40. The Global System of Agriculture

The global supply chain

• helps you understand how food is produced and consumed today

• agribusinesses organized at the global scale

• the rise of the global supply chain in agriculture is due to increased industrialization of agricultural production

  • Interdependence

    • combining individual production with a single multinational agribusiness

    • uses contract farming where the farmer is provided with all the supplies in exchange for a gauranteed price and buyer

  • Globalization of production and consumption

    • small number of multinational companies are creating a monopoly on agricultural seeds and production

      • Monsanto, DowDuPont, etc

    • control major proprietary seed sales

      • no other company can sell the seedwithout paying hefty licensing fees

Export Commodities

• cash crop produced for export to wealthier countries (at expense for crop for local prodcution and distribution)

  • Dependency

    • too much increase in competition

    • leaves populations struggling for basic necessities once are no longer the primary producer in the market

  • Environmental

    • destruction of forests

    • soil erosion

    • loss of soil fertility

  • Food insecurity and Subsistence farmers

    • increase of commercial farming pushes susbsistence farmers on to less productive land, increasing their chances of food deprivation

Other factors affecting global distirbution networks

• Political relationships

  • international political economics is the primary cause of hunger in the world

  • international trade favors farmers in wealthy countries through subsidiaries, which are gauranteed prices for staple crops (and then farmers in developing countries can’t compete with these low prices)

    • and then developing countries face risk of famine

  • misguided government polivies

  • internal government policies

  • tax regulations

• Infrastructure

  • basci physical and organizational structure of facilities needed for the operation of a society

  • colonialism made it so that crucial infrastructure benefitted export commodities in developing countries

  • this disadvantaged the local populations because they weren’t fed by the trains/infrastructure that passed through them

  • when made by colonialism, rule of thumb is that it exploits natural resources and casues starvation

• Patterns of Wordwide trade

  • trade will play an increasingly important role in meeting the food demand

  • developed countries will export larger amounts of food to developing countries and developed countries will accept larger imports from tropical and subtropical areas

  • global trade fluctuates as consumer taste changes and competiiton increases

  • trade blocs help reduce or eliminate taxes and some countries belong to multiple trade blocs