Agrarian trajectories in Argentina and Brazil: multilatin seed firms and the South American soybean chain

ABSTRACT

Since the turn of the century, Argentinian seed firms have been internationalizing their operations, focusing on neighbouring countries, specially Brazil. A ‘flex crop’ such as soybean has constituted a central focus for their investment. This article analyses investment opportunities and different intellectual property rights as key drivers of internationalization, and examines the ability of firms to develop networks that are both ‘inward’ and ‘outward’ in their orientation, as well as the tensions involved. The analysis points to the emergence of South-South flows of capital that aim to strengthen their position within key components of agri-food chains, and the formation of transnational elites grounded in global circuits of accumulation.

KEYWORDS:

• Argentina
• Brazil
• soybean production
• seed industry

Acknowledgements

The author would like to thank technicians, government officials, and firm representatives for their participation in personal interviews. The paper greatly benefited from the comments made by anonymous reviewers and the editors of the Special Issue. The author would also like to thank BRICS Initiatives in Critical Agrarian Studies (BICAS) for providing funding to carry out this research.

Disclosure statement

No potential conflict of interest was reported by the author.

Notes

1. Flex crops are agricultural products that can be used as food, feed and biofuels, and which can be changed flexibly according to circumstances (Borras, Franco, Kay, & Spoor, 2011). In the MERCOSUR countries maize, sugarcane and soybean are good examples.

2. Following Bastian and Soihet (2012) reprimarization can be defined as an increase of the share in exports of primary and manufactured products with low value added and/or low technological content. Neo-extractivism is a model of development based on the appropriation of nature, which sustains a barely diversified productive structure and involves the insertion of a country into the world economy mainly as a provider of raw materials.

3. A multilatin or global latina firm has been defined as a company with its origin in a Latin-American country that has value-added operations outside its country of origin (Cuervo Cazurra, 2010). In this article, I follow the more restrictive definition suggested by ECLAC (2006, p. 63), which considers ‘trans-latins’ as emerging Latin American transnational firms that have made direct investments outside their home countries.

4. MERCOSUR (Common Market of the South) was created in 1991 when Argentina, Brazil, Paraguay, and Uruguay signed the Treaty o Asunción, establishing the free movement of goods, services, and factors of production between countries.

5. The term ‘internationalization’ of firms adopted throughout the article refers to the development of international operations, basically investment in foreign countries.

6. Soya oil was originally developed with US state subsidies to supply the margarine industry. After World War II it became more important as a joint product of soya meal for the intensive livestock industry. With the Soviet purchases of the early 1970s, prices soared and the US government feared domestic shortages, placing a temporary embargo on soybean exports. Brazil and Argentina cut into world exports (Friedmann, 1992).

7. The income from agricultural export taxes (mainly from soybeans) has oscillated between 13% and 6% of total state income in the 2008–2014 period (http://www.mecon.gov.ar/sip/).

8. Nidera bought Asgrow Argentina in 1988 and began its activity as Nidera Seeds. Asgrow International had access to Monsanto’s technology through an agreement between the two companies secured in the United States in the late 1980s (Brieva, 2006).

9. Despite these factors, over the past decade TNCs have developed a greater interest in the Argentine soybean seed market, a process that is linked to the possibility of changes in the regulatory context such as a shift to a much stricter intellectual property regime.

10. The Cerrado biome is located in the central part of the country and covers approximately 204 million hectares (or 24% of Brazil’s entire land area). An estimated 40–50% of the Cerrado is under productive use, and by 2008 accounted for 59% of Brazil’s coffee production, 55% of its beef, 54% of its soybean, 28% of its corn, and 18% of its rice (Trigo, Cap, Malach, & Villareal, 2009).

11. Seed companies favour changes in the Argentinian legal framework to ensure the recovery of intellectual property rights, thus restricting the right to save seeds to certain categories of farmers. In 2003 a state initiative intended to adopt a new law to govern the production and sale of seeds did not succeed, but a new attempt in this direction began in 2012, after the approval of a second generation of transgenic seeds with stacked traits. Some seed companies have also entered into private contracts with producers that allow them to collect extended royalties for farm-saved seeds. However, the system has limited coverage due to the resistance of Argentinian producers’ organizations (Filomeno, 2013). According to a seed firm representative, 38% of the seeds sown in Argentina have recognized intellectual property rights to them (considering the sale of both certified seeds and royalty payments). In Brazil, this reaches 60%; in Uruguay, 100%; in Bolivia, 65%; and in Paraguay, 40%.

12. This type of arrangement implies that the tenant gives the landowner a percentage of the crop harvested instead of a cash payment in advance.

13. Soybean varieties are classified for their morphological growth habit, and for their day length and temperature requirement to initiate floral or reproductive development. A short-cycle variety matures in 90 to 100 days, which is two to three weeks earlier than the traditional varieties, allowing farmers to plant a second crop after the soybeans are harvested.

14. These facilities are already undertaking 3,000,000 analyses per year, while in Argentina they can only process about 300,000 samples annually.

Additional information

Notes on contributors

Clara Craviotti

Clara Craviotti is a Research Fellow of the National Council of Scientific and Technical Research (CONICET) and Professor at the Master in Agrarian Social Studies of FLACSO-Argentina. She is a Sociologist with a PhD in Geography (University of Buenos Aires). Her current research interests are the delocalization and relocalization dynamics of agri-food and the changes in the agrarian structure of the Southern Cone countries, with a focus on family farming.