The financialization of agribusiness in Brazil

Fiagros funds as financial innovations.

Abstract

Financialization is characterized by the increased influence of markets, actors and financial motivations on economies. The emergence of financial innovation is one of the main underpinnings of this phenomenon in the global economy. Agribusiness is of fundamental importance to the Brazilian economy. The objective of this study is to examine the financialization of agribusiness based on the emergence of Fiagros as financial innovations, highlighting the role of the state in this process of financialization of agribusiness in Brazil. Based on an exploratory and descriptive analysis of data, this study is supported by the strategic action field theory and the sociology of finance. The results highlight the significant growth that Fiagros have experienced in just a few years. The economic power of these institutional investors increases the dependence of agribusiness on the financial market, whose rent-financial interests are not necessarily aligned with the economic and social functions inherent to agribusiness in Brazil.