Preface
Contract farming has been in existence for many years as a means of organizing
the commercial agricultural production of both large-scale and small-scale
farmers. Interest in it continues to expand, particularly in countries that
previously followed a central planning policy and in those countries that have
liberalized marketing through the closing down of marketing boards. Changes
in consumption habits, such as the increasing number of fast-food outlets, the
growing role played by supermarkets in many countries, and the continued
expansion of world trade in fresh and processed products, have also provided
the impetus for further development of this mode of production.
The purpose of this guide is not to replicate past socio-economic studies on
the subject of contract farming. Rather, the aim is to provide advice: first, to
management of existing contract farming companies on how to improve their
operations; second, to companies that are considering starting such ventures
on the preconditions and management actions necessary for success; and, last
but not least, to government officials seeking to promote new contract farming
operations or monitor existing operations. The guide describes in detail the
general modus operandi, internal functions and monitoring mechanisms of
contract farming. It emphasizes that sustainable contract farming arrangements
are only possible when the various parties see themselves involved in a longterm
partnership.