Contract Farming: Challenges and Opportunities

Pranav Sethaputra & Bente Meindertsma
Grow Asia & AgriProFocus

Over the last few years, we have seen a growing interest in contract farming schemes in developing countries such as Myanmar. This is not only as a means to increase income and profitability for highly professionalized producers and buyers, but as a production model with the potential to lift smallholder farmers by linking them to market opportunities otherwise inaccessible due to impediments such as distance, processing standards or access to technology. Contract farming should not, however, be thought of as a panacea to eliminate rural poverty - it only makes sense for certain commodities in certain markets.

Due to this interest in the topic, on June 2018, Grow Asia, the Myanmar Agriculture Network (MAN) and AgriProFocus Myanmar ran a joint learning event on contract farming schemes. The main objectives of the event were: (1) to build an understanding amongst our member base of the different contract farming models available and their suitability for Myanmar, (2) to explore good practices from those already implementing contract farming schemes in South East Asia and (3) to identify the key challenges and success factors for effectively engaging and lifting smallholders through contract farming.

To multiply the impact of the event and broaden the reach of the learnings distilled, we have put together this document as a summary of the key take-aways. We hope that you – our partners, stakeholders and peers – will continue to convene and build on this knowledge base, using it as a reference point to guide further action.