From the Mountains to the Stars ... Doi Chaang Coffee for Sustainability

Abstract

The agricultural sector is still an essential economic sector in Thailand due to the high proportion of agricultural laborers. However, most agricultural products are products that farmers cannot determine their prices. From the predetermined market price, farmers have a higher chance of selling them at a loss. Differentiation and diversification of agricultural products allow farmers to have market power and be able to set their prices. Thus, farmers’ market structure has changed from the perfectly competitive market to the monopolistic competition market. Doi Chaang Coffee is an intriguing case study of Doi Chaang villagers who used to face the same problem since their middlemen had high bargaining power. The situation encouraged the leaders of the Doi Chang people (Khun Panachai Phisailert or Adel) to consult and ask for help with Khun Wicha Phromyong, the primary decision-maker of this case study. Khun Wicha had to decide whether Doi Chaang villagers should take a high level of effort and spend many years developing their coffee quality or not.  If successful, the villagers would no longer be a price taker; if not, they could choose other alternatives such as changing to grow other crops. Furthermore, if the villagers decide to produce high-quality coffee, they should apply for international standards which generate high costs, or not.