The role of custom farming in agribusiness expansion in Argentina

ABSTRACT

This article aims to examine the role of custom farming in the expansion of the agribusiness model in Argentina, and more specifically, of machinery contractors incorporated into productive ‘networks’ led by large-scale sowing pools and companies. It treats dispossession as being in a dialectic relationship to productivity, thus posing the question of labour as a core discussion in this process. Its purpose is to provide an insight into agribusiness that, while remaining critical, can be constructive for discussing the development implications of this model in the public arena.

KEYWORDS:

• Custom farming
• machinery contractors
• agribusiness
• labour
• development
• Argentina

Acknowledgements

This is an enhanced version of the paper presented during the Journal of Peasant Studies 1st Writeshop-Workshop in Critical Agrarian Studies and Scholar-Activism that took place in Beijing, China, in July 2019. I would like to thank Shapan Adnan, Chunyu Wang, Diana Aguiar and other members of the Collective of Agrarian Scholar-Activists from the South (CASAS) for their comments, as well as the thorough work of anonymous reviewers. I also want to thank Harriet Friedmann for encouraging me to write about this subject and Carla Gras for accompanying the previous work leading to this article.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

1 Though, when some megacompanies ‘translatinized’ thanks to international funds’ investments, they started buying more land in other Mercosur countries.

2 I refer to the EAP (explotación agropecuaria), the NAC statistical unit, as the ‘farming unit’.

3 This was enabled by changes in land leasing contracts (Congreso de la Nación Argentina 1980), allowing for the establishment of one-year contracts between the same natural or juridical persons over the same piece of land indefinitely.

4 This region, also called ‘core zone’, where capitalist agriculture developed earliest, comprises several provinces (Buenos Aires, the south of Santa Fe, Córdoba, Entre Ríos, and the north of La Pampa), and is considered a paradigmatic example of recent territorial and socioeconomic transformations in the agrarian model.

5 Needless to say that the word extrativista is traditionally used to designate Brazilian hunter-gatherer communities, among other related definitions (UICN 1995, 3).

6 This is why some authors hypothesise that ‘contracting is a sub-product of agricultural production concentration (…) in the Pampean region. In other words, it is a social distillation of the decomposition of the classical farmers’ world’ (Villulla and Amarilla 2011, 75, translation by the author).

7 According to the agricultural censuses of 1988 and 2002, during this intercensal period, 21% of farming units disappeared – this percentage was almost 27% for the 0.5–200 hectares stratum, normally family farms– and the average size of remaining farming units increased by 25.3%.

8 Other names for labour contractors in Latin America are: empreiteiros in Brazil, enganchadores in Bolivia, México and Argentina, but there are differences among these labour intermediaries (Fernández Rondoni and Piñeiro 2013, 143). At the beginning of the century, the presence of machinery contractors in other countries of the region was not as common as in Argentina. However, the arrival of Argentine companies in Uruguay had a lasting effect, creating a machinery services market (Figueredo, Guibert, and Arbeletche 2019). This type of labour outsourcing is expanding to other Mercosur countries such as Paraguay, Bolivia, and Brazil (were subcontracting was legalized in 2015). It is also present in other regions, whether related to small-scale farming in Asia (Chang, Takahashi, and Yang 2017), Africa or Latin America (Kahan 2008), or larger-scale farming in the United States (Edwards 2016) or Russia (Rylko and Jolly 2005).

9 The large majority of rural contractors are male.

10 Since 2000–2003 they have started renting lands to amortise machinery investments. According to Lódola and Fossati (2004, 7), ‘production contractors’ could otherwise be categorised as agricultural producers, depending on their main income activity at any given moment.

11 The number of hectares cultivated through contracted machinery can exceed the total hectares cultivated because a farm can contract multiple services more than once a year for the same piece of land, which will then be counted multiple times for measuring this variable.

12 In their comparative analysis of 1988 and 2008 agricultural censuses, García, Cavagnaro, and Lombardo (2018) had shown the increase in the average area cultivated by contractors.

13 This could also be related to the multiplication of agricultural tasks contracted by each farming unit. In any case, despite possible errors in the estimates or net undercounts, the loss of farming units since 2002 is severe: almost 25% disappeared at a rate of 5,000 farming units per year.

14 This is especially so for Buenos Aires province. Specialised (‘pure’) contractors working in large-scale operations do not necessarily live there, in contrast, for example, with regions characterised by the presence of chacareros such as Santa Fe province, where medium-sized farmers tend to exchange services among themselves (García, Cavagnaro, and Lombardo 2018).

15 According to Ernest Mandel, due to the tendency of ‘equalisation of the average productivity of labour’, capital is under ‘permanent pressure to accelerate technical innovation. For the dwindling of other sources of surplus profit inevitably leads to a constant hunt for “technological rents” [which are] surplus-profits derived from a monopolisation of technical progress’ (Mandel 1976, 192).

16 A paradoxical example of this is the creation of the Amanecer Reciprocal Guarantee Society (RGS) in 2004, to advance working capital and finance technological updates and innovations for their service providers, which are SMEs. The RGS seeks funding opportunities to offer loans to services providers (Sosa Varrotti and Gras 2020). In exchange for the loans, contractors have to deliver a portion of their produce to Amanecer (which has a strong storage branch) and, at the same time, the megacompany gains financially (due to the difference in the rates of loans taken by the company and the rates given to the SMEs).

Additional information

Notes on contributors

Andrea P. Sosa Varrotti

Andrea P. Sosa Varrotti, PhD in Social Sciences (University of Buenos Aires, UBA) and PhD in Rural Studies (University of Toulouse II – Jean Jaurès). Postdoctoral researcher at the National Scientific and Technical Research Council (CONICET). Member of the Rural Studies and Globalization Program (Programa de Estudios Rurales y Globalización, PERYG) at the Institute of Higher Social Studies, National University of San Martín (IDAES-UNSAM), Argentina. Lecturer at UBA. She studies the financialization of agriculture, land grabbing, entrepreneurial practices and discourses, and business models. Her research is currently focused on agroecology, food sovereignty, and green grabbing.