IDEAS home Printed from https://ideas.repec.org/a/ags/ifaamr/316354.html
   My bibliography  Save this article

Impact of buyers' support on farmer performance and investments in the Brazilian pork supply chain

Author

Listed:
  • Martins, Franco Müller
  • Trienekens, Jacques
  • Omta, Onno

Abstract

This paper analyses how the technical and managerial support of buyers affects the performance and investment capacity of Brazilian pig farmers. The paper also analyses the influence of the farmers’ investment capacity on their own performance and how that performance in turn influences the investment requirements demanded by buyers. We developed a structural equation model applied to a sample of 199 farmers including piglet farmers (n=91) and finishers (n=108) working under production contracts. The model includes two constructs that assess performance – financial performance and production and quality performance. The results show that buyer support positively influences both performance constructs and investment requirements for piglet farmers and finishers. The relationship between buyer support and investment capacity was significant only in the sample of finishers. Farmers’ investment capacity positively influences both performance constructs in the sample of piglet farmers. For finishers, investment capacity influences only financial performance. Moreover, only production and quality performance of finishers influences investment requirements. The results provide buyers and farmers with insights for refinements in support policies and management.

Suggested Citation

  • Martins, Franco Müller & Trienekens, Jacques & Omta, Onno, 2021. "Impact of buyers' support on farmer performance and investments in the Brazilian pork supply chain," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 25(1), July.
    • Handle: RePEc:ags:ifaamr:316354
    DOI: 10.22004/ag.econ.316354
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/316354/files/ifamr2020.0124.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.316354?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Maertens, Miet & Vande Velde, Katrien, 2017. "Contract-farming in Staple Food Chains: The Case of Rice in Benin," World Development, Elsevier, vol. 95(C), pages 73-87.
    2. Claude Ménard, 2005. "New institutions for governing the agri-food industry," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 32(3), pages 421-440, September.
    3. Briones, Roehlano M., 2015. "Small Farmers in High-Value Chains: Binding or Relaxing Constraints to Inclusive Growth?," World Development, Elsevier, vol. 72(C), pages 43-52.
    4. Kersting, Sarah & Wollni, Meike, 2012. "New institutional arrangements and standard adoption: Evidence from small-scale fruit and vegetable farmers in Thailand," Food Policy, Elsevier, vol. 37(4), pages 452-462.
    5. Hualiang Lu & Shuyi Feng & Jacques H. Trienekens & S.W.F. (Onno) Omta, 2008. "Performance in vegetable supply chains: the role of Guanxi networks and buyer-seller relationships," Agribusiness, John Wiley & Sons, Ltd., vol. 24(2), pages 253-274.
    6. Dries, Liesbeth & Germenji, Etleva & Noev, Nivelin & Swinnen, Johan F.M., 2009. "Farmers, Vertical Coordination, and the Restructuring of Dairy Supply Chains in Central and Eastern Europe," World Development, Elsevier, vol. 37(11), pages 1742-1758, November.
    7. Williamson, Oliver E., 2010. "Transaction Cost Economics: The Natural Progression," Journal of Retailing, Elsevier, vol. 86(3), pages 215-226.
    8. Steven Tadelis & Oliver E.Williamson, 2012. "Transaction Cost Economics [The Handbook of Organizational Economics]," Introductory Chapters,, Princeton University Press.
    9. Marc F. Bellemare, 2010. "Agricultural extension and imperfect supervision in contract farming: evidence from Madagascar," Agricultural Economics, International Association of Agricultural Economists, vol. 41(6), pages 507-517, November.
    10. DRIES, Liesbeth, 2015. "The Determinants Of Resource-Providing Contracts: Case-Study Of The Polish Dairy Sector," Review of Agricultural and Applied Economics (RAAE), Faculty of Economics and Management, Slovak Agricultural University in Nitra, vol. 18(1), pages 1-10, March.
    11. Key, Nigel D., 2013. "Production Contracts and Farm Business Growth and Survival," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 45(2), pages 1-17, May.
    12. Johan F. M. Swinnen & Miet Maertens, 2007. "Globalization, privatization, and vertical coordination in food value chains in developing and transition countries," Agricultural Economics, International Association of Agricultural Economists, vol. 37(s1), pages 89-102, December.
    13. Andrei Cechin & Jos Bijman & Stefano Pascucci & Decio Zylbersztajn & Onno Omta, 2013. "Quality in Cooperatives versus Investor‐owned Firms: Evidence from Broiler Production in Paraná, Brazil," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 34(3-5), pages 230-243, April.
    14. Mishra, Ashok K. & Kumar, Anjani & Joshi, Pramod K. & D'souza, Alwin, 2016. "Impact of contracts in high yielding varieties seed production on profits and yield: The case of Nepal," Food Policy, Elsevier, vol. 62(C), pages 110-121.
    15. Loïc Sauvée, 2005. "Alignment between quality enforcement devices and governance structures in the agri-food vertical chains," Post-Print hal-00155424, HAL.
    16. Key, Nigel & McBride, William D., 2008. "Do Production Contracts Raise Farm Productivity? An Instrumental Variables Approach," Agricultural and Resource Economics Review, Cambridge University Press, vol. 37(2), pages 176-187, October.
    17. Handschuch, Christina & Wollni, Meike & Villalobos, Pablo, 2013. "Adoption of food safety and quality standards among Chilean raspberry producers – Do smallholders benefit?," Food Policy, Elsevier, vol. 40(C), pages 64-73.
    18. Heyder, Matthias & Hollmann-Hespos, Thorsten & Theuvsen, Ludwig, 2010. "Agribusiness Firm Reactions to Regulations: The Case of Investments in Traceability Systems," International Journal on Food System Dynamics, International Center for Management, Communication, and Research, vol. 1(2), pages 1-10.
    19. Bellemare, Marc F. & Bloem, Jeffrey R., 2018. "Does contract farming improve welfare? A review," World Development, Elsevier, vol. 112(C), pages 259-271.
    20. repec:dau:papers:123456789/2722 is not listed on IDEAS
    21. repec:taf:entreg:v:23:y:2011:i:3-4:p:89-111 is not listed on IDEAS
    22. Zylbersztajn, Decio & Farina, Elizabeth Maria Mercier Querido, 1999. "Strictly Coordinated Food-Systems: Exploring The Limits Of The Coasian Firm," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 2(2), pages 1-17.
    23. Keijiro Otsuka & Yuko Nakano & Kazushi Takahashi, 2016. "Contract Farming in Developed and Developing Countries," Annual Review of Resource Economics, Annual Reviews, vol. 8(1), pages 353-376, October.
    24. Martins, Franco M. & Trienekens, Jacques & Omta, Onno, 2017. "Governance structures and coordination mechanisms in the Brazilian pork chain – Diversity of arrangements to support the supply of piglets," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 20(4), March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Delelegne A. Tefera & Jos Bijman, 2021. "Economics of contracts in African food systems: evidence from the malt barley sector in Ethiopia," Agricultural and Food Economics, Springer;Italian Society of Agricultural Economics (SIDEA), vol. 9(1), pages 1-21, December.
    2. Otsuka, Keijiro & Ali, Mubarik, 2020. "Strategy for the development of agro-based clusters," World Development Perspectives, Elsevier, vol. 20(C).
    3. Arouna, Aminou & Michler, Jeffrey D. & Lokossou, Jourdain C., 2021. "Contract farming and rural transformation: Evidence from a field experiment in Benin," Journal of Development Economics, Elsevier, vol. 151(C).
    4. Ba, Hélène A. & de Mey, Yann & Thoron, Sylvie & Demont, Matty, 2019. "Inclusiveness of contract farming along the vertical coordination continuum: Evidence from the Vietnamese rice sector," Land Use Policy, Elsevier, vol. 87(C).
    5. Delelegne Abera Tefera & Jos Bijman & Maja Slingerland & Gerben Velde & Onno Omta, 2020. "Quality Improvement in African Food Supply Chains: Determinants of Farmer Performance," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 32(1), pages 152-175, January.
    6. Martins, Franco M. & Trienekens, Jacques & Omta, Onno, 2017. "Governance structures and coordination mechanisms in the Brazilian pork chain – Diversity of arrangements to support the supply of piglets," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 20(4), March.
    7. Stefano Ciliberti & Simone Del Sarto & Angelo Frascarelli & Giulia Pastorelli & Gaetano Martino, 2020. "Contracts to Govern the Transition towards Sustainable Production: Evidence from a Discrete Choice Analysis in the Durum Wheat Sector in Italy," Sustainability, MDPI, vol. 12(22), pages 1-14, November.
    8. John C. Beghin & Miet Maertens & Johan Swinnen, 2017. "Nontariff Measures and Standards in Trade and Global Value Chains," World Scientific Book Chapters,in: Nontariff Measures and International Trade, chapter 2, pages 13-38 World Scientific Publishing Co. Pte. Ltd..
    9. John C. Beghin & Miet Maertens & Johan Swinnen, 2017. "Nontariff Measures and Standards in Trade and Global Value Chains," World Scientific Book Chapters, in: John Christopher Beghin (ed.), Nontariff Measures and International Trade, chapter 2, pages 13-38, World Scientific Publishing Co. Pte. Ltd..
    10. Khan, Muhammad Fawad & Nakano, Yuko & Kurosaki, Takashi, 2019. "Impact of contract farming on land productivity and income of maize and potato growers in Pakistan," Food Policy, Elsevier, vol. 85(C), pages 28-39.
    11. Lin Li & Hongdong Guo & Jos Bijman & Nico Heerink, 2018. "The influence of uncertainty on the choice of business relationships: The case of vegetable farmers in China," Agribusiness, John Wiley & Sons, Ltd., vol. 34(3), pages 597-615, June.
    12. Ruml, Anette & Qaim, Matin, 2020. "Effects of marketing contracts and resource-providing contracts in the African small farm sector: Insights from oil palm production in Ghana," World Development, Elsevier, vol. 136(C).
    13. Bellemare, Marc F. & Bloem, Jeffrey R., 2018. "Does contract farming improve welfare? A review," World Development, Elsevier, vol. 112(C), pages 259-271.
    14. Viet Hoang, 2021. "Impact of Contract Farming on Farmers’ Income in the Food Value Chain: A Theoretical Analysis and Empirical Study in Vietnam," Agriculture, MDPI, vol. 11(8), pages 1-16, August.
    15. Luca Salvatici & Silvia Nenci, 2017. "New features, forgotten costs and counterfactual gains of the international trading system," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 44(4), pages 592-633.
    16. Ogutu, Sylvester Ochieng & Ochieng, Dennis O. & Qaim, Matin, 2020. "Supermarket contracts and smallholder farmers: Implications for income and multidimensional poverty," Food Policy, Elsevier, vol. 95(C).
    17. Maertens, Miet & Swinnen, Johan, 2015. "Agricultural trade and development: A value chain perspective," WTO Staff Working Papers ERSD-2015-04, World Trade Organization (WTO), Economic Research and Statistics Division.
    18. Viet Hoang & Vinh Nguyen, 2023. "Determinants of small farmers' participation in contract farming in developing countries: A study in Vietnam," Agribusiness, John Wiley & Sons, Ltd., vol. 39(3), pages 836-853, July.
    19. Soullier, Guillaume & Moustier, Paule, 2018. "Impacts of contract farming in domestic grain chains on farmer income and food insecurity. Contrasted evidence from Senegal," Food Policy, Elsevier, vol. 79(C), pages 179-198.
    20. Van den Broeck, Goedele & Swinnen, Johan & Maertens, Miet, 2017. "Global value chains, large-scale farming, and poverty: Long-term effects in Senegal," Food Policy, Elsevier, vol. 66(C), pages 97-107.

    More about this item

    Keywords

    Agribusiness; Agricultural and Food Policy;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:ifaamr:316354. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/ifamaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.