The Pros and Cons of Agribusines

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I. Introduction

Agriculture has long been a topic of interest and will continue due to the necessity of

farming to supply a basic fundamental need – food. Farming is considered a stable economic

activity as it provides products, jobs, and supplies to the local community as well as supporting

the global infrastructure. The recent global economic conditions have caused an array of

structural changes within the global infrastructure. These structure changes have directly

impacted banking institutions, housing, lending processes, farming sectors, and privatization.

The declining housing market, corrupt banking/financial institutions, and decline in stable

investments have increased the need to find economically viable ways to invest. Investors look

at markets for sustainability and lucrative return on investments (ROI) while attempting to

minimize risks. Naturally – food and water have become commodities but investors are still

interested in returns and farming losses are often offset by federal subsidies and crop insurance

(Lynch & Bjerga, 2013). Corporate investment, government regulations, and privatization

become issues while trying to improve ROI. The recent water wars are evidence of control

issues and an attempt to purchase natural resources. Investors are now looking at ways to

promote diversity and sustainability to their clients while countries are grappling to ensure food

security. Farmland investments involving large-scale acquisitions are lucrative for investors.

Large-scale acquisitions of farmland in Africa, Latin America, Central Asia and Southeast Asia

are now being sought by international investors and have garnered global attention (Cotula,

Vermeulen, Leonard, & Keely, 2009). Farming, agriculture,...

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...ences (continued)

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Lynch, D. J. & Bjerga, A. (2013, September 9). Taxpayers turn U.S. farmers into fat cats with subsidies.

Bloomberg. Retrieved from


Lynch, D. J. (2013, September 11). Fraud stealing $100 million shows flaws in U.S. crop insurance.

Bloomberg. Retrieved from


Sherrick, B. J., Mallory, M. L. & Hopper, T. (2013). What’s the ticker symbol for farmland? Agricultural

Finance Review, 73(1), 6-31. doi: 10.1108/00021461311321285
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