Comparative analysis of the production costs and profitability of the special coffee with certified organic and non-certified

Abstract

Organic certification, as well as cup quality, are factors of interest for the export and marketing of coffee. The aim of this study was to determine and compare the production costs and profitability of certified organic and non-certified specialty coffees among organized coffee growers in the northern coffee region of Peru. Twenty-four small farmers were interviewed in Peru’s Jaén province. These farmers were divided into two analysis groups: (i) Specialty coffee with organic certification (CECO); and (ii) Specialty coffee without certification (CESC). The data was analyzed using the Kruskal-Wallis non-parametric analysis method. The production cost of the CECO group was found to be significantly higher than that for the CESC group (p = 0.00045 and k = 12.313). Moreover, the CESC group was found to be the most profitable across all the profitability indicators analyzed, and the least sensitive to the fall in the sale price of specialty coffee. The study concluded that the high production costs and consequent low profitability of the CECO group is closely associated with fertilization costs. However, environmental sustainability requires technologies, technological services or other private or public sector strategies that will provide support for its viability over the medium and long term.