Land Cover in a Managed Forest Ecosystem: Mexican Shade Coffee

Managed forest ecosystems like shade coffee supply valuable ecological services. Yet little is known about the drivers and characteristics of clearing in such systems. We present a spatial econometric analysis of land cover in a shade coffee region in southern Mexico. We find that plots close to large cities are less likely to be cleared all other things being equal—the opposite of the pattern usually observed in natural forests. In addition, we find that membership in coffee-marketing cooperatives, farm size, and certain soil types are associated with tree cover, while proximity to small town centers is associated with clearing.     

The impact of coffee certification on small‐scale producers’ livelihoods: a case study from the Jimma Zone,Ethiopia

What is the impact of product certification on small‐scale farmers’ livelihoods? To what extent does the participation of Ethiopian small‐scale coffee farmers in certified local cooperative structures improve their socioeconomic situation? To answer these questions, this article employs household data of 249 coffee farmers from six different cooperatives collected in the Jimma zone of Southwestern Ethiopia in 2009. Findings show that the certification of coffee cooperatives has in total a low impact on small‐scale coffee producers’ livelihoods mainly due to (1) low productivity, (2) insignificant price premium, and (3) poor access to credit and information from the cooperative. Differences in production and organizational capacities between the local cooperatives are mirrored in the extent of the certification benefits for the smallholders. “Good” cooperatives have reaped the benefits of certification, whereas “bad” ones did not fare well. In this regard the “cooperative effect” overlies the “certification effect.”     

The effects of fair trade on coffee growers: a framework and analysis

The world coffee market has undergone a significant transformation in the past couple of decades resulting in declining farm prices despite the fact that coffee demand has been strong and consumer prices have been soaring. Fair Trade organizations have tried to address this price imbalance by providing an alternative method of trading aimed at increasing the prices received by coffee growers. Despite their noble objectives, Fair Trade movements have had limited success in improving coffee growers’ welfare, however. This paper utilizes a novel framework of heterogeneous producers and relevant market information to provide insights on the market and welfare impacts of the Fair Trade regime when important idiosyncrasies of Fair Trade production and marketing are included in the analysis.     

A discrete‐time hazard analysis of the exit of burley tobacco growers in Tennessee,North Carolina,and Virginia

This article examines the exit and survival dynamics of burley tobacco growers in Tennessee, North Carolina, and Virginia using a discrete‐time hazard logit model. The study also predicts the effects of selected farm and family characteristics on exit hazards, assesses the proportionality of their effects over time and their relative importance in explaining the variation in exit hazards among burley tobacco growers. Results provide the longitudinal progression of the probability of exiting the tobacco industry since the end of the federal tobacco program in 2004, and identify off‐farm participation, percentage of farm receipts from tobacco, tobacco price, educational level, and farm size as the most important determinants of the decision to exit the tobacco industry. Further, the effects of off‐farm participation and farm size on the exit hazards of burley tobacco farms are proportional over time while the effects of the percentage of farm receipts from tobacco and tobacco price are time variant.     

加入合作社对种粮大户农机投资及服务供给行为的影响分析

农业机械化水平是衡量现代农业发展程度的重要指标。以种粮大户、合作社等为代表的新型农业经营主体逐渐成为农机投资和提供农机服务的主力军。基于2018年江苏省686个种粮大户的微观调查数据,本文选用了多重跨栏模型并采用控制函数法实证检验了加入合作社对种粮大户农机投资与提供农机服务的影响。研究发现:相较于未加入合作社的种粮大户,加入合作社的种粮大户购买农机和提供农机作业服务的动机更强,户均农机作业服务供给水平更高。具体而言,加入合作社的种粮大户,其农机投资和提供农机作业服务的概率分别上升10.5和12.5个百分点,户均农机作业服务收益约增加3.382万元。由此,本文提出三点政策建议:一是引导种粮大户兼具生产性和服务性的双重功能,并鼓励合作社将种粮大户组织起来,共同开展农机服务。二是发挥合作社的组织优势,引导种粮大户投资相对短缺的农机装备。三是农机补贴向服务供给短缺的农机品种倾斜。     

Stuck in a rut: emerging cocoa cooperatives in Peru and the factors that influence their performance

Agri-cooperatives play an important role in helping resource-poor farmers reach high-value markets. In addition to linking smallholders to markets, cooperatives provide their members with various services, such as extension, credit, input subsidies, and social programmes. While the literature contains many examples of success, there has been limited discussion on the often long and turbulent process by which cooperatives develop over time and the viable options for shortcuts. This study examines four emerging cocoa cooperatives in Peru to determine their overall business viability, the key factors that advanced their development, and their capacity to address the needs of their members. Our findings suggest that strategies for supporting cooperative development have largely failed to address major internal weaknesses and the challenges posed in the external environment. The cooperatives have received time-bound, uncoordinated, and often small-scale, interventions, which have focused on infrastructure expansion and technical assistance. Important areas related to business management and governance structures, trust relationships with buyers, and sufficient working capital have largely been ignored. Shortcuts may be achieved through improvements in access to business development and financial services, deeper engagement by private sector to support the development process, and commitment by stakeholders to monitoring and critical reflection for strategy refinement.     

Cooperatives and the Commodity Political Agenda: A Political Economy Approach

Historically, major agricultural cooperatives in Canada have been intimately involved in commodity policy issues. Large cooperatives were created because farmers were upset about the perceived lack of competition in buying farm inputs or selling farm outputs. Often, the resulting cooperative was the organization farmers saw as the logical organization to represent their view of commodity policy or competition policy. As cooperatives grew and diversified, the ability to represent their members coherently across policy issues was hampered. For processing cooperatives in the supply-managed sector, the requirement that the cooperative be the political arm of industry, process product, and provide maximum returns to producer members made for a complicated objective function. This paper focuses on the twin objectives of providing efficient member services and performing political lobbying in a public choice framework. The results are illustrated by the recent history of a supply-managed further-processing cooperative and a diversified grain cooperative.     

A real options analysis of coffee planting in Vietnam

Vietnam grew from an insignificant to the world's second largest coffee producer during the 1990s. To understand this growth, this article examines Vietnamese coffee growers' investment decisions using real options theory. The study finds that producers, with variable costs of 19 cents/lb and total cost of 29.3 cents/lb, would enter coffee production at a coffee price of 47 cents/lb and exit at a coffee price of 14 cents/lb. Most Vietnamese growers appear to be sufficiently efficient to continue producing coffee even at relatively depressed price levels.     

Farmers' time allocation between farm work and off-farm work and the importance of unobserved group effects: evidence from Israeli cooperatives

Agricultural cooperatives differ in many attributes which affect members' farm and off-farm earnings in different ways. As a result, time allocation patterns between farm work and off-farm work will vary significantly across cooperatives. Participation equations in farm work and off-farm work of farmers who are members of Israeli moshavim are estimated jointly, including a cooperative-specific factor in each equation. The fixed effects are found to be significant and important, but can be only partly explained by observed cooperative attributes. This provides another support to the Monte Carlo results of Borjas and Sueyoshi, that controlling for group effects is superior to alternative models. The results also imply that unobserved factors have considerable effects on farmers' time allocation, and hence should be controlled for whenever possible.     

Impact of cooperatives on smallholders' commercialization behavior: evidence from Ethiopia

This article examines the impact of marketing cooperatives on smallholder commercialization of cereals using detailed household data in rural Ethiopia. We use the strong government role in promoting the establishment of cooperatives to justify the use of propensity score matching to compare households that are cooperative members to similar households in comparable areas without cooperatives. The analysis reveals that although cooperatives obtain higher prices for their members, they are not associated with a significant increase in the overall share of cereal production sold commercially by their members. However, these average results hide considerable heterogeneity across households. In particular, we find that smaller farmers tend to reduce their marketed output as a result of higher prices, whereas the opposite is true for larger farmers.     

Smallholder cooperatives and agricultural performance in Rwanda: do organizational differences matter?

Agricultural policies in Rwanda focus on agricultural intensification and increased market orientation of the smallholder farm sector. Cooperatives are seen as key vehicles in this, but little is known about their effectiveness to achieve these goals. In this article, we analyze the impact of cooperative membership on the agricultural performance of rural households in Rwanda. We use cross‐sectional survey data, collected in 2012, to analyze the impact of cooperative membership on different agricultural performance indicators, including indicators on agricultural intensification, market orientation, farm revenue, and income. We use several econometric techniques to deal with potential selection bias in estimating the impact of cooperative membership, including a proxy variable method based on a willingness to pay measure and propensity score matching methods. We find that cooperative membership in general has a positive impact on farm performance but these effects are driven by specific types of cooperatives.     

Big is efficient: Evidence from agricultural cooperatives in Ethiopia

In Ethiopia, there is a renewed interest in agricultural cooperatives as an institutional tool to improve the welfare of smallholder farmers. One of the pathways through which cooperatives benefit their members is scale economies. However, the establishment of cooperatives in Ethiopia seems to pay little attention to the size of the organizations. This article aims at investigating the effect of size on cost efficiency of agricultural cooperatives. More specifically, the purpose is to examine whether a single cooperative can serve a given number of farmers at a lower cost than two or more smaller cooperatives could. We employ the concept of cost subadditivity to compare the cost efficiency of large versus small cooperatives, and by extension unilateral actions. We estimate a flexible production technology using cross‐sectional cooperative‐level data. Findings show that costs would drop by 78% to 181% if farmers join hands in relatively large rather than small cooperatives.     

Testing vertical price transmission for Vietnam's Robusta coffee

Vietnam has undergone market reforms over the last three decades; and as a consequence, the coffee sector has become increasingly market‐driven. The success of the government's liberalisation policies in terms of market efficiency is investigated by examining the transmission of both positive and negative price changes for Robusta coffee between export and farmgate prices. We used a threshold vector error correction model and high‐frequency daily data. The primary result here is that of a symmetric price transmission between export and farm‐level prices. This result holds when tested with weekly price data, derived from the daily data. Farmgate prices respond faster to decreases than increases in export prices when the long‐run deviation exceeds a certain threshold. These price changes are transmitted within several days. This research also confirms the importance of transaction costs, and other price frictions mostly ignored in prior analyses for coffee.     

Price premiums,payment delays,and default risk: understanding developing country farmers’ decisions to market through a cooperative or a private trader

Smallholder farmers in developing countries face a competitive disadvantage in modern agricultural supply chains. Joint marketing through cooperatives is a potential tool to mitigate these disadvantages; yet cooperatives’ success in these settings is uneven at best. We develop an analytical model to study a farmer's choice of selling to a private trader who pays cash on delivery but may exercise market power or a cooperative that promises a price premium but delays payment and carries a concomitant risk of default. In the presence of impatient and risk‐averse farmers, we show that these factors can severely limit smallholder patronage of a cooperative, despite a promised price premium. We then construct and parameterize a simulation model to fit a profile of heterogeneous farmers within a prototype developing‐country village, and study the optimal decisions of farmers regarding marketing through a cooperative versus a private trader. Results suggest that modest improvements in either timeliness of payment or probability of default can induce a substantial increase in a cooperative's market share and economic viability. Extending the simulation analysis to a dynamic setting shows how implementing reasonable policies to improve a cooperative's payment timeliness and default probability can markedly improve its growth trajectory.     

Causality and Efficiency in the Coffee Futures Market

Tests for causality and rationality in the coffee futures market were carried out using data from the New York Market. Tests of causality indicated that futures prices strongly influence variations in spot price eight weeks or more to maturity. However, beginning seven weeks to maturity there seems to be a strong causal relationship going from futures to spot and from spot to futures. Risk constancy or neutrality, equality of risk premium and spot price, and efficiency were rejected for the period 18, 51, and 33 weeks or more to maturity. However, simultaneity of risk neutrality and efficiency was accepted for contracts with 55-77 weeks to maturity. The general conclusion from this study is that coffee futures market can be used as an indicator of spot market prices for contracts with 55-77 weeks to maturity. While benefits can be obtained through short term adjustment of available stock and making use of quality storage facilities, planning longer term planting and marketing decisions (e.g., ≥ 77 weeks) on the basis of futures market price can result in misallocation of resources and welfare loss.     

Market-Based Price-Risk Management: Welfare Gains for Coffee Producers from Efficient Allocation of Resources

The volatility of coffee prices exposes coffee producers to price risk. Price risk is one of many risks faced by commodity producers in developing countries. Coffee is widely traded in the international commodity derivative markets. This offers scope for coffee producers to manage their price risk by hedging on these markets. The hedging mechanism recommended is based on the use of coffee futures and options. The mechanism involves costs, so the benefits of hedging need to be evaluated in order to assess its usefulness for producers. It emerges that the main benefit lies in producers being able to allocate resources more efficiently in the production of coffee. An analysis of theoretical and field evidence shows that this benefit can potentially be quite high, especially for risk-averse producers. This underlines the need to provide producers with access to suitable price-risk hedging mechanisms.     

合作社嵌入对林农生态化经营非木质林产品的影响

以浙江省、江西省和福建省这3个省378户林农为样本,采用Logit模型分析合作社嵌入对林农生态化经营非木质林产品的影响。结果表明:合作社嵌入显著地促进林农生态化经营非木质林产品。此外,户主受教育年限、农户家庭林业收入所占比例、林种及家庭营林劳动力人数也在不同程度上促进林农生态化经营非木质林产品。因此,提出建立生态化经营试点示范;发挥核心社员的示范带动作用;开设针对性的生态化经营技术培训等建议。     

Private transaction costs of participation in water quality improvement programs for Australia's Great Barrier Reef: Extent,causes and policy implications

The direct private cost to landholders of participating in programs that result in improved farming activities (IFAs) is generally well understood. However, the private indirect or transaction costs, such as the cost of a landholder's time and the expense to learn about IFAs and apply for assistance to implement these changes on‐farm, are not so well understood. Where these have been studied, they have been shown to be extensive. We assess the extent and causes of private transaction costs incurred by sugarcane growers participating in the Australian Government's Reef Rescue scheme which pays farmers to adopt environmentally beneficial farm management practices. Utilising a mail‐out‐mail‐back survey of 110 growers, we found that the average total transaction cost per farm of participating in the program was AU$8389. The average total transaction costs per farm as a percentage of the average funding provided was 38 per cent. We also assessed which type of improved farming activity (soil, nutrient, pest or water management) generated the greatest transaction costs and how landholder characteristics such as bounded rationality, opportunism and social connection impacted on the extent of transaction costs.     

Institutional Environment and Technical Efficiency: A Stochastic Frontier Analysis of Cotton Producers in West Africa

This paper examines the effects of the institutional environment on West African cotton farmers’ technical efficiency (TE). First, key aspects of the cotton sector institutional environment are discussed, including input and credit access, and producers’ organisations. Then, a stochastic frontier production function, which incorporates technical inefficiency effects, is applied to farm level data collected in Benin, Burkina Faso and Mali. The survey includes farmers’ evaluations of the cotton sector institutional environment. Results suggest that institutional level features influence producers’ TE, besides farm‐level characteristics. Cotton growers who report a negative experience with the joint liability programme, who identify the cotton price mechanism or access to credit as the main constraints to performance, and who cultivate more hectares of cereals are technically more inefficient in producing cotton. Findings suggest that cotton farmers in Mali are less technically efficient in producing cotton than in Burkina Faso and Benin. Agricultural development policies focusing on reducing farmers’ financial stress, particularly through the establishment of adequate price mechanisms (i.e. higher farm‐gate prices and timely payments to farmers) and improvement in the input–credit markets should be encouraged to improve TE in West Africa.     

Do farmers benefit from participating in specialty markets and cooperatives? The case of coffee marketing in Costa Rica1

Historically low prices in the conventional coffee market have caused financial and social hardship among coffee farmers. In the face of this crisis, specialty markets have attracted the attention of the international donor community. These market segments have shown consistent growth over the last decade and exhibit price premiums in international markets. Therefore, if higher prices are passed on to farmers, access to specialty markets could help to alleviate the crisis brought on by low prices in the conventional sector. The present study attempts to identify the factors that determine farmers' participation in specialized markets and whether participation in these markets leads to higher prices for farmers. A two-stage model is used to analyze farmers' marketing decisions and their effect on the prices received. This procedure allows us to control for the endogeneity bias introduced by the marketing choice. Our results indicate that farmers participating in the specialty coffee segment do in fact receive higher prices than those participating in conventional channels. Additionally, we find that participation in cooperatives has a positive impact on the probability that a farmer chooses to grow specialty coffee and analogously on the prices that they receive. Based on these results, it seems that efforts to increase participation in the specialty coffee segment and in cooperatives would help to lessen some of the hardships brought on by low prices in the conventional coffee sector.