Certification as an upgrading strategy for small-scale farmers and their cooperatives : a value chain analysis for Nicaraguan coffee

For many small producers in developing countries coffee is a major income source. However, the coffee market is characterized by high price volatility and increased power concentration among buyers in consuming countries. Due to the very low international coffee prices during the recent coffee crisis and an increased demand among consumers for healthy and ethical products as well as for high quality, interest in standards and certification has increased substantially in coffee producing and consuming countries. Responding to the demand for differentiated products and accessing these new and potentially more profitable markets is especially challenging for poor small-scale farmers in developing countries. Although certification schemes and standards are widely applied and promoted, little research has been conducted identifying the complete value chains for certified coffee, their structure and gross income shares among the different chain actors. The framework for this study is based on the value chain concept. The research analyses selected conventional and Fairtrade value chains in terms of prices paid at different levels, information flows among chain actors, governance structures and upgrading strategies. The focus is on Nicaragua?s small-scale coffee producers, organised in cooperatives, and their upgrading strategies with special attention paid to organic and Fairtrade certification. Qualitative interviews have been conducted with all relevant chain actors. Results show that the structure of the value chain has a major influence on the benefits for individual farmers and their involvement in upgrading strategies. Although higher prices are paid to producers for organic-Fairtrade coffee than for conventional or conventional Fairtrade coffee, the producers? share on the final retail price is substantially lower in the certified chains than in the conventional chain. Producers face limited bargaining power on the quality premiums paid by buyers in consuming countries. The paper emphasizes the need for transparency and appropriate chain management to improve small-scale farmers? integration in value chain upgrading activities. An enhanced knowledge transfer among chain actors could increase farmers? understanding of differentiated markets and provide them with information on the coffee attributes sought by consumers. Being able to meet consumer expectations on attributes and quality standards could empower farmers with greater bargaining power and enable them to demand adequately higher prices. Simultaneously, business skills and management capacity need to be enhanced especially at the level of producers and leaders of grassroot cooperatives, but also at second order cooperatives? staff

Risk management networks of ethnic minorities in Viet Nam

The utilization of informal social networks is an important risk management strategy of vulnerable households in South-East Asia. To gain insight on this issue, a social network analysis (SNA) was implemented to assess risk management networks of ethnic minority farm households in the northern uplands of Viet Nam. The results from the analysis suggest that kinship relations and the level of wealth play an essential role in enabling basic network services to function. This paper also points out that effective networks require investments to fulfil the requested mutual obligations and that subsequently, social networks among poor farmers are relatively limited. The findings of the analysis show, not surprisingly, that networks cannot completely buffer severe shocks. Consequently, policy measures to reduce the costs of investing in social capital of poor farmers as well as improved access to appropriate social security systems are essential. These findings are applicable to other upland areas of South-East Asia.-

Linkages between poverty and sustainable agricultural and rural development in the uplands of Southeast Asia

Most of the upland areas of Southeast Asia are characterized by insufficient infrastructure, low productivity in smallholder crop and animal production, mounting environmental problems such as soil and forest degradation and loss of biodiversity, increasing population pressure, and widespread poverty, particular in rural areas. While some upland areas in South East Asia have been experiencing considerable progress during the past twenty years, others have stagnated or even declined with respect to economic, social and environmental objectives of development. The purpose of the paper is to describe major trends regarding sustainable development in the upland areas of selected countries in South East Asia, and review explanatory approaches for the observed trends based on case studies from Cambodia, Laos, Thailand, Vietnam, and Indonesia. The conceptual framework for this paper builds on the critical triangle of sustainable rural development. Here, equity or poverty alleviation, economic growth, and the protection of the environment are the three major policy objectives. We further distinguish three explanatory approaches for land use change and agricultural and rural development. Apart from the market approach and the population approach, we suggest that future studies should focus more on governance issues as a major driving force of land use change. The governance approach appears particularly relevant for upland areas which are often politically and institutionally marginalized. The paper begins with a review of definitions of sustainability, and proceeds with a conceptual analysis of the two-way linkages between poverty and the environment, and poverty and economic growth in rural areas. This is followed by empirical findings from research on agriculture and forestry as the major land uses in upland areas of selected South East Asian countries. Based on the results of different case studies from Cambodia, Laos, Vietnam and Indonesia, we seek to contrast stories of relative success with those of failure. The paper concludes with implications for rural and agricultural development policies, and suggests future areas of research

A rights-based food security principle for biomass sustainability standards and certification systems

With the shift from petroleum-based to biomass-based economies, global biomass demand and trade is growing. This trend could become a threat to food security. Though rising concerns about sustainability aspects have led to the development of voluntary certification standards to ensure that biomass is sustainably produced, food security aspects are hardly addressed as practical criteria and indicators lack. The research objective of this working paper is to identify how the Human Right to adequate Food (RtaF), which is applicable in over 100 countries, can be ensured in local biomass production and in certification systems in food insecure regions. We aim to first develop a suitable conceptual framework to integrate the RtaF in biomass production, processing and trade and derive guidance for the choice of the criteria. Second, we identify appropriate criteria to ensure that the RtaF is not violated by certified biomass operators based on a comprehensive literature review, stakeholder workshops and expert interviews with certification bodies, standard initiatives, NGOs, ministries, scientists and enterprises. The conceptual framework is based on the UN “Voluntary Guidelines to Support the Progressive Realization of the RtaF in the Context of National Food Security” and the four dimensions of food security. Based on this framework, we developed the rights-based food security principle. To ensure that the RtaF is not adversely affected by certified biomass production and trade, we propose 45 criteria, classified in 17 themes which are derived from the voluntary guidelines. The suggested criteria are applicable to all biomass types and uses and serve as a best-practice set to complement existing sustainability standards for biomass

Factores de adopción y abandono del sistema de agricultura de conservación en los valles altos de México

Under the conditions found in México, it is necessary to increase agricultural productivity with sustainable technologies such as farming systems based on the principles of conservation agriculture (CA). However, although the benefits of this technology have already been shown, until today it has rarely been tested and adopted by small and medium producers, and some have abandoned it during this process. Current studies are focused on analyzing factors for adoption, and they almost do not discuss the factors for abandonment. The objective of this study was to understand the adoption factors and, at the same time, determine the causes for abandoning the CA system in México. The research was based on semi-structured interviews, field observations and informal interviews with producers in México’s High Valleys. The results show that the adoption factors are, primarily, greater fertility and texture of the soil, and a reduction in production costs. The abandonment factors are related mainly with the lack of technical accompaniment and uncertainty regarding the use of the plot. Finally, the lack of appropriate machinery for CA, such as sowers, becomes a restriction for adoption of the system, but not the cause for abandonment. In order to facilitate the adoption of CA, it is advisable to include the local authorities in the process of technological innovation, to attain local support.En las condiciones de México, es necesario incrementar la productividad del agro con tecnologías sustentables, tales como los sistemas agrícolas basados en los principios de la agricultura de conservación (AC). Sin embargo, aunque ya se han demostrado los beneficios de esta tecnología, hasta hoy ha sido poco probada y adoptada por pequeños y medianos productores, y en ese proceso algunos la han abandonado. Las investigaciones actuales se enfocan a analizar los factores de adopción, y casi no discuten los factores de abandono. El objetivo de este estudio fue entender los factores de adopción y, al mismo tiempo, determinar las causas del abandono del sistema de AC en México. La investigación se basó en entrevistas semi-estructuradas, observaciones de campo y entrevistas informales a productores en los Valles Altos de México. Los resultados muestran que los factores de adopción son principalmente mejor fertilidad y textura del suelo, y reducción de costos de producción. Los factores de abandono están relacionados principalmente con la falta de acompañamiento técnico y la incertidumbre sobre el uso de la parcela. Finalmente, la falta de maquinaria apropiada para la AC, como son las sembradoras, se convierte en una limitante para la adopción del sistema, pero no es causa del abandono. Para facilitar la adopción de AC, es recomendable incluir a las autoridades locales en el proceso de la innovación tecnológica para tener un respaldo local

Can coffee cultivation lead to food security under a changing climate evidence from Western Honduras

Understand how coffee value chain actors address food insecurity of coffee households under climate stress

Certification as an upgrading strategy for small-scale farmers and their cooperatives : a value chain analysis for Nicaraguan coffee

For many small producers in developing countries coffee is a major income source. However, the coffee market is characterized by high price volatility and increased power concentration among buyers in consuming countries. Due to the very low international coffee prices during the recent coffee crisis and an increased demand among consumers for healthy and ethical products as well as for high quality, interest in standards and certification has increased substantially in coffee producing and consuming countries. Responding to the demand for differentiated products and accessing these new and potentially more profitable markets is especially challenging for poor small-scale farmers in developing countries. Although certification schemes and standards are widely applied and promoted, little research has been conducted identifying the complete value chains for certified coffee, their structure and gross income shares among the different chain actors. The framework for this study is based on the value chain concept. The research analyses selected conventional and Fairtrade value chains in terms of prices paid at different levels, information flows among chain actors, governance structures and upgrading strategies. The focus is on Nicaragua’s small-scale coffee producers, organised in cooperatives, and their upgrading strategies with special attention paid to organic and Fairtrade certification. Qualitative interviews have been conducted with all relevant chain actors. Results show that the structure of the value chain has a major influence on the benefits for individual farmers and their involvement in upgrading strategies. Although higher prices are paid to producers for organic-Fairtrade coffee than for conventional or conventional Fairtrade coffee, the producers’ share on the final retail price is substantially lower in the certified chains than in the conventional chain. Producers face limited bargaining power on the quality premiums paid by buyers in consuming countries. The paper emphasizes the need for transparency and appropriate chain management to improve small-scale farmers’ integration in value chain upgrading activities. An enhanced knowledge transfer among chain actors could increase farmers’ understanding of differentiated markets and provide them with information on the coffee attributes sought by consumers. Being able to meet consumer expectations on attributes and quality standards could empower farmers with greater bargaining power and enable them to demand adequately higher prices. Simultaneously, business skills and management capacity need to be enhanced especially at the level of producers and leaders of grassroot cooperatives, but also at second order cooperatives’ staff

Profits and poverty: Certification's troubled link for Nicaragua's organic and fairtrade coffee producers

Governments, donors and NGOs have promoted environmental and social certification schemes for coffee producers as certified market channels are assumed to offer higher prices and better incomes. Additionally, it is presumed that these certifications contribute to poverty reduction of smallholders. Yet, gross margins, profits and poverty levels of certified smallholder coffee producers have not yet been quantitatively analyzed applying random sampling techniques. Our quantitative household survey of 327 randomly selected members of conventional, organic and organic-fairtrade certified cooperatives in Nicaragua is complemented by over a hundred qualitative in-depth interviews. The results show that although farm-gate prices of certified coffees are higher than of conventional coffees, the profitability of certified coffee production and its subsequent effect on poverty levels is not clear-cut. Per capita net coffee incomes are insufficient to cover basic needs of all coffee producing households. Certified producers are more often found below the absolute poverty line than conventional producers. Over a period of ten years, our analysis shows that organic and organic-fairtrade farmers have become poorer relative to conventional producers. We conclude that coffee yield levels, profitability and efficiency need to be increased, because prices for certified coffee cannot compensate for low productivity, land or labor constraints.Fairtrade certification Gross margin Income Organic certification Profitability Poverty

Justified hopes or utopian thinking? The suitability of coffee certification schemes as a business model for small-scale producers

The marketing of coffee through group-based, certified market channels is often promoted by governments and donors as a viable business model for poor small-scale farmers. Organic and fairtrade coffees have become very popular among socially, environmentally and health conscious consumers in recent years. While coffee certification programs have been in place for over fifteen years, there are few studies on the welfare impacts of certification schemes. Therefore, this research seeks to analyse the impacts of certification on poverty alleviation and to identify the critical factors which explain success or failure of certification schemes. We use a combination of qualitative and quantitative research, comparing small-scale coffee producers in northern Nicaragua who are organized in conventional, organic, and organic-fairtrade certified cooperatives. Our results indicate that certification schemes have a low impact on poverty, including the aspect of food security. Reasons are seen in low yield levels, indebtedness, lack of entrepreneurial skills as well as cooperatives’ management capacities. We conclude that unfair trading conditions are not the main cause of poverty among smallholder coffee growers in Nicaragua. Thus, policies and projects need to address entrepreneurial skills of farmers and cooperative managers as well as amplify extension services

Linkages between poverty and sustainable agricultural and rural development in the uplands of Southeast Asia

Most of the upland areas of Southeast Asia are characterized by insufficient infrastructure, low productivity in smallholder crop and animal production, mounting environmental problems such as soil and forest degradation and loss of biodiversity, increasing population pressure, and widespread poverty, particular in rural areas. While some upland areas in South East Asia have been experiencing considerable progress during the past twenty years, others have stagnated or even declined with respect to economic, social and environmental objectives of development. The purpose of the paper is to describe major trends regarding sustainable development in the upland areas of selected countries in South East Asia, and review explanatory approaches for the observed trends based on case studies from Cambodia, Laos, Thailand, Vietnam, and Indonesia. The conceptual framework for this paper builds on the critical triangle of sustainable rural development. Here, equity or poverty alleviation, economic growth, and the protection of the environment are the three major policy objectives. We further distinguish three explanatory approaches for land use change and agricultural and rural development. Apart from the market approach and the population approach, we suggest that future studies should focus more on governance issues as a major driving force of land use change. The governance approach appears particularly relevant for upland areas which are often politically and institutionally marginalized. The paper begins with a review of definitions of sustainability, and proceeds with a conceptual analysis of the two-way linkages between poverty and the environment, and poverty and economic growth in rural areas. This is followed by empirical findings from research on agriculture and forestry as the major land uses in upland areas of selected South East Asian countries. Based on the results of different case studies from Cambodia, Laos, Vietnam and Indonesia, we seek to contrast stories of relative success with those of failure. The paper concludes with implications for rural and agricultural development policies, and suggests future areas of research