Internal factors that affect competitiveness

In line with the FAO methodology, which was previously mentioned, the positioning capacity in the market was first considered, which is valued through the technological capacity of the producers, as well as the quality of the human resource, aspects that are disaggregated by the following way: monitoring of a technological package, technical assistance and training received, adoption of innovations and training of personnel in the field.

Out of the total of surveyed producers, a total of 317.4 ha is distributed by type of producer (Table 1).

Of which, 86.7% corresponds to plantations in production and 13.3% to plantations in development.

100% of the producers surveyed do not apply a technological package as such, which does not mean, necessarily, that they do not know at all the systems of establishment of the cultivation since the majority chooses by the known ones like box and rectangle that are the most adapted since they allow that the trees have greater aeration and sunlight. Likewise, the information gathered shows that the majority of producers resort to well adapted rootstocks or rootstocks which also favors crop productivity. However, the production volume of the surveyed producers is 2 509.02 t, with an average yield of 7.9 t ha^-1 which is lower than the regional average of 9.68 t ha^-1 and is below the national average yield of 13.8 t ha^-1 (^{SIAP, 2017}).

Within the recommendations of the technological package for the production of lemon is to perform the soil analysis. However, 84.4% of the surveyed producers (both small, medium and large), claim to be based solely on the observation and experience they have as producers to know the nutritional needs of their plots, only one of the respondents answered that they do analysis of soil and the rest only follow indications of houses of agrochemicals, other producers or technical advisors, without any previous analysis.

Regarding technical assistance, the results indicate that only 44.4% of the producers surveyed answered that they have it. The technical assistance service in the region, according to the producers surveyed, is provided mainly by the agrochemicals houses where they acquire their inputs and, to a lesser extent, by professional service providers (PSP), since the latter come every two, four or six months to provide technical advice. Although these forms of advice help producers to fertilize or fight pests, which allows them to maintain a certain productivity, they cannot be considered optimal for various reasons.

In the first place, the consultancies of the agrochemical companies do not necessarily consider the demands of the market, apart from the fact that they generally have a linear expression that leaves the producer as a passive recipient, ignoring their knowledge and needs regarding sustainable development. And, secondly, the eventual technical assistance -even when it could be based on an interactive and agroecological approach- cannot be consolidated due to the scarce frequency with which PSPs come as a result of the lack of permanent governmental programs of technical advice and rural extension. which according to those indicated by ^{FAO (2016)} involve ‘all the different activities that are carried out to provide the information and services demanded by farmers and other actors of the innovation system, to help them develop their capacities technical, organizational and management, in such a way to improve their quality of life and well-being’.

In the case of training, in the last two years, 33.3% of respondents said they had received some type of training, among which stand out: pest and disease management, efficient use of inputs and BPA, 66.7% said not having received any training in this period.

Only the group of producers that have received technical assistance or some training claim to have made some type of innovation in their plots such as: foliar fertilization, pruning and monitoring of disease pests, which has allowed them to increase their levels of productivity. Unfortunately, those who responded to carry out these activities represent less than half of the total producers surveyed. ^{Regunaga (2008)} found that one of the main elements to achieve growth and competitiveness in agriculture is the adoption of innovations. However, in Mexico, in the case of lemon, the increase in production has been based on an increase in the area and not on innovations that improve yield, this is mainly due to the fact that the transfer and adoption of innovations have had multiple limitations , such as the reduced coverage of public technical assistance, which reaches less than 1% of productive units in Mexico, or the use of inefficient methodologies, referred to the transfer of knowledge in the form of recipes by the providers of services to the producer, without considering the particularities of the corresponding case.

Regarding the training component of field staff, the results indicate that only 50% of lemon farmers surveyed responded that they train their workers in the field, the other 50% trust the workers’ experience and do not. Of the 50% that train, the following topics stand out: pruning, fertilization, harvesting and postharvest handling and control of pests and diseases.

With regard to the second internal factor established by the FAO methodology (valuation of market knowledge), the following elements were considered to measure competitiveness: knowledge of national and international standards, BPA and BPM, commercial fruit maturity and induction floral.

The investigation regarding the knowledge that the producers have of the market, gave the following results: 73% of the surveyed producers do not know the export requirements and the quality standards of the product required by the international markets. For the specific case of the study region, 90% of the producers do not know the meaning of certification, and what it means to achieve this process.

In the particular case of Persian lemon, the demands of international markets revolve around the production phase and the packaging process. Europe and Japan are the largest importers of this fruit worldwide. Both countries are very demanding markets in terms of quality and product safety. Among the certifications required by these markets are those related to field production (BPA) and those derived from the packaging process (BPM). These processes represent a novelty for producers and an expensive and complicated process for regional packers.

The commercial maturity of the fruit is another aspect of great importance since it determines the green color of the fruit (the cut should be when the fruit reaches commercial maturity, approximately three months after flowering). In this regard, 58% of producers claimed to harvest at that time, 31% said to harvest two months after flowering and 11% made the harvest 4 months after flowering, which affects the quality of the product by anticipated cuts or untimely.

Although there is a lack of knowledge of the market by most of the producers surveyed, it is necessary to recognize that the requirements of their customers have been identified, such as: the size and color of the product, the absence of defects, as well as the roughness and the thickness of the shell. The main clients of the producers are the intermediaries and the regional packers. 67% of the producers sell to regional or foreign intermediaries, 29% deliver their product to the regional packers and 4% have direct customers in the USA.

In short, the analysis of the two dimensions mentioned above (capacity for positioning and knowledge of the market) and of the elements valued to determine the competitiveness of the production units, it is concluded that, the competitiveness of the production units is low since small producers make only 28.6% of these activities, medium producers produce 39.05% and the rest, 45.7% large producers, which can be seen in Table 2, which also allows to observe the differences by type of producer.

Price-cost competitiveness of Persian lemon producers in the region

To calculate the price-cost competitiveness of the producers, the production costs provided, and the level of income obtained from the sale of the product in the 2015-2016 productive cycle were considered.

The costs were grouped into internal factors, tradable inputs and indirectly tradable inputs. The internal factors are those that do not have an international quotation such as: labor, land, water, credit, electricity and insurance, as well as administration and services. Marketable inputs are those that can be purchased in markets, both nationally and internationally, for example, fertilizers, herbicides, fungicides, diesel and part of machinery. Indirectly tradable inputs include inputs or part of them that are not traded internationally, such as: tractor parts, implements and spare parts (^{Omaña, 2002}). Production costs were obtained by adding the costs of tradable and indirectly tradable inputs plus the costs of internal factors to private prices.

The productive units had different costs according to the type of producer surveyed. The cost for the case of small producers amounted to $ 16 899.00 pesos per hectare, the medium producers had a production cost of $20 518.12 pesos and the large producers reflected an average cost per hectare of $24 206.32 pesos, as can be seen in the Table 3.

If the costs are divided among each of the inputs used for production, it can be observed in small and medium producers that within the internal factors, labor is the one that has the highest percentage of the expenses incurred (more than 60%), while for the group of large producers it represents 48.8%, this because the large producers occupy less personnel per hectare, since their work is mostly mechanized and although the cost per day is more expensive, it does not exceed the amount of wages required by the other two types of producers.

^{Mendoza (2016)}, reaches the same conclusion in his research by showing that the item that represents the highest cost in lemon production is labor, with 51.8% of the total cost structure.

Given that the price of lemon is very variable in each production cycle, it was considered prudent to identify the maximum and minimum prices reached in the cycle analyzed (2015-2016); therefore, we proceeded to multiply the percentage of the average volume produced in each of the seasons marked according to the type of producer by the respective prices reached. Prices are per box of approximately 26 kg (Table 4).

The income for each type of producer, as well as the costs, are different. According to the results obtained, for each hectare cultivated, small producers receive an average income of $31 889.28 pesos, medium producers average a total of $38 977.49 pesos and large producers reflect an average income of $46 550.49 pesos per hectare. The value of production (total income) for a deeper explanation can be disaggregated into its two main components: intermediate consumption and added value.

The net added value of small, medium and large producers corresponds to $24 446.22, $29 938.22 and $31 879.28 pesos respectively, which provides an absolute compensation to the capital of $14 989.58, $18 459.36 and $22 344.17 pesos per hectare, according to each type of producer (Table 5).

This represents what land, capital, labor and administrative work used by producers contribute to the national product.

Table 6 shows the percentages corresponding to each component of income: intermediate consumption and net added value. For each case, a breakdown was made based on 100% of the value of each component.

As can be seen, within intermediate consumption the most important payment is represented by tradable inputs followed by the payment of diverse materials. For the added value, the highest remuneration is received by the capital, followed by the payment of labor.

Profit is defined as the difference between total sales (or per unit) income and the market costs of marketable and indirectly tradable inputs plus internal factors. The calculation of private profitability shows the competitiveness of the production system, given the current technologies and the prices of the product and the factors that are prevailing at that time in the market (^{COLPOS, 2003}). The summary of the difference between income and production costs is presented in Table 7.

The relative remuneration capital producer, allows to demonstrate that for each peso that is destined to the production in a hectare of Persian lemon in the region of the Papaloapan it is gained, depending on the type of producer (small, medium or large), 88, 89 or 92 cents respectively, which means that the activity is profitable for producers in the region.