Agroindustrial project analysi

6 AGROINDUSTRIAL PROJECT ANALYSISfinished products for consumption. Second, agroindustries oftenconstitute the majority of a developing nation's manufacturing sector.Third, agroindustrial products are frequently the major exportsfrom a developing nation. Fourth, the food system provides thenation with nutrients critical to the well-being of an expandingpopulation. Each of these factors is examined below.A door for agricultureMost agricultural products, including subsistence products, areprocessed to some extent. A nation therefore cannot fully use itsagronomic resources without agroindustries. A survey of ricemillingpractices in six provinces in Thailand revealed that approximately95 percent of rice was processed in rice mills rather thanhand-milled in the home. 4 Similarly, a survey of 1,687 householdsin four regions in Guatemala revealed that 98 percent of familiestook their corn to mills for grinding and subsequently made thecorn dough into tortillas in the home. 5 Mechanical processing savesconsumer time and effort, and, as economies develop, these savingsbecome more important to consumers. Thus, the demand andnecessity for processing services increase as agricultural productionincreases.Agroindustries are not merely reactionary; they also generatenew demand backward to the farrn sector for more or differentagricultural output. A processing plant can open new crop opportunitiesto farmers and, by so doing, create additional farm revenue.In some instances this has permitted subsistence farmersto increase their income by entering the commercial market. Inother cases it has enabled new lands or lands unsuitable for traditionalcrops to be brought under cultivation. In regional developmentprograms, agroindustries have provided the economicjustification for rural infrastructure such as penetration roads thatprovide access to raw materials, electrical installations for plantoperation, or irrigation facilities. Agroindustries can also functionas an economic focal point for cooperatives for small farmers andrelated community-development activities.It is important to note that the process by which rural indus-4. James E. Austin (ed.), Global Malnutrition and Cereal Fortification (Cambridge,Mass.: Ballinger Publishing Co., 1979), p. 244.5. Ibid., p. 162.