The Impact of Socio-Economic Characteristics on Coffee Farmers’ Marketing Channel Choice: Evidence from Villa Rica, Peru

Villa Rica is one of the most important coffee-producing districts in Peru. In Villa Rica there are several marketing channels: intermediaries, private companies, cooperatives and associations. The intermediaries focus solely on higher prices while marketing organizations offer benefits to their members. The main aim of this paper is to analyze the socio-economic characteristics that influence coffee farmers to join a formal organization vs. those who distribute their product through intermediaries. A survey of 60 producers was carried out in June 2011 in Villa Rica. A binary logistic model was used in order to show how these characteristics affect farmers’ choice of which marketing channel to use to distribute their product. The results demonstrated that farmers who are keen to receive technical assistance participate in the marketing organizations. These coffee marketing organizations should look for ways to improve the extension component through training and knowledge transfers to smallholder farmers.