Determination of Value-Creating Activities in the Agricultural Value Chain

Abstract

A value chain starts with the production of a primary commodity, ends with the consumption of the final product. The aim of this study was to explain the agricultural value chain and to determine of value-creating activities in the agriculture sector. The literature review approach was utilized in the research. The agricultural value chain has seven stages which are input supply, production, producer organizations, traders, processors, wholesalers, and retailers respectively. In the value chain, it is aimed to get advantages against competitors by increasing the quality of crops and products, product differentiation or increasing the efficiency of the system. While the production costs of agricultural crops and products were affected by the input use and technology, product differentiation could be realized by the approaches of organic agriculture and good agricultural practices, etc. Although large enterprises in the agricultural sector could handle the value chain as a whole, small and medium-sized enterprises which had to leave the process early should focus on creating value as long as they remain in the process. With value chain analysis approach, it would be possible to contribute to the solution of certain main problems in the agricultural sector.