Smallholder compliance with private standard certification: the case of GlobalGAP adoption by mango producers in Peru
The prevalence of food quality standards in international trade is constantly increasing and has a growing influence on developing countries. A wide range of literature in development economics has focused on the debate of whether international standards exclude small-scale farmers from high-value food markets. In fact, the evidence is mixed. New debates arise on what conditions small farmers can really comply with, pointing out both threshold capital requirements, on the one hand, and industry structure and institutional environment, on the other hand. Drawing on a microeconomic approach, our paper is a contribution to the literature exploring the patterns and determinants of smallholders’ adoption of the food standard. We focus our case study on GlobalGAP adoption by small-scale fresh mango producers in Peru. Based on an analysis of primary data collected on the Peruvian mango sector, we show empirically that a few smallholders are engaged in GlobalGAP certification for a maximum of 3 years. They comply with the standard thanks to the support of exporting companies. Exporters offer the farmers contract farming, which includes technical advice and the annual certification cost. Nonetheless, farmers who are integrating into this high value-added supply chain seem to be selected on the basis of their proximity to the exporter plant (reducing transaction costs) and their ability to become reliable suppliers over the long term (experienced, specialized, and used to respecting contracts). These farms also must demonstrate their ability to deliver with short lead times (presence of mobile phone, distance to the plant). Finally, the paper underlines the key role of exporters in Peru as intermediaries and organizers in the way smallholders may participate in private standards in agrifood value chains.
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