Impact Of Coffee Certification On Small Holder Coffee Farming In Embu County, Kenya

ABSTRACT 

The coffee sector plays a significant role to Kenya‟s economy. The sector contributes to foreign exchange earnings, household incomes, employment and food security. The industry supports about 700,000 households comprising of 535 coffee cooperative societies for the development and marketing of coffee. A new concept in marketing all over the world has been the adoption of certification standards which are becoming increasingly popular in Kenya; currently there are about four certification standards. Whereas adhering to them is beneficial only few coffee societies have been certified. Thus the key objective of this study was to assess the impact of coffee certification on small holder coffee farming in Embu County in Kenya. The specific objectives were to analyze factors that influence small holder coffee farmers‟ decision to participate in certification in Embu County, to assess the impact of certification on farm level productivity and to evaluate the impact of certification on coffee prices. To achieve these objectives, data was collected from 238 certified coffee farms (Households) and 242 non certified coffee farms (Households) using a questionnaire. Logit model was used to establish the factors that influenced farmers to participate in certification. Propensity score matching method was used to solve the selection bias. Results showed that factors such as price and income from coffee, gender of the household head and farmers‟ perception positively influenced participation in certification. On the impact of certification on coffee productivity the study showed that the certified group produced more coffee in some years studied than non-certified group. However the study did not find any impact of the certification program on coffee prices. Certified farmers received higher coffee prices in 2007/2008, but gain disappeared until the year 2010/2011 where the gains were significantly high. The study concluded that the results were consistent with the hypothesized relationship that there were factors that affected farmers‟ decision to participate in certification and there were mixed results in hypothesis two and three. The study recommended that farmers need to be empowered with information on certification, future studies need to consider impact of certification on other farm enterprises in addition to coffee and further research on social, environmental and socio-economic impact assessment needs to be done using emerging business evaluation models and social return to investment.