Governance Structures in Global Agro-Commodities Chains

Global linkages are as important as local networks for firms geographically located in regions with export oriented agro-commodity production. In these cases, regional economic growth is associated with enhancing competitive capabilities of those firms within global agro-commodity chains. The latter have internal governance structures with different patterns and dynamics that condition those upgrading possibilities. Based on groundnut trade between Argentinean and European firms within the European Shelled Groundnut Chain, this paper clearly illustrates this statement. The quasi-hierarchical governance structure of this chain allows Argentinean firms to implement only some basic types of upgrading strategies. Even after important changes at the end of the 1990s, the quasi-hierarchical structure remains and, hence, only process and product upgrading are achievable for actors, like Argentinean primary processors, locked into lower value stages within the chain.