Competitive Strenghts
Competitive Strenghts
Adecoagro´s competitive advantages are:
- Unique and strategic asset base.
Adecoagro owns strategically located farmland and agro-industrial assets, increasing operating efficiencies and reducing operating and logistical costs. Owning a significant portion of the land on which the Company operates is a key element of its business model.
- Low-cost production leveraging agro-ecological competitive advantages.
Each of the commodity products Adecoagro grows is produced in regions where agro-ecological conditions provide competitive advantages and which, through the implementation of its efficient and sustainable production model, allow them to become one of the lowest cost producers.
- Standardized and scalable agribusiness model applying technological innovation.
Adecoagro has consistently used innovative production techniques to ensure that the Company is at the forefront of technological improvements and environmental sustainability standards in its industry.
- Unique diversification model to mitigate cash flow volatility.
Adecoagro pursues a unique multi-tier diversification strategy to reduce its exposure to production and market fluctuations that may impact its cash flow and operating results. They seek geographic diversification, thereby lowering their risk exposure to weather-related losses and contributing to stable cash flows. Additionally, Adecoagro produces a variety of products, which lowers the Company´s risk exposure to potentially depressed market conditions of any specific product.
- Expertise in acquiring farmland with transformation and appreciation potential.
Adecoagro believes to have a superior track record and is positioned as a key player in the land business in South America. adecoagro has developed a methodology to assess farmland and to appraise its potential value with a high degree of accuracy and efficiency by using information generated through sophisticated technology, including satellite images, rain and temperature records, soil analyses, and topography and drainage maps.
- Experienced management team, knowledgeable employees and strong shareholder base.
The people is Adecoagro´s most important asset. Adecoagro has an experienced senior management team with an average of more than 20 years of experience working in its sector and a solid track record of implementing and executing largescale growth projects.
South America’s Competitive Strengths and Favorable Dynamics for Agribusiness
South America contains one of the largest areas of available farmland world and is positioned to take advantage of growth opportunities to supply the demand for agricultural commodities and biofuel in the global market due in part to the following factors:
- Favorable agro-ecological conditions.
Favorable climatic and geographical conditions, highly productive soils, stable temperatures, adequate rainfall levels throughout the year, plentiful availability of water resources and abundant solar energy create some of the most optimal conditions for farming in the world, even allowing for the harvesting of two crops in the same year in some regions.
- High potential for production growth.
Farmland is available at attractive prices relative to other regions in the world, and Adecoagro believes that much of the vast areas of land available in the region are ripe for development and present opportunities for transformation and associated appreciation.
- Low production cost.
The ability to farm larger plots of land allows for economies of scale to effectively further reduce operating costs, leading to logistical efficiencies, and has allowed for the adoption and implementation of productive technology in farming and agricultural manufacturing processes.
- Qualified labor pool.
South America has access to a vast pool of qualified human resources with strong technical skills and academic backgrounds in the agricultural field.