A Brief Introduction into
the Complexities of an Agribusiness Sector
I. Introduction
There are numerous aspects of producing and marketing an agricultural good in California for the US market. Success depends on a number of things which can include:
Agricultural goods are constrained by biological factors that many, if not most, manufactured goods are not subject to. This means that while technology can accelerate production of many manufactured goods, agricultural products ultimately depend upon land, water and sun and there are definite limits as to how much we can manipulate these factors of production to quicken the growing process.
- biological factors;
- psychological factors; and,
- economic factors.
Just as there are differences between agricultural goods and manufactured goods, there are often many differences between any two agricultural goods -- even though they are both constrained by biological factors. The fact that some crops grow better in some areas often translates into the possibility that crops that grow more easily in certain areas will also be more profitable in those same areas.
To understand the various characteristics of an agricultural
market, this small tutorial will briefly explore the production of avocados
for the US market, the constraints under which the producers must operate
and ways in which producers and packers are dealing with some of these
constraints.