Not all concentration models are valid

Francisco Sánchez, manager of  Onubafruit reflects on business organization models in the agri-food sector.

For some time, we have been hearing about the creation of new companies in the agri-food sector that present new models of concentration. Mergers, acquisitions and takeovers that have me quite interested, as well as a bit worried. Starting from the fact that, to me, all unions between cooperatives, SATs or farmers (especially if they are small) I like, and I do not like, at all, concentrations based only on investment capital in which the the term farmer almost disappeared, I am going to make some reflections, always from of my point of view and with the utmost respect for everyone.

Personally, I believe that the concentration of farmers or cooperatives based on product families, for example, red fruits  is the best way to give more profitability to small and not so small farmers. It is easier to sell 100 million kilos of strawberries than 50, as well as having a large market share opens more doors than a small one.

A large company that brings together a large percentage of a family of products (red fruits, stone fruit, citrus fruits, etc.) gives us more opportunities for the present and for the future. It will provide us with optimal production, marketing and cost ratios and our research will be more concentrated and effective and, furthermore, I do not believe in the idea that large distribution will pay less attention to us if we do not have a wide range of products, on the contrary , we become specialists and that is what every great Food Chain is looking for.

At Onubafruit we are committed to a wide concentration of farmers to be stronger and more profitable, to be more heard, but in a unique or almost unique line of products. There are other very respectable models, and which I also applaud, that base their structure on a wide portfolio of products, believing that this way they will better satisfy the needs of the client.

I believe that there are products that do not add up to others, that unnecessary easements are forced and that cost optimization is not as effective. But great companies have been created with these models, which are giving great satisfaction to their components and I do not stop being happy about it.

But what really puzzles me are the new trends … it seems that AGRO is a safe place for large investors and it also seems that there are many and of very varied origin. With all my respect…. I do not like.

In this turbulent and changing world, when there is so much talk about sustainability, it seems that the only concern is for the sustainable management of natural and animal resources, when, in my opinion, it is also necessary to be humanly and socially sustainable. We should keep the farmer as the most sustainable, the most perennial, the most faithful … and that essence is lost when prevails is short-term profitability.

Today I am here, tomorrow there, the day after…. We’ll see.

Let’s build something good, concentrating more, uniting more, giving more sustainability and wealth to our farmers. I am sure that Onubafruit is a good example of unity but we need more strength to be able to confront this uncertain future with guarantees. If not, we can fall into the clutches of individualism.