Contract Farming

INTRODUCTION

Agriculture, as an economic activity, has witnessed innumerable institutional innovations over the ages. Since the approach of the agricultural revolution, agricultural processes and institutions have undergone a constant drift of change. One such change has been the advent of make out Farming.
Contract Farming lot be defined as an organisation between farmers and processing and/or marketing firms for the production and cut-rate sale of agricultural products under forward agreements, frequently at determine prices. The arrangement also invariably involves the purchaser in providing a degree of production support through, for example, the supply of inputs and the provision of technological advice. The basis of such agreements is a fealty on the purpose of the farmer to provide a specific commodity in quantities and at quality standards determined by the purchases and a commitment on the part of the company to support the farmers production and to purchase the commodity[1].
The basic structure of a stimulate in agriculture consists of a sponsor, i.e., the company, government body or entrepreneur that purchases the agricultural produce, and the farmers. The contracting res publica framework can is illustrated graphically as follows:

Figure 1.



1: A Contract farming framework

[pic]
Source: based on Eaton, (1998b:274), as given in Eaton and Shepherd, 4

The impact of Contract Farming on a ontogenesis economy is profound. Apart from commercialization of agriculture, it also has a major(ip) impact on peasantry and labour in developing countries. It is, essentially, an inadequate relationship between the economically powerful sponsor, and the comparatively weaker farmer. antecedent the farmer enjoyed a certain degree of autonomy in his choice of production, but now the essential questions of what, how, and for whom to produce are dictated by the sponsor. There is also a submit impact on agricultural labour. Contract Farming creates an assured...If you indispensability to get a full essay, order it on our website: Ordercustompaper.com



If you want to get a full essay, wisit our page: write my paper