Impact of certification on fruit producers in the Sao Francisco Valley in Brazil

Producers and exporters of fresh fruits and vegetables from developing countries like Brazil are increasingly required to demonstrate the safety and traceability of their produce up to the consumption stage. In fact, the Brazilian export market is still relatively underdeveloped, with an export share of only 2.4% of the total produced volume. However, certification may also have the effect of a non-tariff trade barrier, undermining the capability and financial ability of especially small-scale farmers in exporting to international markets. This study, therefore, aims at providing an economic analysis of certification on mango and grapes producers. A survey of 303 grapes and mango farmers was conducted in 2006 in the Juazeiro and Petrolina regions of the Sao Francisco Valley in Brazil. Certified and non-certified farmers as well as those in process to obtain certification were included in the sample. Empirical analysis using a logit model shows that grapes farmers have higher probability to certify than mango growers. There are two variables which have a positive and significant effect: education and experience. However, small-scale farms, the dependency on non-agricultural income and a trust-based arrangement have a negative but significant effect.