Market risks, varietal diversification, and operating income among China’s peach farmers

This study examines the drivers of varietal selection by peach farmers and the operating income consequences of varietal diversification using a 2022 farm survey of 924 producers in Jiangsu, Hubei, Anhui, and Shandong. We develop a conceptual framework linking markets, farmer behaviour and income, estimate count models for varietal number alongside income regressions with quadratic terms, complemented by quantile and heterogeneity analyses and robustness checks. The evidence shows that nursery stock risk, sales channel dependence, and hiring difficulty each significantly increase the number of varieties cultivated, with farmer age moderating the labour constraint effect in an inverted U pattern. These results are robust across ordinary least squares and maximum likelihood estimations and after winsorisation. Diversification exhibits an inverted U relationship with operating income in the full sample, with the turning point lying within the observed range and shifting upward with farm size. Quantile regressions indicate that the marginal income gain from additional varieties declines along the income distribution. Market conditions shape payoffs: in high risk segments, the positive income effect of diversification weakens while the negative effect strengthens. Heterogeneity tests show that a higher share of early-maturing peaches dampens the benefits of adding varieties, whereas a higher share of late-maturing peaches enhances them; farmers specialising in flat peaches gain more from diversification than those focusing on honey peaches. Planting locally leading cultivars allows farmers to hedge risks while leveraging regional spillovers. These findings clarify the behavioural logic of varietal diversification in a perennial fruit sector and inform policies on seedling market governance, marketing infrastructure, labour services, and regional varietal layout.