Introduction To Agribusiness Management: A Course Pack For BSAB Students

Introduction to
Agribusiness
Management
A Course Pack for
BSAB Students
1
MODULE 1: AGRIBUSINESS MANAGEMENT SYSTEM
Module Overview
Hello everyone! Welcome to this course, The Introduction to Agribusiness Management.

This self-instructional module is especially written for you, students of agribusiness
management, to supplement your reading materials needed through online class. This
module may serve as the way and the light into an easier study of agribusiness
management. This is composed of three (3) units. The first unit deals the Agribusiness
Management System which is divided into three (3) chapters. This unit will help you
understand and appreciate the processes in different system in the agribusiness
commodity approach.
Lesson 1: Scope of Agribusiness
Learning Outcomes:
At the end of the lesson, the students are expected to:
1. Examine the concept of input sector in farm services which

significantly entails the services and allocation for farm production
sector.
2. Identify best practices under output sector processing on farm
management.
Time Frame: 2nd – 3rd week
Introduction
This module is divided into three (3) chapters. The first chapter is focusing on
the scope of agribusiness which is organized to help you, students, understand
the basic concepts and processes involve in the agribusiness management
system. This chapter may help you to appreciate how agribusiness operates and
its essence. A pretest activity is given in order to activate background
knowledge needed to easily understand the topic that will be discussed as well
as an application of the topic at the end of the discussion.
2
Activity
Exercise No. 1
Look around and see:
1. Kindly write down significant roles of the farmers in your locality. You
may identify also agricultural farms in your area which helps the locality
developed.
3
Analysis
Exercise No. 2
Learning Activities:
1. Think this over. What are the advantages and disadvantages of being
engaged in agro-related industries as compared to non- agricultural
industries?
4
Abstraction
DEFINITION OF AGRIBUSINESS
Agribusiness - this is defined as the sum total of all operations involved in the
production of enterprises of farm, the manufacturing and distribution of farm supplies
and the equalization as well as dispersion services ( such as storage, processing,
standardization, grading, pricking, transportation and distribution) of farm products.
- This includes all economic activities that involve the distribution
and or transformation of the raw materials that are from agricultural
sector and non-agricultural sector whose final product could be used
for agricultural purposes and agro-allied enterprises.
- Can be referring also as to the set of farm and management activities
that involve the production of food, provision of agricultural
products within and outside a country.
Basically, agribusiness in short is a process of transforming any agricultural
commodities into any products that can be profitable based on morality.
SCOPE OF AGRIBUSINESS
There are three (3) Independent Sectors in Agribusiness as follows:
Input Sector – this includes all resources that serve as building units that are
required to service an information process in order to achieve one or more product.
Input sector supplies agribusiness production with the needed inputs in the
production process.
➢ Substitution effect – as input prices increase and farm income
remains relatively stable, producers will reduce their utilization of
the more expensive inputs and substitute other resources inputs for
them.
Example: If machinery is the more expensive inputs, farm form will
use less of it and substitute manual labor for it.
Farm Production Sector – this covers areas such as the aquaculture, forestry, crop
production and livestock.
- Refers also to all activities involve in processing the products.
5
Output Sector– referred as the product sector and the final sector in agribusiness
production and distribution system.
- This is the largest part of the agribusiness sector as its functions
range from product processing to marketing and distribution of
these products to various consumers either as raw materials or
further production or final consumption.
- The main function of product sector is the marketing and
distribution of the outputs from the production sector and
process products to final consumers. This function can be
performed by the middlemen: wholesaler,
producer/processor/manufacturers, retailers and commodity
board and cooperative agents.
- The importance of this sector can be further highlighted by
showing that even when food is abundant, faulty handling and
distribution can make it unavailable to the consumers and
therefore result in food and nutritional insecurity.
AGRIBUSINESS COMMODITY SYSTEM APPROACH
INPUT FARM OUTPUT

SECTOR PRODUCTION SECTOR
SECTOR
SUPPORT MARKETING
Figure 1: AGRIBUSINESS COMMODITY SYSTEM Framework
6
Application
Exercise No. 3
Go and browse online. Pick a commodity of your choice in a particular

agricultural enterprise and kindly provide the input, production and output
sector aspects of the commodity.
Closure
Congratulations! You have just learned the concept of agribusiness commodity system
approach needed for the next lesson. Keep it up! Please bear with this module for the
following lessons to take.

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Introduction to

Hello everyone! Welcome to this course, The Introduction to Agribusiness Management.

Lesson 1: Scope of Agribusiness

At the end of the lesson, the students are expected to:

1. Examine the concept of input sector in farm services which

Time Frame: 2nd – 3rd week

Look around and see:

There are three (3) Independent Sectors in Agribusiness as follows:

AGRIBUSINESS COMMODITY SYSTEM APPROACH

INPUT FARM OUTPUT

Figure 1: AGRIBUSINESS COMMODITY SYSTEM Framework

Go and browse online. Pick a commodity of your choice in a particular

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