Café de Marcala - Honduras' GI Approach to Achieving Reputation in the Coffee Market

The objective of the present article is to investigate the importance of geographical indications (GIs) in the coffee market, particularly for Honduran coffees. Geographical indications for coffee have emerged only recently, and only a few scientific studies have been carried out on this topic so far. The present article addresses this lack of research by highlighting recent developments in the coffee market and by presenting the results of a hedonic price analysis that used internet auction data for specialty coffees. The aim of this analysis is to investigate the influence of the region of origin on the achieved auction price of Honduran specialty coffee, controlling for other coffee attributes. The results indicate that coffees from the region Marcala, for which a denomination of origin was established in 2005, possess on average a higher quality than coffees grown in other Honduran regions. Consequently, since quality is the most important price determinant in the internet auctions, coffees from Marcala achieve on average a higher price than coffees from other Honduran coffee-growing regions. However, the hypothesis that Marcala coffees can also achieve a higher price due to an already established reputation could not be confirmed.