Contract Farming has become an increasingly important aspect of agri-business as well as
poultry sector in recent years. Poultry farming could play an effective role in improving the
economic status of the rural people by increasing their income besides providing nutritious food
through meat and eggs. From the farmer‟s point of view, contractual arrangement can provide
them with access to production services, credit as well as knowledge of new technology and
moreover pricing arrangements can reduce the risk and uncertainty. Contract farming can act as
an effective tool in mitigating risks faced by farmers while marketing of broiler produce to final
consumer. This paper will throw light on contract farming helps both the parties i.e., the
producers and the companies, which are involved in contract farming system. The case study
found that contract farming major benefits come from reduction in transaction costs and
assurance of regular income for broilers farmers. A comparative analysis made of the contract
and non-contract farming techniques carried by specifying how these can be overcome and can
be advantageous to the producer for the overall development and improvement.