Co-operative or coyote? Producers’ choice between intermediary purchasers and Fairtrade and organic co-operatives in Chiapas

Abstract

Coffee producers in many parts of the world have the option of either becoming a member of and selling their coffee to a Fairtrade and organic co-operative, or selling it to a “coyote”, the Central American nickname for intermediary purchaser. This study investigates why different producers make different choices, looking at both material and immaterial costs and benefits of the two choices. A qualitative study from Chiapas (Mexico) finds that a main reason for not choosing the co-operatives is the production requirements that follow organic certification. A survey on production costs confirms that members of an organic co-operative have more work hours than non-members in the same area. A probit analysis indicates that both coffee plot size and number of working household members influence the producers’ decision on sales channel. However, the study also finds that aspects not related to the organic production requirements can affect the choice, such as the level of trust in co-operative leadership, and the co-operatives’ payment systems.