El Agribusiness and Food Center of the Universidad Austral presented the data of the Latest National Survey of Argentine Agricultural Producers, an applied research project that reveals what Argentine producers are like, how they think, how they buy, how they get information, and how they finance themselves.
Agricultural producers continue to invest in growth, despite the constant obstacles caused by the country's economic instability. The business model favored by those in the agricultural sector is capital-intensive and based on their own land: today, 42% work on their own land.
The data is provided by the Agribusiness and Food Center (CEAg) of the Universidad Austral, in the new edition of the Survey of the Needs of the Argentine Agricultural Producer (ENPA), which was presented last Tuesday, November 1st, within the framework of the National Agricultural ConferenceIn 2017, 61% worked at least part of their time on leased land, while now that percentage is 58%, indicating that the The downward trend in the leased-field production model continues over the years.
“The new business model is more capital intensive, generates operations and products of value added and it implies integration with other actors in the value chains,” he explains. Bernardo Piazzardi, professor and researcher at the Universidad AustralHe adds that "this new model not only boosts the development of its protagonists, but also of the linked value chains and the locations where the operations take place."
The study, conducted in collaboration with Purdue University, USA, provides answers to questions about the characteristics, thinking, purchasing habits, information sources, and financing of Argentine producers. A total of 880 agricultural producers from the core agricultural region of the Humid Pampas (covering the provinces of Buenos Aires, Santa Fe, Córdoba, and Entre Ríos) participated in the fourth edition of the National Agricultural Survey (ENPA), held in June and July 2021. The surveyed area represents 76% of the national soybean production and 70% of the national corn production.
The new business model they are now pursuing has a key success factor: the acquisition, management, and use of data. 73% of producers have data-collecting machinery, and 70% use this data for decision-making—an increase of more than 20 percentage points compared to the results of the previous edition of this study.
Of the 880 producers surveyed: 90% are male, 48.8% have a completed university degree, and their average age is 44. On average, 41% of all producers expect to increase their cultivated area within the next 5 years, 55% will maintain the same size as during the 2020/21 season, and 4% expect to decrease their cultivated area.
“When we analyze the responses of producers who are in the 18 to 25 age range, that is, the youngest in the sample, we find that no producer in this range expects to decrease the area of their farms, with 65% of that group being willing to grow,” Piazzardi explains.
ENPA points out that younger, more educated producers—those expected to experience the greatest growth over the next five years—are currently operating the largest farms . “This group of young producers, poised for significant future expansion, also differs from its peers in its investment preferences (options linked to value-added activities) and communication methods (prioritizing digital channels compared to their counterparts). They also exhibit distinct behaviors when engaging with technology, data collection and use, and e-commerce,” the report adds.
The recently made investments, already planned for five years, are focused on vertical growth in the value chain, rather than horizontal growth. “Areas such as machinery, technology, training, biodigesters, soybean extruders, and precision agriculture indicate that producers are seeking greater value creation and capture based on innovative and knowledge-based activities,” explains the CEAg researcher.
When asked whether new digital technologies will change the way they do business in the next 5 years, the producers' response is overwhelming: more than 4 out of 5 producers answer yes (an average of 83%) . And the larger the producer, the more they tend to agree with this statement: 90% of large producers and 92% of mega-producers confirm it.
The machinery they use is equipped with instruments that allow them to collect data (precision agriculture) about, for example: yield, moisture, area, density, crop loss, etc. Among medium-sized producers, this value is 66% and increases as the size of the agricultural establishment grows, reaching 90% and 100% for large and mega-producers, respectively.
Regarding the use of data for decision-making: almost 70% answered yes . This data represents a significant increase compared to the results of the 2017 survey, where only 51% of producers responded that they used it.
According to the ENPA, 83% of producers believe that digital technologies will change the way they do business in the next 5 years , especially among larger producers and producers with a more analytical bias.
“Younger and more analytical producers turned out to be the ones who most prefer digital media and social networks. This fact marks a future trend with changes that will be very dynamic and will take place in short periods of time,” says the professor and researcher from CEAg.
Finally, regarding online purchases of goods and services, although 70% of producers have not yet purchased agricultural inputs online, 8,5% of producers already regularly acquire inputs through this channel, especially producers between 35 and 54 years old.
“The findings related to the business model raise the question of whether other public and private stakeholders, directly or indirectly linked to producers, will support this change to ensure the new model is competitive and sustainable. This is something we will see unfold over the next four years,” Piazzardi concludes.
