Agroindustrialization and agricultural commercialization are both consequences of economic growth and urbanization. Commercialization of agricultural systems leads to greater market orientation; progressive substitution out of non-traded inputs for purchased inputs; and the decline of integrated farming systems. Agricultural commercialization can have both negative and positive impacts on the natural resource base. Higher opportunity cost of labor increases farmer reliance on herbicides for weed control, primarily for the staple crops. The use of insecticides and fungicides could also rise, especially for high value fruit and vegetable crops. Increased use of agricultural chemicals could lead to higher environmental and human health risks. On the other hand, global integration and the consequent rationalization of agricultural policies could have significant environmental benefits, especially in terms of a reduced rate of salinity build up and ground water depletion in irrigated environments. The extent to which positive environmental effects manifest themselves depends on both macroeconomic and microeconomic policy reforms.