Agricultural products have peculiarities that go beyond their plant or animal origin.
These peculiarities distinguish them from other species of products and determine their production costs and sales prices.
The main ones include essentiality, seasonality, dependence on natural events, the incidence of commodities, degradation, and perishability, sanitary and environmental requirements, unique raw materials, and elongated production cycles, as commented below.
Essentiality
A large number of products of agricultural origin are essential to human subsistence, as they meet the needs of food, shelter, clothing, and energy.
Seasonality
Much of the production and supply of agricultural products is seasonal, as they depend on each species’ biological cycle.
Dependence on natural events
Agricultural products are highly dependent on natural events, whether climatic, geophysical, or biological.
Incidence of commodities
Another characteristic of agricultural products is that they are, on a large scale, commodities (a commodity is a marketable good, standardized, storable, usually of low added value, and traded in large quantities).
Degradation and perishability
Most products of plant and animal origin are highly degradable and perishable because they are composed of living raw materials.
Sanitary and environmental requirements
As they may present nonconformities or inadequacies that are harmful to human, animal, and plant health and the quality of the environment – deformities, infestations, contaminations, pathologies, deterioration, foreign elements or pollutants, and food additives harmful to health – agricultural products are controlled by strict standards physical, chemical, biological, visual and environmental.
Unique raw materials
As it happens with products of mineral origin, of which petroleum derivatives are the most emblematic case, many agricultural products derive from a single raw material. For example, it is possible to extract approximately 120 derivatives from sugar cane.
Elongated production cycles
Agricultural and cattle-raising activities often have uninterrupted production cycles longer than in other areas of activity.
That is the case for rice cultivation, which averages 130 days; broiler chicken production from incubated eggs, averaging 67 days; and eucalyptus cultivation for cellulose, averaging seven years.
C. L. Eckhard, author of Pricing in Agribusiness: setting and managing prices for better sales margins.