VZCZCXYZ0004
RR RUEHWEB

DE RUEHBU #1824/01 2551851
ZNR UUUUU ZZH
R 121851Z SEP 07
FM AMEMBASSY BUENOS AIRES
TO RUEHC/SECSTATE WASHDC 9228
RUEHRC/USDA FAS WASHDC

UNCLAS BUENOS AIRES 001824 
 
SIPDIS 
 
STATE FOR ECON WHA/BSC 
USDA FOR FAS/OA/OSTA/OCRA/ONA/OGA/OTP/OCBD/OAO/OFSO 
 
SIPDIS 
 
SENSITIVE 
 
E.O. 12958:  N/A 
TAGS: EAGR AR
SUBJECT:  AMBASSADOR DISCUSSES INNOVATION IN ARGENTINE AGRICULTURAL 
SECTOR WITH INDUSTRY LEADERS 
 
 
¶1. (SBU) SUMMARY:  On September 10 Ambassador visited Los Grobo, one 
of Argentina's leading agricultural companies, and participated in a 
luncheon with several of the sector's leading producers to discuss 
business innovation and technology adoption in Argentine 
agriculture.  These Argentine companies in the agricultural sector 
have responded to frequent changes in government policy by 
developing creative new management structures that have greatly 
increased the efficiency of the sector. END SUMMARY. 
 
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LOS GROBO 
--------- 
 
¶2. (SBU) Ambassador visited the Argentine agricultural company Los 
Grobo in Carlos Casares, Buenos Aires Province, on September 10.  He 
was received by Los Grobo General Manager, Gustavo Grobocopatel, and 
members of the Grobocopatel family, who escorted him on a tour of 
the company headquarters.  Los Grobo is a diversified company that 
manages over 110,000 hectares of land in Argentina and 40,000 
hectares in Uruguay and Paraguay (as well as operations in Venezuela 
and Brazil).  The group's production is comprised mainly of soybeans 
and wheat, with the rest in corn and sunflower.  In addition to its 
roughly 400 employees, it works with many smaller supplier 
companies.  In 2007, the company has grown to become an 
international company with sales totaling more than US$300 million. 
 
------------------------------------- 
CORPORATE INNOVATION IN AGRICULTURE 
------------------------------------- 
 
¶3.  (SBU) Los Grobo directors explained that the domestic 
agricultural situation in Argentina, where producers often work 
under onerous government-imposed regulations, requires management 
innovation to remain solvent.  Los Grobo is at the forefront of 
Argentine entrepreneurship in the agricultural sector and has become 
a highly successful leader in the agrifood chain by diversifying 
itself, becoming not just a production company but a services 
company as well.  In addition to building partnerships to attain 
that goal, it is being accomplished by quick technology adoption - 
biotechnology, information technology, and agricultural 
technologies. 
 
--------------------------------------------- 
BREAKING THE LAND OWNERSHIP - PRODUCTION LINK 
--------------------------------------------- 
 
¶4. (SBU) Los Grobo explained that agriculture in Argentina has 
become an industry of specialization in services, and their strategy 
is to adapt to that situation.  Approximately 70 percent of 
agricultural production is currently produced on rented land in 
Argentina.  And more than 65 percent of the work is done with rented 
machinery.  This trend has created opportunities for small producers 
to specialize in services, such as planting, fertilizer or pesticide 
application, and harvesting.  Los Grobo has also adapted to this 
situation and now produces over 90 percent of its crops on rented 
land and is also involved in specialized services. 
 
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ESTABLISHING PARTNERSHIPS 
------------------------- 
 
¶5.  (SBU) Los Grobo directors recognize the need to establish 
partnerships.  One of the company's goals is to establish itself as 
"the best partner in the agrifood chain."  Monsanto is its strategic 
partner with respect to promoting the use of biotechnology.  In 
addition to commercial partnerships, Los Grobo has also established 
an educational partnership with Harvard University.  This 
partnership takes the form of educational exchanges and periodic 
educational videoconferences with Harvard University.  Los Grobo 
also hosts numerous interns and graduate students from several U.S. 
land grant universities. 
 
------------------- 
AMBASSADOR DISCUSSES AGRICULTURAL SECTOR WITH ENTREPRENEURS 
------------------- 
 
¶6.  (SBU) After touring the corporate office, Ambassador shared a 
luncheon with the Grobocopatel family and several leaders in the 
agricultural sector.  Topics of discussion included: current status 
of technical and educational collaboration between our two countries 
and the desire to enhance that cooperation; the rapid adoption of 
U.S. technology by the Argentine agricultural sector; support for 
collaboration on agricultural issues in international fora; and the 
differences between the agricultural production in Argentina and the 
United States. 
 
------------------------------- 
 
Corporate Social Responsibility (CSR) 
------------------------------- 
 
¶7. (SBU) Los Grobo presented a video explaining in detail their CSR 
Programs in which their main objective is to improve education in 
Argentina and provided a briefing by two leaders of its foundation. 
The company formalized its CSR programs under its "Rural 
Entrepreneurships Foundation" in 2004.  The Foundation has 
 
implemented several impressive programs including entrepreneurship 
education in rural towns to create businesses and jobs in rural 
areas.  In addition, they initiated a national reading day, in which 
more than 800,000 students participated last year.  In 2006, Los 
Grobo social programs directly benefited more than 4,000 people. 
 
WAYNE