Industrial Illegitimacy and Negative Externalities: the Case of the Illinois Livestock Industry

An industry's legitimacy depends on stakeholders' perceptions and assessments of the appropriateness of its behavior across a wide array of settings. While products and services may be highly valued, and in some cases essential, business externalities serve as a powerful counterforce undermining legitimacy. The work draws on the theory of industrial legitimacy and employs a taxonomy of four different legitimacy sub components; pragmatic, regulative, normative, and cognitive. The paper identifies how externalities affect an industry's legitimacy and the relative contribution of each sub component. The research then empirically tests the theory using the case of the Illinois livestock industry.Livestock Production/Industries,

The Brazilian Soybean Complex

Crop Production/Industries, Q13, O54, Q56, 013,

The Farm Business Environment and New Generation Cooperatives as an Innovation Strategy

Agribusiness,

Ten Conversations about Identity Preservation: Implications for Cooperatives

Motivation: While it appears the modern economy demands ever increasing amounts of differentiation, opportunities for grain producers to create and capture significant new sources of value remains elusive. Opportunities appear to loom large to help remove risk and improve quality in the grain supply chain through preservation of product identity, producers, producer groups, and cooperatives are frustrated at the low level of value available to them from IP demand. Why do premiums remain low? And, what is the role of group action in these new differentiated markets? Objectives: This research report helps to explain this apparent paradox underlying the economics of the value proposition for IP grains. Methodology: Needs assessments were conducted on procurement executives using a semi-structured instrument. Results: The study demonstrates that understanding identity preservation business opportunities requires an understanding of the buy-side proposition. Respondents described how they balance the risk mitigation and market uplift features of a supply offering with the risks of narrowing the supply base. A model of the buyer's calculus is constructed. The results show how for producers and producer groups to drive value up the chain they need to shift away from solely a new product focus. Instead attention needs to be directed towards technologies, delivery systems, and organizational models that when bundled with new products make end-users more competitive. A second insight was the limited role of group action in meeting end-user needs. Where value markets existed, internalized groups rather than "arm's length" group transactions were the norm. Plan for Discussion: The cooperative movement was grounded in group action giving individual producers power in the market. The motivation to unite was very clear. In the post-industrial agrifood system though, why do buyers want to purchase from a group? What is the role of the group, from a buy-side perspective, in the modern economy? How should effective groups be structured? Key Words: identity preservation, supply chain management, value creation, group actionidentity preservation, supply chain management, value creation, group action, Agribusiness,

World Soybean Demand: An Elasticity Analysis and Long-Term Projections

Soybeans are one of the most valuable crops in the world and are characterized by their multi-purpose uses: food, feed, fuel and other industrial usages such as paint, inks, and plastics. Out of 183.9 million tons of world supply/demand of soybeans in 2001-03 year, about 10% of them were directly consumed as food (5.9%) or feed (3.8%) but 84.2% of them were crushed into soyoil and soymeal. Soyoil is mainly processed to vegetable oil for human consumption and recently used as a biodiesel feedstock. Soymeal is used not only as feed for livestock (especially for pork and poultry due to its low fiber level) and aquaculture, but also as a good source of protein for the human diet in a variety of forms in different cultures. This paper analyzes the relationship of the demand for soybeans with economy at country and international levels. We use the county level domestic demand quantities with GDP data and apply an error correction mechanism (ECM) to estimate the long-term elasticities of demand for soybeans in the market/economy. Using the estimated long-term elasticities, the demands for soybeans are projected through 2030.soybean demand, elasticity, error correction mechanism (ECM), projection, Agribusiness, Crop Production/Industries, Demand and Price Analysis, Marketing, C22, C53, Q11,

World Soybean Production: Area Harvested, Yield, and Long-Term Projections

Soybean, production, yield, land use, long-term projection, exponential smoothing with damped trend, Agribusiness, Agricultural and Food Policy, Crop Production/Industries, Land Economics/Use, Q1,

China's Meat Consumption: An Income Elasticity Analysis and Long-Term Projections

Bennett's law, China, meat consumption, income elasticity, vector error correction model (VECM), projection, Agricultural and Food Policy, Demand and Price Analysis, Food Consumption/Nutrition/Food Safety, C22, Q11, Q13,

Strategic Positioning Under Agricultural Structural Change: A Critique of Long Jump Co-operative Ventures

This study utilizes strategic management theory to analyze the recent proliferation in non-commodity vertical integration producer-owned businesses in the US. The paper introduces the notion of the Value Creation Triad where ownership, competency, and control need to be aligned for success. Very related to the Triad concept is the differentiation in strategy between long and short jumping. The paper presents an empirical case of successful vertical integration by a New Zealand lamb cooperative.Strategic management theory, Value added agriculture, Vertical integration, Producer-owned enterprise, Core competencies, Tacit knowledge, Productivity gap, Opportunity gap, Agribusiness,

STRATEGIC POSITIONING UNDER AGRICULTURAL STRUCTURAL CHANGE: A CRITIQUE OF LONG JUMP CO-OPERATIVE VENTURES

Structural change in US agriculture has disrupted the traditional organization of the supply chain. Not only does the scale increase of firms common during the industrial period (1970-1995) continue, but also with the rise of a knowledge-based economy, new organizational forms and supply chain linkages are proliferating. Examples are the radical transformation of the relationship between input suppliers and producers in the biotech arena, the dominance of the swine industry by the integrated model, the rise of marketing and production contracting, and the arrival of multi-member closed producer organizations such as the new generation cooperatives and limited liability companies. The focus of this research is these new integrated producer organizations. Much of the activity and subsequent analysis of new producer organizations has focused on value-added opportunities through integration (i.e., Merrett et al, 1999). There are numerous examples from pasta plants and egg breaking, to cattle feeding, hog slaughter, and alcohol production. These value-added opportunities we define as long jump ventures. That is, they lie outside the core competencies of the principles in the firm, the producers. Strategic management theory (Prahalad, 1986,1990,1993; Quinn, 1977,1990; Mintzberg, 1987,1994,1996,1998,2000) suggests that there may be other opportunities available to producer organizations that better leverage their core competencies, short jump ventures. Short jump ventures are value-creating opportunities that involve a minimum R&D, less capital, less risk, and less direct specialized knowledge. While the economy at large is producing vast quantifies of long jump innovations in the fields of biotechnology and information, there is another revolution occurring in business involving short jump innovation in the area of service. This new field, known as; one-to-one marketing (Pepper, 1993, 1999), relationship management (Hansen, 1983), relationship marketing (Curry, 2000), and strategic partnering (Rackam, 1996), focuses on the supplier-client interface. Value is created by significant coordination between supplier and client. The boundary between firms is blurred, knowledge is actively shared, and partners are dedicated to mutual profitability. By understanding the needs of the client, the supplying firm is able to adapt its products and more importantly services. This creates a unique and more valuable business for the supplier insulating it from competitive forces and allowing greater value capture. This not only creates greater supply chain efficiency, but intra-firm and inter-firm product innovation result as well. The objective of this paper is to study strategic options for production agriculture dealing with the failure of the commodity business model. From this analysis of strategic positioning the paper introduces relationship management as a viable strategic alternative for commodity producers. Finally, a case study of the Wairarapa Lamb Cooperative, a New Zealand based firm doing business in the United States, is introduced. The case serves not only as an example of relationship management in agriculture but also demonstrates how producers can work within their own core competencies, leverage knowledge assets, and avoid highly specific fixed assets. The methodology will be: 1) Review the literature as to the types of activities in which integrated producer organizations are engaged. 2) Present a theoretical model of strategy analyzing short jump versus long jump ventures. 3) Introduce Relationship Management. 4) Employ a case study example of the theory in practice. This paper theoretically analyzes producers' vertical integration through "brick and mortar" investments, such as hog slaughter and ethanol production. A theoretical model using strategic management theory and a case study are used to critique the long jump strategy and suggest relationship management as a more viable alternative.Agribusiness,