Contract Farming
Contract farming is a form of vertical integration where the farmer is contractually bound to supply a given quantity and quality of product to a processing or marketing enterprise. The buyer agrees in advance to pay a certain price to the farmer and often provides technical advice and inputs (the cost of the inputs being deducted from the farmer's revenue once the product has been sold to the buyer). Contract farming has arguably not resulted so far in a significant improvement in the livelihoods of small farmers in developing countries because buyers generally prefer to deal with large-scale producers who are better placed to meet the stringent quality and timeliness requirements.
Read more about this topic: Corporate Farming
Famous quotes containing the words contract and/or farming:
“A contract for better for worse is a contract that should not be tolerated.”
—George Bernard Shaw (1856–1950)
“The measure discriminates definitely against products which make up what has been universally considered a program of safe farming. The bill upholds as ideals of American farming the men who grow cotton, corn, rice, swine, tobacco, or wheat and nothing else. These are to be given special favors at the expense of the farmer who has toiled for years to build up a constructive farming enterprise to include a variety of crops and livestock.”
—Calvin Coolidge (1872–1933)