Argentina’s organic production. Importance & evolution of family farmers. Main market insertion strategies of Argentine organic
products.
Nora Liliana Puppi, Diego Esteban Pinasco; Juan Carlos Ramirez National Agri-food Health and Quality Service, University of Buenos
Aires, School of Agronomy - SENASA, FAUBA- Argentina [email protected]
Argentine Republic has an official control system ü Since 1992 under the orbit of the SENASA
ü National Agri-food Health and Quality Service.
ü The current system in force is third-party quality certification, like in other important organic production countries
The certification bodies (CBs):
Must be licensed by SENASA¨- Argentina’s National
Agri-food Health and Quality Service,
CBs freely determine the costs of the certification
services the organic operators are faced with.
In some cases, these costs have been assumed by
the State as a strategy to promote the activity for
groups of small producers.
Argentine Republic has an official control system
Organic products of vegetable origin certified and producers ü The trend shown by the harvested area and by the
volumes of organic vegetables products certified in Argentina between 2009 and 2014 was a positive one (4% and 6%, respectively).
ü The total amount of operators under control during the same period, fell, in average, 10% annually
ü On the other hand, organic exports, that constitute the main destination of the production, increased 35% during that same period.
SENASA – Dirección de Calidad Agroalimentaria Coordinación de Productos Orgánicos
Tons
Argentina.
Argentine exports
• 2014: 169 mil tons
Destino Toneladas % EEUU 88.981 52,6%
UE 49.267 29,1%
Suiza 1.916 1,1%
Japón 616 0,4%
Others 28.333 16,8%
SENASA – Dirección de Calidad Agroalimentaria Coordinación de Productos Orgánicos
Organic farms (OFs) under control. Mean area by farm. • In 2009, there were 1894 OFs under control and
in 2014 there were 1217; therefore, the mean
area by farm increased at a rate of 3% annually
during that time.
• The decrease of the number of OFs under
control causes concern for the Argentine
Government and, is a trend found in the
Argentine farming sector.
Argentina Organic farms under control
SENASA – Dirección de Calidad Agroalimentaria Coordinación de Productos Orgánicos
Farm
s
Argentina. Organic Farms Under control
Región Establecimientos
Cuyo 198
NEA 428
NOA 124
Pampeana 228
Patagonia 239
Total 1.217 Area under control (2014)
3.061.965 ha
SENASA – Dirección de Calidad Agroalimentaria Coordinación de Productos Orgánicos
Objetives v The evolution of the OFs in Argentina during the
last six years is analyzed so as to infer which kind of OF is most affected by the process of concentration.
v The OFs that are still in business and their relationship with different commercialization strategies are identified. Special interest in those of a smaller size operating under the protection of various kinds of institutions.
v We assume that most of the family OFs in Argentina
fall into that stratum.
Methods and materials v The information used was taken from data
provided to the Argentine National Agri-food Health and Quality Service by licensed CBs in the Argentine control system.
v The 2009-2014 period was analyzed. v Each record corresponds to one OF, and, it
includes: year, legal form ; fictitious name of the OF, geographic location (Province and Region ), total area (ha), area (organic) under control (ha), activity (agriculture and livestock)
Methods and materials
After an initial analysis, three strata were established according to the surface under organic follow-up:
o Small, OFs with a surface under 25 ha; o Medium, with a surface from 25.1 to 500 ha, o Large with over 500 ha.
Methods and materials
The records were classified by legal form into three groups:
Ø 1)Corporations, which fall into administration
modes that imply a certain management of the exploitation, financial provision and level of capitalization that family farmers do not attain;
Methods and materials The records were classified by legal form into three groups:
Ø 2) LLC and De Facto Business Associations, that could correspond to capitalized family farms, and individuals, into which family members with different levels of capitalization and small & medium-sized businessmen would be included;
Ø 3) cooperatives and associations of various kinds, as it is inferred that this last group would include the majority of the organic family farmers in Argentina.
Methods and materials Ø The data of size strata, legal forms,
geographical region & activity were linked so as to try to explain the influence of these variables in the evolution of the number of OFs.
Ø Then, the ratio of OFs that continued under organic follow-up during the period was calculated, identifying those that were under control of de CBs in 2009 as well as in 2014.
Results and Conclusions
In the three surface strata the number of OFs decreased:
v the fall was sharper in the Small and Large-sized ones (47% and 41% respectively)
v compared to the decrease of the Medium-sized ones (14%).
v thus, the participation of the Medium-sized farms raised from 27% (2009) to 37% (2014) of the total analyzed establishments.
Results and Conclusions
q Production is organized under different legal forms.
q The results show us that the principal form was the corporations- the largest in number (30%),
q Next the Producers’ Associations (28%), Individuals (27%) and LLC (9%).
q But it is important to say that all of them decrease since 2009 to 2014.
Results and Conclusions Legal Forms Analyzed: Regional distribution and by stratum. (2009)-2014)
Legal form Region where it is Predominant Activity Stratum
Cooperatives and
Associations (a)
The Mesopotamia Agriculture Small (a)
LLC, De Facto
Business Associations,
individuals (b)
The Pampas Agriculture
Large (b1) and Medium (b2) Small (b3) and Medium (b4) Cuyo
Northern Patagonia Small (b5) Southern Patagonia Livestock Large (b6)
Corportions and Trusts (c)
The Pampas
Agriculture
Medium (c1) and Large (c2)
Cuyo Medium (c3) and Small (c4)
Northern Patagonia Medium (c5)
Evolution of the number of OFs, according to their legal form, stratum and by region (2009-2014)
Stratum
2009 2010 2011 2012 2013 2014 Variation
a) 447 428 338 252 215 192 -57% b1) 57 62 54 40 28 19 -67% b2) 71 65 51 37 27 28 -61% b3) 100 87 94 69 49 39 -61% b4) 52 50 56 48 49 45 -13% b5) 90 89 87 79 79 86 -4% b6) 48 51 51 43 33 29 -40% c1) 50 56 54 52 54 55 10% c2) 36 37 38 30 32 29 -19% c3) 64 65 58 61 56 56 -13% c4) 68 66 44 38 28 25 -63% c5) 53 52 41 39 32 33 -38%
Results and Conclusions The Pampa Region, where the production is mainly annual crops (commodities), shows a decrease in all the strata of the OFs, except the group of corporations and, they are medium-sized establishments.
Results and Conclusions In Cuyo, under the two predominant legal forms in the region (LLC, individuals), the OFs that belong to the small stratum decrease more than those of the medium-sized stratum. Therefore, their evolution (decrease) would not be related to their legal form.
Results and Conclusions In the Northern Patagonia Region, with a production of apples and pears, very important in the Argentine exports of organic products, it is found that the OFs managed as corporations decrease more than the group of LLC, De Facto Business Associations and individuals.
Results and Conclusions Northern Patagonia Region: it is found that the articulation of production with the foreign markets takes place through packaging facilities, like cooperatives or large exporting firms, with great insertion in the international market.
Results and Conclusions The Mesopotamia Region, register a large decrease in number of OFs. This, would indicate that the support given by the institutions, that in some cases bear all the quality certification costs, and let the producers' insertion into the foreign market, was not enough to avoid the exit of small producers from the system.
Results and Conclusions
Regarding the activities carried out by the OFs, ü most of the smaller ones are in the
agricultural farms ; ü the medium-sized establishments,
although they are mostly agricultural, some are livestock breeders,
ü and, the large OFs are, agricultural or breeders in the same percentage.
Results and Conclusions ü In general, family producers would be
into the groups of associations and cooperatives, and also into the group of individuals as family producers, with different degrees of capitalization.
ü They are raw material providers to manufacturer or packaging establishment, which assists the family producer with management, technical advice and logistics.
Results and Conclusions
ü Finally, it was observed that in
the analyzed period the medium OFs corporations related to agricultural activities were the most able to sustain over time.
!Thank you ¡