Tuesday, December 14, 2010

JOURNAL: Institutional environment and competition patterns of organic products in Brazil

ABSTRACT: Concerned with food safety, consumers all over the world are willing to pay premium prices for “natural food” that is supposed to be free from chemical products and other sources of contamination. “Organic food” is a particular production standard that cannot be observed and verified by customers and consumers at low cost. Moreover, safety is an issue for the organic products sector just as much as it is for conventional products.  
This paper addresses the issue of managing and signaling this particular food standard, in the Brazilian weak regulatory environment, where government has lost reputation as a reliable authority regarding food safety. Departing from the assumption that the consumer of organic products is looking for safety, this research intends to identify the governance structures adopted by retailers, industries, and farmers to guarantee the authenticity and reliability of their products. Finding ways to preserve reputation and premium prices in a weakly regulated environment is a real challenge, especially for fresh products. This study investigates if organic products suppliers are aware of this threat and how they are managing the supply and distribution chain to guarantee their competitive advantage. 

Key Words: Organic products, Food safety, Supply Chain management
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