Connecting the supply and demand via labelling options for the sustainability of a food sector. The example of the yam sector in Guadeloupe

Nowadays, consumers are more and more concerned about the traceability of the food they purchase. As a response to this phenomenon, labels have flourished highlighting the environmental impact of products for some, their nutritive characteristics or their origin for others. In this context, we wonder about how food production sectors can meet the consumers' demand and about the role of labeling as a tool to foster the sustainable development of food sectors. We base our analysis on the case of the yam sector in Guadeloupe. Food sectors in the tropics face heavy constraints (Scott, Rosegrant et al. 2000; Charlery de la Masselière 2002). Yam is the first food crop in Guadeloupe both in area (450 ha) and production (6 300 t). It covers 78% of the needs of the territory (Agreste 2009; Chambre Agriculture 2010). Nevertheless, the decrease by half of its cultivated area during the last decade reveals that it is on the decline (Agreste 2009). During this period of time, the production and consumption of yam has been highly impacted by the discovery of a long-lasting pollution of soils by chlordecone, a pesticide that was previously used in banana fields. Today, by decree, farmers who want to grow yam in the contaminated perimeter have to get their production analyzed before selling it on the marketplace. Guadeloupian consumers are quite suspicious regarding the presence of pesticides in local food but still yam is still part of the diet of the population (Merlo, 2007). Given the above we wondered about consumers' perception of local yam if they could be reassured regarding the absence of pesticides in yam tubers. We also investigate the interest and implication of certification for yam farmers. Our work aims to shed light on how farmers and consumers can interact to design a sustainable food production sector. We look at both the supply and demand side and discuss about the ways to connect both views in a labeling scheme. According to the existing literature about farmers' decision making (Cerf and Sébillotte 1988; Duru, Papy et al. 1988; Sébillotte and Soler 1988; Bonneval 1993; Marshall, Bonneviale et al. 1994), we studied farmers' productive and commercial strategies regarding yam and accordingly built a typology of the different farming systems that exist in Guadeloupe. We then looked for each type at the costs and returns of growing yam - using the economic results simulation tool of yam crop: Ignamarge© - and examined the economic implications of certification. Our analysis revealed the existence of six types of yam producing farms for commercial purposes. For some types, yam appears to be the most important crop and is mostly sold in direct sale therefore procuring the highest returns to the farmers. For some others, it is only part a diversification crop among others and is traded via a farmers' cooperative or thanks to intermediaries. In those last schemes, the value is shared among the different actors along the food chain. Getting certified could match with some of the strategies developed by farmers but would imply them to change some of their production and commercial practices. Additionally certification would require the yam sector to increase its organizational capacity since farmers' strategies are rather individual at present. On the other hand we set up a laboratory experiment to investigate whether consumers were willing to pay a premium for two different types of labels since Levitt and List (2007) showed that laboratory behavior is a good indicator of behavior in the field. We based our experiment on the protocol developed by Lange et al. (2002) and adopted by Bougherara and Combris (2009). The experimental method makes it feasible to estimate consumers' valuation of specific characteristics by controlling precisely the information on products. Therefore it is possible to compare consumers' willingness-to-pay for a little variation in characteristics of otherwise identical products. This comparison allows appraising the substitution relation among two characteristics. To achieve this goal, we used the BDM procedure (Beker, De Groot, Marshak, 1964) to elicit the willingness-to-pay for locally produced yams (outside of the contaminated perimeter) and organically grown yams. Consumers were recruited according to a set of criteria such as their yam consumption habits, getting involved in food purchasing at home and not being regular participants of marketing studies. Then we estimated tobit models of the participants' willingness to pay, one for each profile. Results showed a significant change of the participants' WTP when yams were labeled (figure 1) and that they were ready to pay a premium for locally produced yam and organically grown yam. Considering the above we discuss the consequences of labeling for farmers and consumers and how the strategies of those different actors can coincide. Our work raises the question of the type of policy instruments that need to be implemented to ensure that certification schemes help food sectors to guaranty quality and achieve sustainability.