UNDERSTANDING CONTRACT FARMING: A COMPREHENSIVE STUDY

Abstract

The organizing agricultural production, contract farming has been in existence for decades and in recent years its use appears to have been expanding quite rapidly, including in much of Africa. But what exactly do we mean by the term? Sometimes it refers to cases where the buyer specifies the quality required and the price offered, and the farmer commits to deliver at a future date. Commonly, however, contract farming implies more than a farmer just having a contract to supply a buyer. The important feature is that the buyer has some say in how, when and where a product is produced and harvested. For example, a farmer who is growing certified seeds at an agreed price, using the foundation seed supplied by a seed company, using inputs either supplied by or recommended by the company and following all recommended production practices is doing contract farming.