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Abstract
Food system dynamics worldwide are under a new paradigm. Energy supply based on renewable
natural resources is now a necessary solution, where agri-business can play an important role,
and food systems will have to interact worldwide with new competitors for land and
agriculture activity. The argument in this paper is based on the evidence that innovation and
technology changes in food production (agricultural production) can offer a sustainable supply
of grain and biomass, when demand behaviour is consistent and very flexible (demand elasticity
above 1).
The main argument is based on the hypothesis that demand behaviour is the main driver in food
systems, which can be observed looking at technical and technological changes in production
systems in Europe and elsewhere, such as Latin America, and more specifically Brazil. Economic
surplus distribution across the food chain is another key factor for the induced innovation
process to occur dynamically in food and agricultural production, based on well functioning
markets such as the international markets (elastic demand for most countries). Science will face
a new industry demand for solutions on the production side that are able to provide sustainability
and supply increases that have to support empowerment of the primary sector to help producers
capture surplus created by new technology possibilities, and “new demands”.
Technological changes will occur quickly enough to avoid strong changes in prices if, and only
if, producers are able to look at new opportunities with conditions (and sufficient time) to improve
their business (and share on economic surplus).
Institutional innovation is another key factor in the food system, and should also provide capability
to create value to a set of intangible goods provided by the primary sector, giving space
for a multi-functionality perspective on the primary sector activity, such as environment and
sustainability considerations. The first factor to be considered is certainly the market
functioning, because food production traditionally suffers from market problems, which began
with the characteristics of the products, space diversity, conservation problems, and production
seasonality (to mention only the most obvious). Other considerations related with the environment,
and non tangible goods, such as the landscape dimension (and other dimensions on man’s
relationship with nature), will continue to deserve new initiatives to improve the Quality of Life.