Gustavo Grobocopatel used to be know as “Argentinean King of the Soybean”. The business of this farmer born at Carlos Casares, a little town in the heart of the Las Pampas, had an fast and incredible growing during middle ’90s and during the first decade of the new century.
“Los Grobo”, the name that popularized the company, developed a business model based in renting the land, running the crops, supply inputs to farmers, and storage and commercialize the grain (own and from third-parties). In his golden years he expand his agribusiness model to Brazil, bought wheat milling in both countries, and invested in the poultry business.
Now, most of those milestones are things of the past. Currently, Grobocopatel only own 25% of Grupo Los Grobo stocks, while major shareholders are investment funds, like Victoria Capital Partners. Farm operation remaind circunscribed to Argentina; some warehouses were sold as they did with three wheat milling and a pasta factory. Gross input rounds $700 million, but the company continue facing large debt stock they need reprograming it.
During the interview with www.eFarmNewsAr.com, Mr. Grobocopatel shows a clear and pragmatical logic: “Argentina grains output will reach 160 million tons, shortly. This grow implies a large opportunity for us, because we are focused on supplying services to the farmers”, affirm the interviewed.

-What are Los Grobo, currently?
-It’s a company that provides farmers risk management. Formerly, when we rented the farms, we took all the risk. Now we are sharing the risk with farmers through a percent scheme, where we provide agronomic management, inputs, labours by own or via contractors, and marketing. In some way we want to reduce farmers’ risk exposure.

-It been always said that Argentinean is the global most competitive farmer. Do you share this assumption?
-We lost some part of this competitiviness. We (the farmers) are living from innovations and developments from 20 years ago. We are not generating the innovations for the next ten or twenty years. We distrated in domestic fights and we forgot to preserve our farming advantages. We need to return to a innovation schedule.

-What are this disruptive technology?
-I’m talking about robotic, artificial intelligence, biotechnology, microorganisms, precision agriculture, etc. I’m talking about a robot that seeds and a robot that learn on its own seeds. I was in California, Israel, the MIT, and I could say that are investors paying attention to those innovations.

Photo: Mr. Grobocopatel and www.eFarmNewsAr.com editor-in-chief Javier Preciado Patiño, during the interview

-Do you think foreing investors finally will arrive at Argentinean farming?
-Local farming is admired allover the world. But it need that macroeconomics indicators will stabilized. The inflation, the fiscal and trading deficits or currency turbulences, concerns the investors. But we need local and foreing investment in the farming sector.

-Where investments will arrive?
-In the processing of raw materials, like dairy, poultry or beef industries. For example, if Argentina achieve an Free Trade Agreement with European Union, will be the Europeans who will invest in our animal protein industries. Also China could be a large investor. In fact they bought Nidera via Cofco and they expanded local operation until be the largest grain exporter. Furthermore, I’m seeing changes in dairy industry map as Arcor enter in the La Serenisima operation and Adecoagro could run the SanCor operation.

-Is the land in Argentina an atractive asset to investement?
-Really, I’m not a guy who like to buy land. I don’t like to inmobilize capital. I prefer the flow of the money. But, answering your question, price of the land is in relationship with cash flow it generates. Also, land is a refuge to capital. Some people have this point of view.

-But, what about land prices in Argentina?
-At the beginning of the century, prices rose dramatically. Lands in Argentina had the same value that in United States. But after 2008 crisis, prices began to slow down, and currently Brazil lands are more expensive than our. Anyway, there is and absurd law in Argentina that limit to foreigns acquire more than 1,000 hectares. I hope representatives modify this law.

-Do you think that beef chain is a good place to invest?
-Of course. Argentina does a difference in this area. We have good weather condition -in fact no snow in the Pampas- high qualified human resources and a trademark well recognized at global scale. Beef meat will be a speciality in the future and Argentina is in a privilege position.

-Los Grobo controls chemical Agrofina. What do you think about Argentinean input market?
-Here there is a large market, maybe 2.8 billion dollars and the market is expanding. From Agrofina we supply generic chemicals but no commodities, something like “specialties generics”. But a key assest we have is the access to the farmer, the capilarity of our network that permit us provides services to them. We have an effective strategy to marketing our products.

-Finally, wich is your message to the global agribusiness network?
-There is no many places in the world to attract investments in farming. Argentina is one of them and we (Los Grobo Group) have an efficient platform to generate profitability to our shareholders. We plan double the company size in the next four years, doubling gross incomes, the grain commercialized. We considerer ourselves as an ecosistem around the farmer and that is our strenght.