MI, A., & Tobe, O. K. Bio-economy and sustainable agrifood value chains: Involvement of local stakeholders through contract farming.
Due to expanding middle-class populations’ increased awareness of food safety and quality as well as the high standards set by developed countries’ export markets, contract farming has a bright future. In many developing nations, contract farming has become more significant. Previous research examined the impact of contracts on the welfare of smallholder farmers, but they often did not take into account the variety of contractual arrangements. As a result, agri- food sustainability makes an effort to use acceptable farming methods’ potential for mitigation to lessen rather than exacerbate the environmental problem and climate change. Prior to now, the focus of policymakers has mostly been on the production end of the food chain. However, for food systems to be sustainable, they must also be productive, environmentally friendly, and provide equitable revenue distribution across the food chain. Whether the products are bought by governmental organizations, multinational corporations, smaller businesses, farmer cooperatives, or independent business owners, it is a factor that is becoming more and more significant in agribusiness. Sponsors must therefore assess how a replacement crop might also be introduced and take into account social attitudes before implementing new cropping practices. Contract farming is frequently seen as a crucial strategy for raising social welfare, strengthening food security, increasing food quality and productivity, and protecting the environment. It aids farmers in overcoming obstacles such lack of capital, insurance, good input availability, output markets, and managerial and technical skills. The majority of studies show that contract farming increases income. The influence of contract farming on farmers’ income, according to certain research findings, is either negligible or even detrimental. This study empirically examines the effects of local stakeholder participation in contract farming on income and farming challenges and theoretically hypothesizes the influencing mechanism.
