Determinants of price received by cocoa farmers in Cameroon
2010
Kamdem , Bergaly Cyrile (INRA , Montpellier (France). UMR 1110 Marchés, Organisations, Institutions et Stratégies d'Acteurs) | Galtier , Franck (INRA , Montpellier (France). UMR 1110 Marchés, Organisations, Institutions et Stratégies d'Acteurs) | Gockowski , James (International Institute of Tropical Agriculture(Royaume Uni).) | David-Benz , Hélène (INRA , Montpellier (France). UMR 1110 Marchés, Organisations, Institutions et Stratégies d'Acteurs) | Egg , Johny (INRA , Montpellier (France). UMR 1110 Marchés, Organisations, Institutions et Stratégies d'Acteurs) | Kamgnia Dia , Bernadette (Université de Yaoundé, Yaoundé(Cameroun).)
Various works have demonstrated that small-scale agricultural producers from developing countries do not generally obtain the potential gains linked to marketing. What can be done to help them obtain better prices? In this article, we examine two different solutions: increasing the bargaining power of individual producers and collective marketing through producer organizations (POs). We use data on 2,487 cocoa transactions undertaken by producers in Cameroon during the 2005/2006 season (IITA survey 2006). We first of all explore bargaining theories to identify the determinants of the price received by producers who sell their produce individually, and then, analyse the effect of collective marketing. We show that when the bargaining situation is least favourable to the producers (because the prices are non-negotiable and there is information asymmetry which favours the traders), the traders seize the entire surplus generated by the trade. In order to improve the prices received by producers, it should be necessary to manage their access to credit (so that they will not be bound to any buyer they have obtained credits from, thus ameliorate arbitrate and negotiate the price), and enable them to delay their sale until after the start of the school year (so that traders could no longer know the producers financial need). We also show that selling produce via the POs generally results in a price increase of 9% caused by improvement in the reduction of transaction costs (through economies of scale) and improved bargaining power. The article also examines whether or not the mere presence of a PO in a specific zone enables all the producers in that zone (even those who sell individually) to benefit from higher prices. However, a clear conclusion does not arise in this respect.
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