Agribusiness is the business of agricultural production. It is the business sector encompassing farming and farming-related commercial activities. This term is used to refer to economic activities derived from or connected to farm products. The term is a portmanteau of agriculture and business and was coined in 1957 by John Davis and Ray Goldberg. The business involves all the steps required to send an agricultural good to market: production, processing, and distribution. It includes agrichemicals, breeding, crop production (farming or contract farming), distribution, farm machinery, processing, and seed supply, as well as marketing and retail sales. All agents of the food and fiber value chain and those institutions that influence it are part of the agribusiness system. It is a sector that supports the growth of the agricultural industry, which is pivotal to economic growth.
Within the agriculture industry, “agribusiness” refers to the range of activities and disciplines encompassed by modern food production. Agribusiness is a combination of the words “agriculture” and “business” and refers to any business related to agricultural production. There are academic degrees specializing in agribusiness, departments of agribusiness, agribusiness trade associations, and agribusiness publications. Agriculture is the economic sector that employs the most people in the world and the main source of food and income for many people living in poverty. Agribusiness an industry engaged in the production operations of a farm, the manufacture and distribution of farm equipment and supplies, and the processing, storage, and distribution of farm commodities.
Agribusiness refers to farming, but the term oddly is not often used in correlation with actual farms. In the context of agribusiness management in academia, each individual element of agriculture production and distribution may be described as agribusinesses. Instead, agribusiness most commonly means an agriculturally related business that supplies farm inputs, such as machinery and seed supply. However, the term “agribusiness” most often emphasizes the “interdependence” of these various sectors within the production chain. It can potentially improve agricultural productivity, which is why governments often offer subsidies to agricultural businesses.
Agribusiness is a term used to describe the sector that encompasses all economic activities that are related to farming, i.e., chemicals, breeding, crop production/farming, farm machinery, distribution, marketing, and sales. Among critics of large-scale, industrialized, vertically integrated food production, the term agribusiness is used negatively, synonymous with corporate farming. Financing agribusiness can increase the added value of raw materials, strengthening local rural economies, food security and nutrition, and improving the quality of life in many homes at risk of exclusion and vulnerability. As such, it is often contrasted with smaller family-owned farms.