Understanding firm networks in global agricultural value chains

Abstract

This paper explores the evolution and resilience of global value chains (GVCs) in the agrifood sector, which intensified since the 1994 Uruguay Round Agreement. Using unique data from the FactSet database, along with Fortune 500 lists, we conduct a comprehensive analysis of approximately 17,500 agribusiness companies worldwide, examining over 150,000 supplier and customer connections from 2014 to 2022. Our findings reveal that large corporations, acting as central nodes, have increased their network centrality in GVCs, particularly through geographic diversification and a concentrated supply strategy. The study also indicates a correlation between the complexity and depth of firm-to-firm linkages and increased resilience, suggesting that firms with greater connectivity are less likely to exit the industry. This analysis not only contributes new insights into the structure and dynamics of agribusiness networks but also highlights the role of firm linkages in navigating recent disruptive global events such as the US-China Trade War, COVID-19 pandemic, extreme weather episodes, and geopolitical tensions.