Chains (Agribusiness Systems)
Analysis and Methods
Chapters: 25, 26
Prof. Dr. Marcos Fava Neves
University of São Paulo, Brazil
Visiting International Professor at Purdue University
1
The ChainPlan method for strategic
planning and management of chains
1
Initiatives of
Leaders,
Government,
and
Research
Institute/
Universities
in planning
the future
of the Chain.
2
3
4
Description,
Mapping and
Quantification
of the Chain
Creation of a
Vertical trade
Association
Elaboration of
the Strategic
Plan for the
Chain
5
Management
of Strategic
Projects
2
SUGAR-CANE CHAIN IN BRAZIL
GDP in 2008: USD 28 billion; Financial Movement of the Chain in one year: US$ 86 billion
Gross Revenue
Before Farms
Farms: Production
USD 9.252,42 mm
USD 11.509,75 mm
Fertilizers
USD 2.259,09 million
INDUSTRY/DESTILLERY
USD 22.639,17 million
Sugar cane Production
Own:
USD 6.387,91 million
Suppliers:
USD 5.121,84 million
Defensives
USD 768,44 million
Lime
USD 50,56 million
Auto-parts and
maintenance services
USD 2.851,19 million
After Farms
Industrial Inputs: USD 6.414,39 mm Industry: USD 22.639,17 mm
Ethanol Distr.: USD 19.738,56 mm Sugar Distri.: USD 4.003,15 mm
Equipaments
USD 3.400,99 million
USD milhões
Ethanol
USD 12.417,36 million
Internal Market
USD million
Steam Generator: 667,13
Hydrous: 6.615,58
Extraction: 568,13
Resale and
Cooperatives
USD 477,54 milhões
com defensivos
Harvesters
USD 426,52 million
Not Energy: 438,78
Sugar Industry: 354,38
Mercado Externo
Hydrous : 1.179,91
Maintenance: 655,98
Anhydrous : 1.210,20
USD 269,76 million
Beverage industry and
cosmetics
USD million
Assembly: 411,75
Automation/Instrumentation
Tractors
USD 320,87 million
Sugar
USD 9.765,08 million
Internal Market
USD million
Electrical Installations
USD 366,00 million
Attachments
USD 425,66 million
Industry: 2.037,88
Wholesale: 580,57
Building
USD 594,75 million
Trucks
USD 331,36 million
Assembly Services and
Maintenance
USD 1.110,35 million
Bodies,
trailers and semitrailers
USD 233,36 million
Wholesale
USD 743,89
million
External market
USD million
Free
Consumer
Gross Sugar: 3.649,55
White: 1.833,41
Bioelectricity
USD 389,63 milhões
Diesel and Lubricants
USD 1.054,01 million
Fuel oil and lubricants USD
94,19 million
PPI
USD 53,80 million
Bags
USD 45,42 million
Internal Market
Big Bags
USD 14,67 million
External Market
Distributor
Yeasts and Additives
USD 63,61 million
USD million
Feed Industry: 21,41
Feed industry
USD million
Feed Industry: 42,20
Lab materials
USD 15,46 million
PPI
USD 38,96 million
USD 13.275,58 mm
Carbon Credit
USD 3,48 million
Bio plastic
(non commercial scale)
Facilitating agents – USD million
BNDES: 3.530,79
Port Cost (Santos): 213,52
payroll : 738,33
CCT Outsourced 1: 916,32
R&D: 79,15
Health plans 3: 125,51
Road Export Freight: 539,03
Events: 5,32
Meals4: 188,26
1- South Center region. 2- Exports by Portos de Santos e Paranaguá. 3 e 4 – Only São Paulo state.
Source: Neves, Trombin, Consoli, 2009.
Retail
USD 3.259,26
million
Food industry
and other
Retail: 1.663,66
Quimical Products
USD 463,82 million
Facilitating agents
Gas Station
USD 11.114,50 million
Anhydrous: 2.972,89
Distillery: 469,13
Energy Generator: 274,5
Distributor
USD 8.624,05 million
Exports Toll (Santos): 79,96
Magazines: 3,99
Aggregates tax in SAG: 6.8 billion
Special
Consumer
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Sumary of ChainPlan plan (step 4)
Analysis of
Internal
Situation and
Competitors
6
Communications
Projects
7
Distribution and
Logistic
Projects
Human Resources
and Qualification
Projects
8
9
11
12
STRUCTURE THE GOVERNANCE
(EXECUTION)
OF THE CHAIN PROJECTS
3
5
CHAINPLAN BUDGET
Market Analysis
with the Chain
Approach
4
STRATEGY FOR THE CHAIN
2
OBJECTIVES FOR THE CHAIN
INTRODUCTION AND UNDERSTANDING
1
Production, Products,
Research and
Development, and
Innovation Projects
Institutional
Environment
and Coordination
Projects
10
4
5
FINAL
CONSUMERS
How will the
consumer look like?
What will be value
for them?
How new products
can affect the
market?
What are the trends
in income?
What will be the
effect in developing
and emerging
countries?
What changes will
occur in buying
behavior (conscious,
environment,
sustainable)?
How demographic
trends affect
consumption?
How preferences
will change?
How will be the
acceptance to
GMO’s and other
technologies?
DISTRIBUTION
What are the
trends in retailing?
Will retail
concentration and
global operation
movement
continue?
What to expect
from private
labels?
Which will be the
effects of
technology and
price
transparency?
Which will be the
policies toward
supply chain
(purchasing)?
How competition
among retailers
will affect the
chain?
What will be the
role of
foodservice?
MARKETING
INDUSTRY
FOOD INDUST
Which will be the
speed of New
Product
Development
(NPD)?
How will
consolidation look
like?
How will costs
margins and
profitability of
product-lines look
like?
How will be the
relationship with
retailers and agroindustry?
What are the roles
of regional
companies?
Who are the new
players diversifying
to this market?
Which is the growth
expectation for this
industry?
How to solve the
logistics problems
to supply the
emerging markets?
PROCESSING
INDUSTRY
AGRO - INDUSTRY
How industry will
be the structured?
Will the agroindustry be
concentrated?
The agroindustry
would operate in
global scale?
How would be the
logistics to the
clients and
purchasing
behavior?
Who will be new
players?
Where they may
come from?
What will be the
degree of own
production of
inputs?
How will operating
costs and margins
look like?
FARMERS
How production
will be structured?
How will
concentration
happen?
Will it be more
professional?
What will be the
most competitive
areas in the world?
Which are the
growing areas and
declining areas?
What will be the
role of
cooperatives and
associations?
Crops will be
substituted in
some areas?
How plagues and
diseases will affect
the chain?
How to expect
from regulation
changes?
How production
costs will look like?
INPUTS
SUPPLIERS
What innovations will
come to market?
What movements
upward the supply
chain will be done?
How will the selling and
distribution channel
structure look like?
The concept of offering
integrated solutions for
farmers will be the
most suitable one?
How will the situation
of genetic modified
organism (GMO) be?
6
 Question of the day
Based on the list of major uncertainties (PEST), choose a product
(chain) and list 10 major challenges you seen in 2026…
7
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