Abstract. Introduction. Avocados in Mexico

Transcription

1 ADOPTION OF CERTIFIED ORGANIC PRODUCTION: EVIDENCE FROM MEXICO Carolne E. Hattam and Garth J. Holloway Department of Agrcultural and Food Economcs, Unversty of Readng, PO Box 237, Readng, RG6 6AR, UK. Tel: +44 (0) e-mal: Key Words: Organc agrculture, adopton, market access, polcy nterventon. Abstract Adopton of organc producton and subsequent entry nto the organc market s examned usng Mexcan avocado producers as a case study. Probt analyss of a sample of 183 small-scale (<15ha) producers from Mchoacán suggests that adopton s postvely nfluenced by management and economc factors (e.g. producton costs per hectare and makng nputs), but also by socal factors (e.g. membershp of a producers assocaton). Experence n agrculture has a sgnfcant but negatve effect. Effectve polcy desgn must be therefore be aware of both the economc and socal complextes surroundng adopton decsons. Introducton Adopton of organc agrculture and organc certfcaton allow farmers to obtan access to the fastest growng sector of the nternatonal food market and obtan a premum for ther produce (FAO, 2002). However, the organc market has hgh entry costs. The decson to adopt requres sgnfcant changes and, although reversble, has long-term mplcatons. Nevertheless, the organc market s promoted by NGOs, donor organzatons and ncreasngly governments as an opportunty for producers n less developed countres to mprove ther ncomes (FAO, 2002; Parrot and Marsden, 2002). What remans unclear s the extent to whch ths dynamc market can be exploted by producers n the less developed regons and especally by the small-scale, rural poor (Harrs et al., 2001). To ensure that the rural poor do beneft from ths opportunty, there needs to be understandng of the multfarous aspects (socal, economc, techncal and nsttutonal) that mpact the adopton decson. The search for ths understandng s the subject of ths exercse. Usng small-scale (<15ha) avocado producers n Mchoacán, Mexco, we explore the factors determnng the adopton of organc producton wth a vew to determnng the types of nterventons that are lkely to encourage converson. In what follows, we brefly detal the nature of avocado producton n Mexco; descrbe the survey and data used n the probt nvestgaton; outlne the methodology used to mplement the model; present the results and close wth a dscusson and conclusons. Extensons are dscussed. Avocados n Mexco Mexco s the world s largest producer of avocados, almost 90 percent of whch come from one state: Mchoacán. At the end of 2004, the avocado zone of Mchoacán covered ha, producng tonnes of frut and nvolvng over 6000 producers (SIAP 2004), yet only 8-10 percent of ths s exported (Torres pers. comm.). The vast majorty of producers are small-scale wth low yelds, poor qualty frut and sell almost exclusvely to the natonal market (Stanford, 1998). Organc avocado producton began n the 1980s as a response to fallng prces and ncreasng costs, but at ths tme there was no recognsed organc market for the produce. The frst commercal efforts began n 1997, concdng wth the openng of the US market to Mexcan avocados. Adopton, however, has been slow and today only approxmately 100 producers and 1265 ha are certfed as organc. Of these 100 producers, about half are small-scale organc producers, although some of these also have large scale conventonal operatons.

2 The survey data Data collecton was completed n two stages. Intally, n early 2004, 32 sem-structured ntervews were conducted wth key economc actors, ncludng organc and conventonal avocado growers, members of avocado producers assocatons, buyers and packers of avocado, organc certfcaton agences, researchers and government offcals. Ths was followed by an n depth household survey of 233 smallscale avocado producers, 186 conventonal (non-adopters) and 47 certfed organc (adopters). The survey collected nformaton on household demographcs, atttudes to organc producton, avocado producton and yelds, assets and access to credt and nformaton. The defnton of organc s mportant. Here, organc producers are those who are fully certfed as organc and sellng on the organc market, and producers who are n the so-called transton perod, the perod n whch an adopter has commtted to enter the organc market, but has yet to receve full certfcaton. Modellng the decson to adopt organc producton Brefly, the economc model underlyng the emprcal nvestgaton presupposes expected utlty maxmsaton and the notaton E ( Uj ) where EU ( ) denotes expected utlty, ( = 1, 2,..., N) denotes an ndvdual n the sample and j ( = 1, f the agent adopts, = 0, otherwse) denotes acton. Usng ths notaton, ndvdual adopts organc producton f the expected utlty from adopton exceeds the expected utlty from non-adopton, or, n other words, f E U E U. Ths s a standard nterpretaton of the U 0 ( ) ( ) 1 0 bnary responses n a structured survey (Feder et al., 1985) and a standard set of technques s avalable for nvestgatng the factors that nfluence the adopton decson (Greene, 2003). The probt model s mplemented by defnng y = U as the unobserved (latent) dfference n expected utltes, 1 assumng that the respectve actons depend on observed covarates ( ) x = x, x,..., x ' and random 1 2 error, ε, and by assumng, n turn, that the random error s normally dstrbuted. Accordngly, wth β = ( β 1, β 2,..., βk )' a set of correspondng (unknown) adopton coeffcents, y = x' β + ε models the adopton decson and we observe y = 1 f 0 and observe y = 0, otherwse. Estmates of the y locaton and scales of the unknown coeffcents are retreved usng a standard procedure (Albert and Chb, 1993) and ndcate the drecton n whch the explanatory varables nfluence the adopton decson, ther relatve mportance and ther statstcal sgnfcance. Results and dscusson Due to mssng data, the model was run on a reduced data set of 147 conventonal producers and 36 organc producers, representng 77 percent of small-scale organc producers n Mchoacán. The results of the probt analyss are summarsed n Table 1. Four of the selected varables have a sgnfcant mpact on the decson to adopt organc agrculture. The other varables ncluded n the model, whle beng sgnfcantly dfferent between groups, are not sgnfcant, however they can be used to complement the model output (Har et al., 1998). The result that makng nputs and, to a lesser extent, exportng frut and regsterng costs postvely nfluence the decson to adopt organc producton s as expected, but could be construed as a consequence of beng an organc producer. The only market for organc frut where t obtans a premum s the export market; regsterng costs and transparent admnstraton are necesstes for obtanng organc certfcaton, and makng nputs forms part of the organc deology of closng the agrcultural system. However, havng experence of such actvtes wll make the transton to organc producton and enterng the organc K

3 market a much easer venture. Learnng and experence are mportant factors n the adopton process (Feder and Slade, 1984; Lndner et al., 1979). Table 1. Bnomal probt results for the adopton of organc agrculture β Varables ( x ) 1 estmates Hghest posteror densty nterval (95%) Experence n agrculture (years) Orchard sze (ha) Export frut (1=yes, 0=no) Number of full tme contracted labourers (not famly) Regster costs (1=yes, 0=no) Regster harvest volume (1=yes, 0=no) Management plan (1=yes, 0=no) Other crops (1=yes, 0=no) Other sources of ncome (non farm) (1=yes, 0=no) Informaton source other than agronomst (1=yes, 0=no) Membershp of assocaton (1=yes, 0=no) Age (scaled by 10) Educaton Most educated famly member Total costs/ha (nputs, admnstraton, rental of farm machnery) (n thousands of pesos) Make own nputs (1=yes, 0=no) Varables n bold ndcate sgnfcant β estmates (calculated wth a Gbbs sampler run for teratons) confrmed by the hghest posteror densty ntervals not crossng zero. The sgn of the β estmates ndcate the drecton of the mpact of the varable. The nsgnfcance of age suggests that organc producton s sutable for all, but at the same tme, producers wth more experence n agrcultural work are less lkely to adopt. Ths fndng agrees wth the lterature that organc producers are newer entrants to farmng (Padel, 2001; Burton, 1999). The lterature also states that smaller land holdngs are the norm among organc producers (Padel, 2001), contrary to manstream adopton theory (Feder et al., 1985). Nevertheless, the data presented here show orchard sze to be unmportant to the adopton decson, ndcatng that any orchard sze wthn the class of small-scale producer s feasble for converson. In contrast to adopton and dffuson theory (e.g. Rogers, 1983) and prevous research nto the adopton of organc producton (e.g. Burton et al., 2003; de Souza et al., 1999), educaton s shown to have a negatve and nsgnfcant nfluence on the adopton decson. Ths s n fact an encouragng result, especally for Mchoacán, where 59.9% of the populaton has only prmary educaton or less (INEGI, 2001) and for less developed countres as a whole, suggestng those wth lmted schoolng may convert wth success. Havng educated famly members s also not sgnfcant to the adopton decson. Costs per hectare have a postve sgnfcant effect on the decson to adopt organc producton, mplyng hgher costs for organc producers. As Table 1 shows, alternatve sources of ncome have a postve nfluence (although nsgnfcant), whch may be partcularly mportant n provdng extra ncome to ad adopton. Lkewse cultvatng other crops postvely nfluences the decson. Ths could be nterpreted as makng optmal use of space wthn the orchard, but n actual fact, the other crop s usually a commercal one, such as peaches, grown conventonally on another plot of land, agan suggestng the mportance of addtonal ncome. Furthermore, beng an organc producer and growng other crops ndcates a greater demand for labour (Lampkn and Padel, 1994), but the results show that the number of full-tme contracted employees s nsgnfcant to the adopton process. Ths may mean that organc farmers rely more heavly on famly labour, but more probably reflects some rsk or uncertanty n the labour market.

4 Membershp of a producers assocaton ncreases the lkelhood of converson to organc producton, aded by obtanng management nformaton from more dverse sources. Ths concdes wth other studes (Rgby et al. 2001, Burton et al. 2003) whch suggest that normal channels of nformaton flow (va agronomsts) are not sutable for organc producers. However, other sources are avalable and assocatng wth other producers may mprove ther flow. Avocado producers assocatons are also concerned wth frut sales and bulk purchasng of nputs. These roles are crtcal for the small-scale organc producer whose ndvdual producton may not be suffcent to supply demand, but also because of the relatve scarcty and cost of locally avalable ready to apply organc nputs. Conclusons If organc producton s to be promoted, then understandng the key factors affectng the adopton decson s paramount to desgnng projects and polces. Usng probt analyss, ths work demonstrates that nterventons should focus on the socal captal of producers, strengthenng producers assocatons and networks for nformaton flow, and ncreasng the avalablty of more dverse nformaton sources. However, ntroducng organc producton nto manstream nformaton channels (.e. tranng agronomsts n organc producton) can also be expected to be benefcal. Fortfyng producers management, plannng and accountng sklls should also ncrease adopton by encouragng a more commercal outlook to avocado producton, especally export orentaton. Promotng the elaboraton of homemade nputs wll also postvely nfluence adopton, whle at the same tme help to reduce the costs of organc producton. These results clearly demonstrate the smultaneous need to deal wth both the socal and economc factors affectng adopton f small scale producers n developng countres are to reach the certfed organc market. The fndngs presented here wll be extended n two ways. Frst, we wll assess the relatve contrbutons of each of the sgnfcant varables to the adopton decson by computng margnal probabltes of entry (Greene, 2003), and second, we wll evaluate the posteror odds of a model that ncludes only economc factors aganst one that ncludes only socal factors and the one above, whch consders that both economc and socal factors are sgnfcant n the adopton decson. References Albert, J. & Chb, S. (1993). Bayesan Analyss of Bnary and Polychotomous Response Data. Journal of the Amercan Statstcal Assocaton 88(422), Burton, M., Rgby, D. & Young, T. (1999). Analyss of the determnants of adopton of organc hortcultural technques n the UK. Journal of Agrcultural Economcs 50(1), Burton, M., Rgby, D. & Young, T. (2003). Modellng the adopton of organc hortcultural technology n the UK usng duraton analyss. Australan Journal of Agrcultural and Resource Economcs 47(1): de Souza Flho, H. M., Young, T. & Burton, M. P. (1999). Factors nfluencng the adopton of sustanable agrculture technologes: evdence from the state of Espírto Santo, Brazl. Techncal Forecastng and Socal Change 60, FAO (2002). Organc Agrculture, Envronment and Food Securty. Envronment and Natural Resources Seres No.4. FAO, Rome. Feder, G. & Slade, R. (1984). The acquston of nformaton and the adopton of new technology. AmercanJournal of Agrcultural Economcs 66, Feder, G., Just, R. E. & Zlberman, D. (1985). Adopton of agrcultural nnovatons n developng countres: a survey. Economc Development and Cultural Change 33, Greene, W. H. (2003). Econometrc Analyss. Pearson Educaton Internatonal Har, J. F., Anderson, R. E., Tatham, R. L. &Black, W. C. (1998). Multvarate Data Analyss. 5 th Edton, Prentce Hall Internatonal Inc., UK.

5 Harrs, P. J. C., Browne, A. W., Barrett, H. R. & Cadoret, K. (2001). Facltatng the ncluson of the resource-poor n organc producton and trade: Opportuntes and constrants posed by certfcaton. Techncal report. HDRA - the organc organsaton. For Rural Lvelhoods Department, Department for Internatonal Development. INEGI (2001). Tabulados Báscos. Estados Undos Mexcanos. XII Censo General de Poblacón y Vvenda, Aguascalentes, Ags., Méxco. Avalable at: e=16 Lampkn, N. & Padel, S. (1994). The economcs of organc agrculture: an nternatonal perspectve. CAB Internatonal, Wallngford, UK. Lndner, R., Fscher, A. & Pardey, P. (1979). The tme to adopton. Economc Letters 2, Padel, S. (2001). Converson to organc farmng: a typcal example of the dffuson of an nnovaton? Socologa Rurals 41, Parrot, N. & Marsden, T. (2002). The Real Green Revoluton: Organc and Agroecologcal Farmng n the South. Greenpeace Envronmental Trust, UK Rgby, D., Young, T. & Burton, M. (2001). The development of and prospects for organc farmng n the UK. Food Polcy 26(6), Rogers, E. M. (1983). Dffuson of Innovatons. Free Press, New York. SIAP (2004). Avance de Sembras y Cosechas: Perennes 2004: Aguacate. Avalable at Stanford, L. (1998). Mexco s Empresaro n Export Agrculture: Examnng the Avocado Industry n Mchoacán. Prepared for: AGR07: La Intermedacón en las Cadenas Internaconales de Mercancías Agrícolas at the 1998 meetng of the Latn Amercan Studes Assocaton, Chcago, Illnos, September Torres: Ingenero Salvador Torres Corona, Departamento Técnco, Asocacón Agrícola Local de Productores de Aguacate de Uruapan, Mchoacán, 17/02/04. Acknowledgements Ths work has been funded by an Economc and Socal Research Councl (ESRC) postgraduate studentshp and reports results from the frst author s doctoral research.