Thailand's Contract Farming Act at a Crossroads: Impacts, Shortfalls, and the Need to Better Protect Smallholders

Abstract

ABSTRACT Thailand is a global pioneer in contract farming (CF). Many smallholder farmers have gained better access to markets and capital while achieving higher and more stable incomes. Nevertheless, farmers have also faced exploitative conditions in their contractual relationships with agribusiness companies. In response, the Thai Parliament in 2017 passed the Contract Farming Promotion and Development Act. Based on fieldwork with key actors and contract farmers, this article examines how debates around CF have unfolded over time, the key issues discussed in the reform process before and after the CF Act was enacted, and its implications for smallholders. The law has had some success with increasing transparency, improving the conciliation process between farmers and companies, and deterring companies from unfair practices. However, in reality, it has done little to protect the livelihoods of Thai farmers due to a number of limitations, including weaknesses of the law itself, its limited implementation, and the country’s wider agrarian political economy. Specifically, the country’s oligarchic and oligopolistic political-economic structures have resulted in farmers having little bargaining or political power and limited access to markets.