FACTORS AFFECTING VIABILITY OF COFFEE PRODUCTION IN IFUGAO: A REGRESSION ANALYSIS

A host of factors seem to affect coffee production in Ifugao. Aside from the traditional production factors, climate change may have begun to make inroads in the relatively slow performance of the sector considering it being an economic booster of the province of Ifugao. Decrease in production capacities has led to the reduction of coffee production and perturbed livelihood of the Ifugao coffee farmers. Ifugao is one of the few provinces in the Philippines where the four varieties of coffee namely: robusta, excelsa, arabica and liberica thrive. Coffee production and processing in commodity development in the province of Ifugao has once again been given importance by the local government of the province; thus this study primarily aimed on analyzing the factors affecting the coffee production in Ifugao as production has somewhat decreased in the past decades. The study used ordinary least squares regression to analyze the effect of selected economic variables and climate change variables on volume of production. The study used time series data from 1990 to 2017. It was found out that economic variables such as: Demand, Land Area and Farm Gate Price exerted significant effect on Volume of Production of coffee, and that climate change variables such as: Maximum Temperature and Precipitation exhibited significant effect on Volume of Production of coffee as well. The proximity effect exhibited by the findings raises the need for economies of scale in dealing with the factors affecting the viability of coffee production in Ifugao. Efforts to strengthen regional trade and integration may be an important strategy to enhance the industry.