Till the beginning of the 21 century, the food supply chain across the

Question

Till the beginning of the 21 century, the food supply chain across the globe was dominated by four huge firms: ADM, Bunge, Cargill, and Dreyfus, which are collectively known as the ABCDs – have more than hundred years of experience and therefore, have vast networks of ports, store houses, vehicles, and farmer relationships that make these firms the most crucial middlemen who are responsible for distributing food across the world. Almost every food item imported by any country at some point would go through the hands of one of the ABCDs. However, a new and budding firm CIL – the overseas branch of China’s government owned firm COFCO – is beginning to give the giant four a tough competition.

With more than 1.4 bn people to feed, China doesn’t have enough farming lands to cultivate food grains. Also, a booming middle-class population – as is the case in China – is accompanied by a sharp increase in demand for meat, worsening the situation as animal feed is typically made of grain. China has previously tried a different approach to tackling this problem – purchasing farmlands abroad. As a matter of fact, China was the largest foreign owner of  arable lands  in countries such as Australia. However, the Chinese government soon realized that utilizing farmlands abroad for agriculture is not a financially viable solution in the long run – especially when the host nations impose restrictions on foreign investments. Eventually, the government liked the idea of a stateowned supply chain firm that operates at a global level to procure food for the Chinese population, laying foundations for the CIL.

Even though the CIL has a strong hold on the food grain supply chain in over 50 countries, its initial days were riddled with hiccups – most of them stemming out of lack of experience. For instance, it acquired two major traders in South America, but lacked the vision to merge them, resulting in severe undercutting of price between the two and in losses for CIL as a whole. However, the CIL has soon learnt the tricks of the trade and is currently earning about $34 bn a year – a revenue just short of that of Dreyfus, one of the big four. With continuous growth in demand for food grains in China and the Chinese government’s vision for growth, the CIL is very much on its way to monopolizing the food supply routes across the world.    1 
 1. What is the main point of the passage?

A. To elaborate why the CIL was established and how it grew to its current stage
B. To point out that there is a huge scope for food supply chain industry to grow in the modern world
C. To highlight the increasing demand for food grains in China
D. To prove how the big four firms – ABCDs – no longer have an iron hold on the food supply chain industry
E. To point out the mistakes that a food supply chain firm needs to avoid in its budding stages

2 
 2. Based on the information in the passage, which of the following meanings can be inferred for the word "arable land" ( Highlighted )?

A. Land conducive to farming
B. Australian land
C. Rented land
D. Grazing land for animals
E. Land for research and development

3 
 3. Which of the following instances has been quoted in the passage to highlight a mistake committed by CIL?

A. Utilizing farmlands abroad for agriculture
B. Not merging the acquired traders
C. Venturing into the food supply chain industry
D. Being a state-owned supply chain }rm
E. Not gaining enough experience before competing with ABCDs

RC Butler 2022  -  Practice Two RC Passages Everyday.   
Passage # 143 Date: 08-Apr-2022
 This question is a part of RC Butler 2022 .  Click here for Details

Radhika2001 · Answer

Explanation of question 3

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Sajjad1994 · Answer

Official Explanation

3. Which of the following instances has been quoted in the passage to highlight a mistake committed by CIL?

Difficulty Level:   500

Explanation

(A) Out of Scope:  This was not the CIL’s action

(B)  Correct!

(C) Out of Scope:  This is not a mistake. The passage doesn’t indicate anywhere that CIL shouldn’t have entered the supply chain industry.

(D) Out of Scope:  This is not a mistake.

(E) Out of Scope:  It is the reason behind the mistake, not a mistake.

Answer: B

banker08 · Answer

For question 1, where in the passage is it mentioned about the reason why CIL was established?

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Sajjad1994 · Answer

Explicitly mentioned in the last of the second paragraph:

"Eventually, the government liked the idea of a state-owned supply chain firm that operates at a global level to procure food for the Chinese population, laying foundations for the CIL."

VerbalBot · Answer

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Till the beginning of the 21 century, the food supply chain across the

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Till the beginning of the 21 century, the food supply chain across the

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