Department of Agricultural, Food, and Resource Economics Food Security Group

IDWP 78. Pedro V. Martel, Richard H. Bernsten, and Michael T. Weber. 2000. 40 pp. Food Markets, Policy, and Technology: The Case of Honduran Dry Beans

EXECUTIVE SUMMARY:
Since the early 1980s, Honduras’ agricultural sector has stagnated. In the early 1990s, the
government initiated a structural adjustment program expecting to accelerate economic
development. In 1992, the government enacted the Law of Agricultural Modernization and
Development, which called for market liberalization and a complete restructuring of the
agricultural research and extension system. These reforms directly affect the bean subsector, and
have implications for the region, since beans are a major source of proteins and a tradable good
throughout Central America. While the National Bean Research Program has developed several
improved varieties (with international collaborators), its research priorities have been set with
little empirical knowledge about farmers' and market's characteristics and their effects on the
adoption process.

To identify constraints and options to increase bean subsector’s productivity, 239 farmers and 57
city traders were surveyed, and a rapid appraisal of the El Salvadorian market was conducted.
Data were analyzed with descriptive statistics, logistic analysis, and linear regression analysis.

This research shows that farmers' socioeconomic characteristics, production environments, and
institutional factors all affect the varietal adoption process. Catrachita and Dorado, two recently
released varieties, were planted by 23% and 20% of the farmers, respectively. Adoption rates
varied across administrative region, topographical region, and farm size. Catrachita and Dorado
were planted by 27% of Mideastern farmers, and only by 16% and 7% of Northeastern farmers,
respectively. In the hillsides, 76% of farmers planted Catrachita but only 24% in the flatland.
Catrachita was planted by 19% small and medium farmers, and 32% large farmers. At the
market-level, traders paid farmers US$ 0.63/kg for Seda (traditional variety), whereas Catrachita
and Dorado only commanded a price of US$ 0.56/kg and US$ 0.53/kg. Price differences were
partly due to demand from El Salvador. Thus, market links also have important implications for
the adoption of new varieties, especially links to Central American markets. Similarly,
competitiveness of the Honduran bean subsector is highly dependent on policy makers' and plant
breeders' ability to adjust to market participants' demands.