Programme de bourses "Echanges Universitaires"
“Analysis of the potato market’s structure and of the mechanisms of price formation in Vereda la Hoya, Tunja, Colombia”
Abstract
In Colombia agriculture is a highly important sector and in the year 2002 contributed to a share of 15 percent of national income. In the province of Tunja and the whole Department of Boyacaá, agriculture makes up even a share of 21 percent and in terms of income generation, potatoes are the most important crop (Agrocadenas, 2004). Farming is characterized by small-scale farming (~ 6 ha) and of the vulnerability to two major pests, which need to be controlled by the use of insecticides and fungicides. The market structure is characterized through atomized supply and concentrated demand and in particular some of the market participants possess excessive market power, which leads to an inefficient market.
Recent demographic and economic developments and the increasing demand for bio-fuels have led to increasing prices of agrochemicals and to a more expensive production of potatoes. Further, potatoes require a particularly large quantity of chemicals and as such is the crop with the highest demand for fungicides and insecticides and the second highest for chemical fertilizers. Consequently a price increase of these input factors could have significant effects on the whole market of potatoes. A further impact on the market could be caused by the liberalization process of Colombia, which through the Free Trade Agreement with the USA will soon reach another milestone. The variation has already been increasing during the last years, which came along with the liberalization process within the Andes and it is thus still open whether the upcoming Free Trade Agreement will have the same effect.
However, the whole market of potatoes has been and is still going through some significant changes and our aim is to analyze their impacts. The main analysis is based on a Value Chain Analysis effected on site (including Farmers, Traders and Expert Interviews), followed by a literature review about the effects of the Free Trade Agreement. Finally we will analyze the trade patterns through an augmented Ricardian and the Heckscher-Ohlin Modell and do a basic time series analysis for a period as long as the availability of data allows us to.
Research Partners
Prof. Dr. Claudia R. Binder Social and Industrial Ecology Department of Geography University of Zurich claudia.binder@geo.uzh.ch |
Giuseppe Feola Research Assistant and PhD student Department of Geography University of Zurich giuseppe.feola@geo.uzh.ch |
Ing. Jaime Diaz Research Director Environmental Engineering Universidad de Boyacà Tunja, Colombia jaimediaz@uniboyaca.edu.co |
Prof. Dr. Rolf Weder Faculty of Business and Economics University of Basel Rolf.Weder@unibas.ch |
Researcher: Immanuel von Aesch Master Student Faculty of Business and Economics University of Basel I.vonaesch@stud.unibas.ch |
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Picture 1: The biggest vegetable market in Colombia (Corabastos, Bogotá) section of potatoes
Picture 2: Potato field after the application of herbicides