Economic Viability of Converting From Conventional to Organic Coffee Cultivation in Southern Minas Gerais

Abstract

Objective: This study aims to explore the economic viability of converting conventional coffee cultivation to organic practices on a rural property in southern Minas Gerais, assessing the economic and operational impacts of this process. Theoretical Framework: The literature on sustainability in coffee production suggests economic benefits and a reduction in negative environmental impacts for farmers who adopt sustainability certifications. However, empirical evidence is mixed, with studies indicating a dependence on financial premiums to offset the lower productivity of organic cultivation. Method: A case study was conducted on a property that uses both production systems. Data from the 2022/2023 harvest were collected and analyzed, comparing the operational costs and profitability between conventional and organic cultivation methods. Results and Discussion: The findings indicate that the high cost of organic inputs negatively impacted the profitability of organic production, despite the significantly higher sales prices of organic produce. The low productivity of the organic plot resulted in losses, highlighting a gap in the efficiency of production management. Research Implications: The findings of this study suggest the need for more effective management strategies and possibly the development of agricultural technologies that increase the productivity of organic cultivation, without compromising the principles of sustainable agriculture. Originality/Value: This study contributes to existing literature by exploring the conversion of cultivation in a specific and coffee-producing region in Brazil, providing data on the real economic challenges faced by farmers during the transition to sustainable agricultural practices. The detailed analysis of costs and benefits reinforces the complexity and nuances involved in adopting sustainable agricultural practices on a local scale.