An Analytical Toolkit for Support to Contract Farming

Over the past century or so, a wide assortment of pre-harvest agreements, joint ventures, deals, and pledges that can be termed contract farming have been brokered between farmers and buyers. During the 1980s and 1990s, contract farming was frequently criticized as a potentially exploitative arrangement, which favored the more powerful buyer and left the small-scale farmer and the environment vulnerable to abuse. More recently, there is renewed interest from policy makers and their development partners in contract farming as a means of leveraging the recent wave of large-scale investment in land and agriculture to include small-scale farmers and to link them to new market opportunities. The establishment of contract farming becomes a means to link small-scale farmers to markets, which may otherwise be inaccessible for reasons of distance, standards, processing, or any of the other disconnections and impediments that hold them back. However, there have been few attempts to evaluate donor-supported contract farming projects, either financially or economically, or to measure their inclusiveness and their impact in the community. This document aims to provide a task team leader with tools for a critical evaluation of projects promoting contract farming schemes before, during, and after the life span of the project. This toolkit has three objectives: provide guidance on what kinds of contract farming schemes work well, and in what circumstances (the best practice function); provide guidance on how to analyze inclusive contract farming schemes in order to identify those with a good chance of success and sustainability - the right horse to back (the diagnostic function); and provide a framework for applying socio-economic and financial analysis to operations that support such schemes (the cost-benefit function).

Bibliographic Details

Main Author:	World Bank Group
Language:	English en_US
Published:	Washington, DC 2014-05
Subjects:	ACCESS TO CAPITAL, AGRIBUSINESS, AGRICULTURAL DEVELOPMENT, AGRICULTURAL INVESTMENT, AGRICULTURAL MARKETING, AGRICULTURAL PRODUCTION, AGRICULTURAL RESEARCH, AGRICULTURE, ANIMALS, ANNUAL CROPS, ARBITRATION, AVERAGE PRICE, BENEFICIARIES, BEST PRACTICE, BUSINESS DRIVERS, BUSINESS MODEL, BUSINESS MODELS, BUSINESS OBJECTIVE, BUSINESS OBJECTIVES, BUSINESS OPPORTUNITIES, BUSINESS PLAN, BUSINESSES, BUYER, BUYERS, CAPABILITIES, CAPABILITY, CAPITAL EXPENDITURE, CAPITAL INVESTMENT, CASSAVA, CASSAVA FLOUR, CASSAVA PROCESSING, CASSAVA PRODUCTION, COCOA, COCOA PRICES, COMMERCIAL FARMERS, COMMERCIAL FARMING, COMMERCIAL TRANSACTION, COMMODITIES, COMMODITY, COMMODITY PRICES, COMMUNICATION TECHNOLOGIES, COMMUNICATION TECHNOLOGY, COMPETITIVENESS, CONNECTIVITY, CONTACT POINTS, CONTRACT ENFORCEMENT, CONTRACT FARMING, CONTRACT FARMING ARRANGEMENTS, CONTRACT LAW, CONTRACTUAL RELATIONSHIPS, COOPERATIVES, COPYRIGHT, COTTON, COTTON PRICES, COTTON PRODUCTION, CREDIT RISKS, CROP, CROP INSURANCE, CROP MANAGEMENT, CROPS, DEBT, DEGRADATION, DEGREE OF RISK, DEVELOPING COUNTRIES, DISPUTE RESOLUTION, E-MAIL, ENFORCEMENT OF CONTRACTS, EQUIPMENT, EXCHANGE RATES, EXPENDITURE, EXPORTER, EXPORTERS, FAIR, FAO, FARM, FARM ACTIVITIES, FARM EMPLOYMENT, FARM EMPLOYMENT OPPORTUNITIES, FARM INCOME, FARM PRODUCE, FARM REVENUES, FARMER, FARMER SURVEYS, FARMERS, FARMING HOUSEHOLD, FARMING SYSTEM, FARMS, FINANCIAL HEALTH, FINANCIAL INSTITUTION, FINANCIAL INSTITUTIONS, FINANCIAL SUPPORT, FISHING, FLOOR PRICE, FOOD CROPS, FOOD SECURITY, FOREST PRODUCTS, FRUITS, FUTURES, FUTURES MARKET, GOVERNMENT POLICY, GOVERNMENT SUPPORT, HORTICULTURAL CROPS, HOUSEHOLD INCOME, HUMAN RESOURCES, HUSBANDRY, HYBRIDS, ICT, INNOVATION, INPUT PRICES, INTERNAL RATE OF RETURN, INTERNAL RATES OF RETURN, INTERNATIONAL BANK, INTERNATIONAL DEVELOPMENT, INTERNATIONAL FINANCE, INTERNATIONAL MARKET, INTERNATIONAL MARKETS, INVESTING, INVESTMENT POLICY, INVESTMENT RISK, JOINT VENTURES, LABOR MARKET, LACK OF COMPETITION, LACK OF CREDIT, LACK OF TRANSPARENCY, LAND HOLDING, LEVEL OF RISK, LICENSES, LOCAL ECONOMY, LOCAL MARKET, MACROECONOMIC STABILITY, MAIZE, MARKET FAILURE, MARKET FAILURES, MARKET INFORMATION, MARKET OPPORTUNITIES, MARKET OPPORTUNITY, MARKET PRICE, MARKET PRICES, MARKET RISK, MARKET RISKS, MARKET VALUE, MARKETING AGREEMENT, MARKETING BOARD, MARKETPLACE, MATURITY, MOBILE PHONE, MONOCULTURE, MORTGAGE, NEW MARKET, NEW MARKETS, NEW TECHNOLOGY, OIL PALM, OPEN MARKET, OPERATING ENVIRONMENT, PERSONAL COMMUNICATION, PLANTING, PLEDGES, POTATOES, POTENTIAL INVESTMENT, POULTRY, PRICE ADVANTAGE, PRICE RISK, PRICING MECHANISMS, PRICING MODEL, PRICING MODELS, PRIVATE SECTOR, PROCUREMENT, PROCUREMENT PROCESS, PRODUCE, PRODUCER GROUPS, PRODUCER ORGANIZATION, PRODUCER ORGANIZATIONS, PRODUCT QUALITY, PRODUCTION COSTS, PRODUCTION PROCESS, PRODUCTIVITY, PROFIT MARGINS, PUBLIC FUNDS, PUBLICITY, PURCHASING, QUALITY OF SERVICE, QUERIES, REGULAR PAYMENT, RELIABILITY, RELIABLE ACCESS, REPAYMENT, RESERVES, RESULT, RESULTS, RETURNS, RICE, RICE PROCESSING, RISK MANAGEMENT, RISK PROFILE, RURAL PRODUCERS, SALE, SALES, SEED, SEED PRODUCTION, SERVICE · MARKET, SETTLEMENT, SETTLEMENT PROCEDURE, SHADOW PRICE, SINGLE CROP, SMALL FARMER, SMALL-SCALE FARMER, SMALL-SCALE FARMERS, SMALL-SCALE PRODUCERS, SMALLHOLDER, SMALLHOLDERS, SPOT MARKET, STOCKS, SUBSISTENCE FARMERS, SUBSTITUTE, SUBSTITUTION, SUGAR, SUPERMARKETS, SUPPLIER, SUPPLIERS, SUPPLY OF RAW MATERIAL, SURPLUS, SURPLUSES, SUSTAINABLE COFFEE, TARGETS, TAX, TAXONOMY, TECHNICAL ASSISTANCE, TECHNICAL SUPPORT, TECHNOLOGY TRANSFER, TELEPHONE, TOBACCO, TRACEABILITY, TRADE BALANCE, TRADING, TRANCHES, TRANSACTION, TRANSACTION COSTS, TREE CROPS, TURNOVER, USERS, VALUE CHAIN, VALUE CHAINS, VEGETABLES, VERTICAL INTEGRATION, WAREHOUSE, WHEAT, WHOLESALERS, WORKING CAPITAL, YIELDS,
Online Access:	http://documents.worldbank.org/curated/en/2014/05/23032520/analytical-toolkit-support-contract-farming https://hdl.handle.net/10986/21058
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