Assessment of the financial needs of arabica coffee farmer-members in shifting from conventional to organic farming in Atok, Benguet

Date

6-2016

Degree

Bachelor of Science in Agricultural Economics

College

College of Economics and Management (CEM)

Adviser/Committee Chair

Alessandro A. Manilay

Abstract

The study was conducted to assess the financial needs of Arabica coffee farmer-members in shifting from conventional to organic farming in Atok, Benguet. Forty-two farmer respondents from the barangays of Caliking and Abiang were interviewed for this study. Cost and returns data and actual expenses in obtaining an organic product certification were also obtained from coffee farmer from La Trinidad Benguet, who was accredited in 2008. Additional information was gathered from employees of the regional office of the Department of Agriculture. Secondary data, on the other hand, were obtained from the Department of Agriculture, statistical websites, and the website of the Organic Certification Center of the Philippines. Descriptive analysis, multiple regression, cash flow analysis, and partial budget analysis were employed as statistical tools. Results showed that farmers perceive three benefits kin shifting to organic farming: access to a larger market, the possibility of earning a higher income from coffee farming, and reduction in input cost. The four top constraints perceived by the farmers were: the long and complicated process of applying for an organic farming, and the lack of perceived benefits. Farmers will also have to invest in a tool shed and pay for certification fees and organic fertilizer. The cash flow analysis revealed that the farmers will have a negative net cash flow on the fourth, fifth and sixth year after the transition stage. This is due mainly to the large fees that have to be paid for the organic certification. The partial budget analysis showed that the profit of the coffee farmers will be negative PhP 57, 629.00 during the transition stage of four years. This implies that farmers will encounter large financial losses during transition, and will need to identify possible sources of capital. However an, increase in the farm?s income was projected during the years after the transition stage because of the increase in coffee production and selling price of organic coffee. Lastly, the two factors that had significant effect on the amount of credit needed by the farmers are the number of years as a farmer, and the age. Based on these findings, this study recommended that 1) Arabica coffee farmers in Benguet be informed of the costs of shifting to organic farming. 2) inform farmers where to source out capital and funding, 3) encourage farmers to established other sources of livelihood 4) conduct information dissemination activities on how to obtain organic certification for Arabica coffee farms, 5) establish additional credit sources in the local area, and 6) further researches be done regarding Arabica coffee in Benguet.

Language

English

Location

UPLB College of Economics and Management (CEM)

Call Number

LG 993.5 2016 A14 O37

Document Type

Thesis

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