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What Changes Are Possible in World Agriculture in the 21 st Century?

What Changes Are Possible in World Agriculture in the 21 st Century?. Agriculture’s New Era. A new era in agriculture created by drivers . These drivers are revolutionizing the industry and permanently altering traditional relationships.

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What Changes Are Possible in World Agriculture in the 21 st Century?

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  1. What Changes Are Possible in World Agriculture in the 21st Century?

  2. Agriculture’s New Era A new era in agriculture created by drivers. These drivers are revolutionizingthe industry and permanently altering traditional relationships. Farm businesses that recognize, understand and pro-actively adapt to the WORLD’S needs will growand prosper.

  3. Drivers of Change • Globalization of Markets and Resources • Consumers’ Evolving Preferences • A More Demanding Food Industry • Government Interaction/Regulation • The Pivotal Role of Technology

  4. World Population Growth Populations continue to rise … End of the Cold War has allowed countries to reallocate resources and increase standards of living. Growing incomes allow people to buy more and better quality food (changing preferences).

  5. Drivers & The Farm Business Globalization Consumers Food Industry Technology Government The Farm Business Environment ??

  6. The New Agriculture …Farm Business Environment • International Markets • Commercialization/Biological Manufacturing • Ecological Agriculture • Differentiated Products • Food Supply Chains • Information/Precision • Risk • Diversity

  7. International Markets • New Markets in Old Places • More Liberal Trade Environment Competitive Pressure ! • Global Access to Technology • Increased World Wide Production Capacity • Global Sourcing and Selling

  8. Percent of World Grains and Oilseeds Produced in U.S.

  9. Commercialization Commercial (Industrialized) Mentality • Full Utilization of Resources • Managing Inventories • Specification Buying • Outsourcing • Process Control Technology

  10. Process Control Technology • Monitoring/Measuring and Information Technology • attribute traceability throughout the chain • Biotechnology/Nutritional Technology • manipulation of attribute development and deterioration • Intervention Technology • anytime intervention if attribute development deviates from potential (gap resolution)

  11. Ecological Agriculture • Total Biological Systems • Recycling Nutrients • Capturing Value from Byproducts • New Revenue Streams • Carbon sequestering • Environmental amenities • Wildlife/wildlands

  12. Differentiated Products • More Differentiated, Less Commodity • More Attribute Driven/Value • More Traceability/Identity Preserved • Types of Products • Generic commodities • Enhanced component commodities • Specific attribute raw materials

  13. The Food Supply Chain • More End-User Responsive • Better Flow Scheduling • Improved Quality Control • Food Safety-Traceback • Competitive Advantage? Sustainability? • Who Will Control?

  14. Information/Precision • Monitoring/Measuring Technology • Smarter Machines • Process Control/Quality • Span of Control

  15. Risk • Operating/Tactical Risk • More volatility • Short peaks, long troughs • Strategic Risk • Relationships • Environmental • Policy changes

  16. Diversity • More Differences Between Farms (no typical farm!) • More Market Segments • Customized Solutions • More Conflict/Confrontation

  17. Business Models • Independent Producers • Multiple Plant Entrepreneurs • General managers • Plant managers • Workers • Franchise Growers • Network Qualified Suppliers • Piece Work Contractors

  18. Management Skills Areas • Strategy • Production • Finance • Procurement/Merchandising • Personnel • Leadership

  19. Successful Strategies? • Develop a Strategic Direction • Adopt New Technology Appropriately • Control Cost • Evaluate Networks/Alliances/Linkages • Manage Risk • Expand Carefully • Think like a CEO/general manager

  20. Key Challenges in Agriculture’s Future • Adapting to change • Evaluating technology • Achieving profitability • Cost cutting • Growth • Defining organizational capabilities • Achieving organizational transformation

  21. Strategic Business Planning for Commercial Producers

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