Contracting commits, via an advance agreement,
farm resources to the production of a
commodity controlled by a central processing
or export enterprise.Formal contracts specify
production and purchasing procedures as
well as credit and pricing mechanisms.Typically
growers provide the requisite land and
labor, while buyers provide specialized planting
material, chemical inputs, and/or technical
services.Contracts may link parastatal or corporate
buyers with growers ranging from small
household producers to large commercial enterprises.The
term ‘‘contract farming’’ is typically
used to describe production by family
farm units for private corporations.