Non-contract Farmers Research Articles

Factors influencing the entrepreneurial behaviour of the contract and non-contract farmers in Haveri district

Factors influencing the entrepreneurial behaviour of the contract and non-contract farmers in Haveri district

Analyzing the Adoption of Improved Production Technologies among Cassava Contract and Non-Contract Farmers in Kogi State, Nigeria

Analyzing the Adoption of Improved Production Technologies among Cassava Contract and Non-Contract Farmers in Kogi State, Nigeria

Analysis of Factors Influencing Output and Cost of Soybean Production: A Comparison between Contract and Non-contract Farmers in the Northern Region of Ghana

Contract farming has emerged as a crucial remedy for bolstering the prospects of small-scale soybean farmers in Ghana. Both governmental bodies and non-governmental organizations, including the Savanna Farmers Marketing Company (SFMC), the Northern Development Authority (NDA), and the Adventist Development and Relief Agency (ADRA), are actively engaging farmers in contracts to grow soybeans. This initiative is especially prominent in the Northern Region of Ghana. This study investigates the factors influencing the output and cost of soybean production, drawing a comparison between contract and non-contract farmers. The research employs stochastic frontier analysis (SFA) and translog functional forms to analyze data collected from 374 soybean growers. The findings reveal that farm size, labour, and agrochemical usage significantly impact soybean output for both contract and non-contract farmers. However, contract farmers exhibit increasing returns to scale, while non-contract farmers experience decreasing returns. Regarding production costs, the study identifies farm size, seed cost, agrochemical cost, and output as significant determinants for the pooled sample. Contract farmers' production costs are primarily influenced by farm size, seed cost, and agrochemicals, whereas non-contract farmers' costs are driven by farm size, seed cost, agrochemicals, and output. The analysis highlights the complementary and substitute relationships among input variables, providing valuable insights for policymakers and stakeholders in the soybean industry. The findings underscore the need for targeted interventions to enhance productivity and cost efficiency for both contract and non-contract soybean farmers.

Comparative Analysis of Contract Farming Effect on Technical Efficiency of Broiler Chicken Farms in Indonesia

The development of broiler chicken farms in Indonesia has taken two forms, namely non-contract and contract farming. This study aimed to compare the technical efficiency levels of production in these two types of farming in Banten Province, Indonesia. Data were collected randomly from 180 broiler chicken farmers, consisting of 103 non-contract and 77 contract farmers. The study used the stochastic frontier production function to meet its objectives. The results showed that non-contract broiler chicken farmers were less efficient in their production than those under contract. The mean technical efficiency of the production factor for non-contract broiler chicken farmers was 0.689, ranging from 0.339 to 0.996. On the contrary, broiler chicken farmers under contract had a higher mean efficiency value of 0.893, ranging from 0.638 to 0.988. Moreover, the type of input supplier had a significant positive effect on technical inefficiency in non-contract farms. Non-contract farmers who purchased their production needs from a poultry shop showed higher technical efficiency compared to those who used distributors. This research sheds light on the efficiency of broiler chicken farms, both non-contract and contract, enabling all stakeholders, including the government, to devise appropriate policies for the development of broiler chicken farming. The study provided valuable insights into the technical efficiency levels of broiler chicken farming in Indonesia, which can help farmers identify areas that need improvement and develop strategies to increase productivity and profitability.

Indian Banana Industry: Unlocking the Production and Trade Potential

The results revealed that drip technology reduced the need for labour, water, growth regulators, plant protection chemicals, fertilizers, and manures, leading to cost savings for farmers. In drip technology, the yield was 19.02 per cent higher, indicating a significant increase in profitability (?77154.6 per ha) compared to the traditional irrigation method. The contract farming model also benefits contract farmers by providing ?135224 per ha more profit than non-contract farmers. The volume and value of banana exports continuously increased in the last eight years. During the study period, India was found to have a comparative disadvantage and lack of competitiveness in the international market in exporting bananas. Therefore, enhancing production, productivity, cost-effectiveness, and quality is essential to improve India's competitiveness in the global banana market.

Does contract farming affect technical efficiency? Evidence from soybean farmers in Northern Ghana

Understanding how and the extent to which contract farming arrangements impact agricultural productivity is important to ensuring that policies are designed to maximize the likelihood of success. Using cross-sectional data from 516 soybean farmers in Northern Ghana, we provide empirical evidence that contract farming increases soybean productivity and technical efficiency in Northern Ghana. We use propensity score matching to reduce bias from observables, and then estimate a stochastic production frontier model that addresses selection bias arising from unobservable variables. We find that the technical efficiency levels of contract farmers are 77 percent compared with 69 percent for non-contract farmers. We also find that access to credit, extension contact, and farmer group membership are key determinants of participating in contract farming.

Are smallholder farmers benefiting from malt barley contract farming engagement in Ethiopia?

BackgroundIt is believed that in Ethiopia barley has been cultivated before 3000BC. Among the cereals, it is ranked in fifth place and the most important crop next to teff, sorghum, and wheat in the country. Different works of literature highlight that engagement in contract farming is one of the innovations promoted to tackle technology constraints of the smallholder farmers, as a possible solution to raising productivity and linking smallholders in the emerging modern marketing chains. Associated with the rapid rate of urbanization in the country, there is a high demand for malt barley which is resulting high expansion of beer factories. Consequently, in the study area, many farmers got into a contract agreement with Assela malt barley factories. Recent studies conducted on malt barley in Ethiopia gave much emphasis to the value chain aspect of malt barley. Therefore, the main motive behind this study was to fill the empirical literature gap in the field by giving much emphasis on the impact assessment of malt barley contract arrangement on income and food items dietary diversity of the respondent households.MethodologyTo attain the study objectives, both primary and secondary data were collected and used. Randomly selected 312 households comprising 127 households engaged in malt barley contract farming arrangements and 185 non-contract households were the source of primary data for this study. Secondary data were collected from a review of different works of literature. Both descriptive and econometric models were used to analyze the primary data using Stata software version 14. The propensity score matching model was applied to examine the impact of malt barley contract farming engagement on the income and dietary diversity of the respondents.ResultIt was found that family size, credit use, livestock holding, malt barley production experience, frequency of extension contact, and land allotted for malt barley production positively determine the probability of participation in malt barley contract farming arrangement. Contrary to this, distance to the malt barley collection centers negatively determine the probability of participation in malt barley contract farming. The ATT estimation of the PSM indicated that participation in malt barley contract farming has a positive impact on the income and dietary diversity of the respondent households.ConclusionParticipation in contract farming had a positive and significant impact on the annual income and dietary diversity of the smallholder households. The sensitivity analysis result showed that the impact results estimated by this study are insensitive to unobserved selection bias and the result obtained shows the true impact of contract farming on the income of the households. Therefore, concerned bodies working on malt barley production aspects as a development intervention should work to encourage non-contract farmers to engage in this activity.

Pengaruh Kemitraan Terhadap Efisiensi dan Risiko Usahatani Bawang Merah di Provinsi Jawa Tengah

Productivity of shallot in central Java as an area production center has a declining trend from 2013-to 2018. One way to increase productivity is through technical efficiency. However, to increase productivity, the probability of production risk will also be higher. Contract farming is one way to increase productivity and overcome production risks in shallot farming. The objectives of this study were to analyze the effect of contract farming on technical efficiency and perception of risks production between contract and non-contract farmers. Secondary data was used in this study. The research sample consisted of 1.508 (10 contract farmers and 1.498 non-contract farmers) shallot farmers in Central Java. The data were analyzed using the stochastic frontier method to see technical efficiency, and the Likert scale to see farmers' perceptions of production risk. The analysis shows that contract farming affected decreasing efficiency. Meanwhile, there is no difference between both farmers in perceptions of the risk of pest and disease attacks. Meanwhile, contract farmers’ perception of the risk of climate change was greater in decreasing production than non-contract farmers. Management efforts by both contract and non-contract farmers to overcome pests and plant diseases are no different. They both prefer chemical methods to overcome pest and disease plant attacks.

Impacts contract farming on cultivation and postharvest practices on red chili farm in Magelang District, Indonesia

Contract farming refers is to carry out the agreement between the buyer and the farmer to reduce risk for both parties. Red chili is rotten, damaged, and has a large shrinkage, causing production, quality and price risks. The study provide an empirical analysis of the impact of contract farming on chili cultivation and postharvest practice. The field survey was conducted in Magelang District as the one of the production centers of red chillies in West Java. Data collected from 40 farmers for contract and 45 farmers for noncontract. The results of the study indicated that the cultivation and post-harvest practices on contract farmers are better in quality, as well as in quantity compared to non-contract farmers. In contract farming, cultivation and post-harvest practices done by farmers are controlled by growers as representatives of the company. Tight control over the products produced by farmers generates not only for the better quality, but also the increase chili farm productivity. Contract farming is recomended to apply other agricultural commodities, specially for high risk commodity which has wid price fluctuation, high quality variation, and susceptible to climate changes.

Decomposition model to compare the productivity difference between contract and non-contract chilli farmers in southern Tamil Nadu

A study was conducted to understand the productivity differences between contract (adopters of GAP technologies) and non-contract farmers (non-adopters of GAP technologies). The study covered three major chilli growing districts in southern Tamil Nadu. The average return to contract farmers was Rs 1,20,174.37 and non-contract farmers was Rs 80,561.25 per hectare of chillies. The parameters governing the input-output relations in the case of contract farms were different from those of non-contract farms. The decomposition analysis showed that the per acre return of contract farming was 55.14 per cent higher than that of non-contract cultivation. The GAP technology component alone contributed 10.99 per cent to the total increase in output while the contribution of all other inputs was 44.15 per cent. The major contributor amongst all the inputs to the difference in returns was the cost incurred by the farmers for adopting the GAP technology (27.42%) followed by farmyard manure (19.00%). Irrigation and the chemical fertilizers were found to be positively contributing but at a lower level ie 1.59 and 0.14 per cent respectively. Land preparation and human labour (human days) were found to reduce the gross return.

Factors Influencing Participation of Farmer in Contract Farming in Narsingdi District of Bangladesh

Aims: Contract farming (CF) has been used extensively to integrate agricultural value chain both in the developed and developing countries. Participation in CF is associated with increased farm productivity and farmer income. Therefore, the purpose of this study was to analyze socio-economic factors affecting farmer’s participation in contract farming.
 Study Design: The selected 15 socio-economic factors were used to determine the impact on farmer’s participation in contract farming. Besides, the socio-demographic profile of the farmers in the study area was discussed.
 Place and Duration of Study: The study was conducted upon contract and non-contract farmers of Shibpur upazila under Narsingdi district of Bangladesh. The duration of the study was from July, 2019 to December, 2020.
 Methodology: The study used nationally-representative data of smallholder vegetable farmers in Shibpur upazila of Narsingdi district. The data were collected from 75 contract farmer and 125 non-contract farmer of Shibpur upazila. Binary logistic regression was used to analyze fifteen factors that potentially affected farmers’ decision to participate in CF and descriptive statistics were used to analyze the socio-demographic profile of the farmer.
 Results: The study found that farmers education, wife’s occupation, family size, labor, fertilizer use, training, savings and income were the significant factors in the model and farmers occupation, other family member's occupation, income source, land type, size of land, experience and storage place were non-significant predictors using P<0.01 and P<0.05 threshold.
 Conclusion: Farmer’s education, female head's occupation, family size, land type, size of land holdings, labor use, type of fertilizers being used, training or technical knowledge and average monthly income of the respondents had a positive influence on farmer’s decision.

Role of Contract Farming in Crop Diversification and Employment Generation: Empirical Evidence from Indian Punjab

Linking small farmers with modern agri-business firms through contract farming is viewed as one of the several ways to achieve crop diversification and enhance farmers’ income, besides bringing spill-over effects of such interventions for other local stakeholders like farm workers. This article examines the role of contract farming in crop diversification and employment generation in the context of Indian Punjab. Based on a sample of 50 contract farmers and 50 non-contract farmers for three firms each, the study shows that contract farming brings crop diversification and generates farm labour employment, particularly for women, due to the high value and labour-intensive nature of crops being grown under such arrangements. But, there exists a gender gap in wages and gendering of tasks, which demand policy and corporate attention besides regulatory oversight to achieve more equitable and pro-poor impact of contract farming.

Small and Marginal Farmers’ Participation in Potato Contract Farming in West Bengal, India

There are ongoing discourses on contract farming across the world. Contract farming is an issue of serious concern in India today, among farmers as well as policymakers. Such farming among small and marginal farmers, who are facing several problems in agriculture, requires special attention. Considering the large presence of small and marginal farmers and PepsiCo’s Frito-Lay model of potato contract farming in the state of West Bengal, which is India’s second largest producer of potatoes, a study is imperative from the perspective of small and marginal farmers and their participation in potato contract farming. The present paper discusses the nature and extent of participation of small and marginal farmers in potato contract farming in the state. Although participation is qualitative and interpretative in nature, the study considers the attributes which are mainly quantitative or measurable. In order to understand the nature and extent of the participation of small and marginal farmers in contract farming, the study also focuses on the participation of other stakeholders such as vendors and non-marginal and small farmers, and a comparison of socioeconomic conditions between the contract and non-contract farmers is undertaken.

Productivity and Technical Efficiency Variability among Small-Holder Cotton Farmers in Tanzania

This study assessed the productivity and technical efficiency variability among small-holder cotton farmers in Bunda district, Tanzania. The efficiency analysis results have shown that the scores of technical efficiency sample of contract farmers varied from 1.75% to 87.07%, with an average of 46.05%. The implication of this is that there existed considerable technical deficiency in cotton farming. That is to say, usually, small-holder cotton contract farmers in the investigation region incurred loss of about 53.95% in outputs as a result of technical deficiency. The sources of inefficiency for contract farmers were experience of contract farmers, gender of household head and owning Television (TV)On the other hand, non-contract small-holder farmers’ technical efficiencies varied from 3.94% to 82.05%, having a mean of 46.79%. Usually, small-holder non-contract farmers in the investigation region incurred loss of about 53.21% in outputs as result of technical deficiency. The implication of this is that output average can be raised by at least 53.21% through the application of resources available as well as the given technology if the deficiency factors are addressed fully. The source of inefficiency for non-contract farmers is owning TV.It is recommended that young farmers need to be encouraged to join contract farming in order to get high productivity, more female headed households should be encouraged to participate in contract farming, both contract and non-contract farmers should watch TV programs which are educative and can assist them gain farm management knowledge for high productivity and lastly, ginners are required to provide more services in exchange of exclusive purchasing rights as agreed when signing contracts.

Factors Affecting Participation in Contract Farming of Smallholder Cavendish Banana Farmers in the Philippines

Participation of smallholder Cavendish banana farmers in contract farming in the Philippines started with the implementation of the Comprehensive Agrarian Reform Law. Multinational and large domestic companies which used to manage their corporate farms had to transfer ownership of lands to the farmers who used to work in these corporate farms. Various contractual arrangements had emerged to engage farmers for these companies to continue their foothold in the export markets where Philippines ranks second. However, some of these arrangements were deemed inequitable that resulted to side-selling and the emergence of spot markets. Participating in contracts or selling in the spot market has corresponding implications to profit generation. Therefore, exploring what influences contract participation of farmers and its role in improving their profit became highly relevant. As such, this paper aimed to examine the factors that affect the decision of farmers to contract or sell in spot market and explore which arrangement yields better profit. Data collected from 187 respondents were analyzed using a probit regression model. Results show that education, farming experience, and credit/financial support significantly affect contract farming participation. The results highlighted the importance of technical skills and knowledge, and financial support in making decisions such as contract participation. Results also show that contract farmers earn higher profits than non-contract farmers which may imply contract farming to be better. Due to the controversies surrounding contract farming, effective mechanisms to regulate contracts are among the recommendations to ensure the welfare of the farmers.

Determinants of Contract Farming Adoption and its Impact on Productivity of Smallholder Cotton Producers in Tanzania

The focus of this paper was on the determinants of contract farming adoption and its impact on productivity to smallholder cotton producers in Bunda District, Tanzania. A survey of 220 contract farmers and 194 non-contract farmers was done by the researcher through personally administered questionnaires. Results from the treatment effects model show that gender of household head, household head age, experience in cotton cultivation, obtaining loan from other sources, being wage-earner, owning cattle, and owning bicycle had influence on adopting contract farming. However, education of household head, household size, off farm activities, owning motorcycle and radio had no influence on adopting contract farming. With regard to impact of contract farming adoption to productivity of smallholder cotton farmers in the investigation region, findings show that there is insignificant impact due to late supply of inputs to farmers by ginners, sprayers were not given on loan basis to farmers for spraying their farms in order to control pests and cultivation service was provided at TShs. 30,000/= upfront which was not afforded by farmers. In this case, Tanzania Cotton Board (TCB) should launch major campaign to educate farmers and ginners on the advantages of contract farming, secondly, ginners should be instructed to supply inputs (cotton seed and pesticides) to farmers timely and lastly ginners should provide sprayers and cultivation services to farmers as agreed when signing contract. Otherwise, contract farming adoption for the purpose of increasing productivity will be a nightmare.

Costs and Returns Structure in Bottle Gourd on the Contract Vis-a-Vis Non-Contract Farms in the Jaipur District of Rajasthan

The present investigation was undertaken with a view to studying the costs and returns structure by the contract and non-contract farmers under contract farming of bottle gourd. Primary data were collected for the agricultural year 2015-16. The cost concepts were used. The results of the study revealed that all types of incomes viz., gross income, family labour income, farm business income and net income were higher on the contract farms than on the non-contract farms. The net income per hectare from bottle gourd was 31.69 per cent higher on the contract farms as compared to the non-contract farms. The total costs were higher on contract farms than on non-contract farms. The net profit was higher on contract farms than on non-contract farms. Returns per rupee were higher on contract farms (` 1.82) than non-contract farms (`1.69).

Impact of contract farming on basmati rice (Oryza sativa) in India

India is world's second largest producer of rice and largest exporter of basmati rice in the world. Total paddy production in the year 2018-19, was 115.6 million tonnes and basmati rice output was 5.31 million tonnes. Basmati rice export is projected to hit a record level of `₹ 30000 crore or nearly $4.28 billion this season. The largest exported basmati variety is Pusa 1121 and the procurement price was `₹ 35000-38000 a tonne in the year of 2018-19 which was 8.5% higher than the price in 2017-18. A study was undertaken to analyse the contract farming dealing with Pusa Basmati 1121 and its economic impact on farmers in Ghaziabad district of Uttar Pradesh during 2017-18. The findings of the study reveal that the impact of contract farming on yield of basmati rice was found to be positive. The total income was more for contract farmers than non-contract farmers. Total input costs were slightly higher on contract farm than non-contract farm. Major factors responsible for farmers’ participation in the contract farming were found to be company guidance for scientific method of cultivation, higher price for produce received from contracting firm, assured purchase by contracting firm and age of the farmer. It is suggested that agricultural marketing and agri-business system needs institutions and innovations, to create and develop different marketing strategy for further increase in agricultural production.

Sustainability Concerns about Contract Farming on Small and Marginal Farmers

Agriculture, in India, contributes a significant role to the Gross Domestic Product (GDP). Sustainability concerns of agriculture, in terms of food security, employment opportunity in rural areas is indispensable. Furthermore, concerns and regulatory mechanism about contract farming and its impact on contracting farmers and non-contract farmers, especially on small and marginal farmers (SMFs) are essential to address for overall rural development at grassroots level. Since, contract farming practices promote mono-cropping pattern of produce, over- fertilisation, it tends to negative and positive concerns on people and prosperity of different section of society differently at different regions.

Impact of contract farming on price: a case study of red chili farmers in Magelang regency

Contract farming is a price control through the agreement of sale arrangement between farmer and firm taken before the starting of production process. Red chili price has a great fluctuation due seasonal production. The objective of the study is to analyze the influence factors red chili price on contract farming. The study compares the constraints on participation, and the impact to the price of red chili between contract and non-contract of farmers. The study carried out in Magelang District, Central Java Province on June to August 2019. Survey method was used with purposive sampling method to 45 respondent of non-contract farmers and 40 respondent for contract farmer. The data analysis used were statistical t-test and coefficient of variation. The results of the study indicated that farmer with contract farming has the minimum price of IDR 9000 per kg and increasing following market price, while the selling price of non-contract farming based on the market price which always fluctuated. Factors affect contract farmers are offering fixed price, and market guarantee while the non-contract farmers are least of information about contract farming. Contract farming should be promoted to sustain chili production and farmer income.