausages/hotdogs. The production subsystem plays a very important role in the agribusiness system prior storage.

They need to produce processed products to meet the consumer’s demand. Then after the production subsystem it is followed by marketing subsystem, the marketers, advertiser, traders or distributors are the deliverer of processed products to the final- consumer. With the help of support system like government agencies and other group engage in the system that regulate the policies and programs followed by the 4 subsystem in order to provide a high quality processed Tender Juicy hotdogs in our dining table. The production of sausage was passed the whole agribusiness system.

Agribusiness as a sector According to Valances, The agribusiness sector recognizes as one of the major sectors in the economy for it covers the whole agricultural sector. That agribusiness is composed of the entire agriculture sector and that portion of the industrial sector which contains the sources of farm supplies on the processors of farm products and the commercial sector provides services like financing, transporting, marketing and storage of agric-products. 3 kinds of sector:

1. Agricultural sector- The whole on farm agribusiness included the fishery, crops, loudly and livestock and forestry products.
2. Industrial sector- including the agro industries that support the agribusiness sector through their agro-industrial services.
3. Commercial sector-are financing subsection, transport for distribution and There is no difference of agribusiness in other businesses because it also a trade oriented ventures.

It should be always a profit oriented enterprise that requires production, marketing, management, financing and planning. According to Valances, an agribusiness enterprise must be market oriented and shall always produce beyond family consumption.

Agribusiness is a generic term applied to businesses that involves of agricultural production. The combination of these two disciplines the agriculture and business referring to the activities of modern food production and processing that promotes agriculture sector growth and development through proper management with distribution process, advertising marketing and financial management. Agribusiness as investment should be always treated other concerns like Economic sustainability, social sustainability and environmental sustainability for the firm to stay longer in the business.

Distinctive Features of Agric-business Management

Adapted from agribusiness lecture of Dry. Kumara The important distinctive features or the principle characteristics of agribusiness are as follows:

1. Management varies from business to business depending on the kind and type of business. It varies from basic producer to brokers, wholesalers, processors, packagers, manufacturers, storage proprietors, transporters, retailers etc. ,
2. Agric-business is very large and evolved to handle the products through various marketing channels from producers to consumers.
3. Management varies with several million of farmers who produce undress of food and livestock products
4. There is very large variation in the size of agric-business; some are very large, while many other are one person or one family organization.
5. Most of the Agric-business units are conservative and subsistence in nature and family oriented and deal with business that is run by family members.
6. The production of Agric-business is seasonal and depends on farm production. They deal with vagaries of nature.
7. Agric-business is always market oriented.
8. They are by far vertically integrated, but some are horizontally integrated and many are conglomerated.
9. There is direct impact of gobo. Programmed on the production and performance of Agric- business.

People in many countries flock to the cities, complicating the problem of food, transportation, distribution and marketing. In the developing new nations, this marks the beginning of a shift from subsistence farming to commercial agriculture. The commercial agriculture cannot exist without the support of Agric-business and other industries.

The hungry countries are usually those with the highest percentage of their people in farming. This is because of their farmers are still close to subsistence farming. The role of agricultural economist is to advice farmers on the commodities to be produced and the most economical methods of combining resources so as to maximize profits from the farm.

Role of Food Science and Technology in the Agribusiness Sector

Wisped defines Food technology (Food tech) as the application of food science (science and engineering) to the selection, packaging, distribution, preservation, processing and food scientists rather than engineers. Its main role into the agribusiness sector is basically in the production/manufacturing subsystem of the whole agribusiness system. Food Scientist transforms commodities to a quality food product. The world’s food system provides food for nearly seven billion people each day. But according to a new report from the Institute of Food Technologists (FIT), more advances are critical for an adequate food supply, which must nearly double during the next several decades, for the future world population.

A big thanks to food science and technology and modern food manufacturing methods, nutritional deficiencies and inconsistent food availability can be addressed, harvests can be protected, and various commodities can be transformed into new products having specific nutrients for utter health and wellness,” said John Floors, PhD, of the Pennsylvania State University Department of Food Science. Food science and technology contributed to this success by integrating many disciplines from biology, chemistry, and engineering, to genomics, microbiology, nutrition, and toxicology?to solve difficult problems.