We use cookies to give you the best experience possible. By continuing we’ll assume you’re on board with our cookie policy

Contract and Corporate Farming Essay Sample

essay
  • Pages: 4
  • Word count: 856
  • Rewriting Possibility: 99% (excellent)
  • Category: agriculture

Get Full Essay

Get access to this section to get all help you need with your essay and educational issues.

Get Access

Introduction of TOPIC

10. Bhumika Pandita
Contract Farming: Contract farming brings private sector into the agricultural scenario. In this case, farming is done under an agreement between farmers and the private firms. In this setup, the producer commits to provide the commodities in a predetermined time and price and the buyer commits to purchase them at that price. Contract farming helps the farmers in having better production inputs, transportation services and extension knowledge. It helps the private firms in setting their feet in the agribusiness world. Contract farming has improved the market linkages with the farms to a great extent. Examples:

1. United Breweries Ltd. has entered into contract farming for production of barley in Punjab. 2. Himalaya Health Care Ltd. has entered into contract farming for the production of ashwagandha in Karnataka. 3. Sami Labs Limited, Bangalore has entered into contract farming for the production of medicinal plants in Karnataka. 4. M/s Dabur India Ltd. has entered into contract farming for the production of pineapple in West Bengal. 5. M/s. Fritto India Ltd. has entered into contract farming for the production of potatoes in West Bengal.

Types of contracts

1. Market specification contracts: It is an agreement that sets conditions for the sale of crop. The conditions refer to price, quality and time in exchange to the buyer providing market outlet. 2. Resource providing contract: This type of agreement sets conditions for the buyer to supply inputs and technical assistance. 3. Production management contract: It contains conditions for farmers to follow a certain farming procedure for higher quality.

Models for contract farming

1. Centralized model: In this model, a centralized buyer is in contract with a number of small farmers. The company provides support for production of crop, their purchase, processing, packaging and marketing e.g. fo

r tobacco, tea, cotton, coffee etc. 2. Nuclear estate model: In this type of model, the company also

Sorry, but full essay samples are available only for registered users

Choose a Membership Plan
owns an estate plantation that ensures a constant supply of material e.g. for tree crops, vegetables, fruits. 3. Multipartite model: As the word multi suggests, multiple organizations are involved i.e., Govt., statutory bodies, private companies with farmers. 4. Informal model: It involves an individual or a small company entering into informal contract with farmers on seasonal basis. There is a minimal amount of processing and financial input involved e.g. in case of watermelons. 5. Intermediary model: there is a contract between companies and intermediary bodies like NGO’s and their own contract with farmers. 6. Tripartite model: This is a three way contract between farmers, company and govt. where Govt. fixes the price.

Example of failures in contract farming

* The Kuppam Project in Andhra Pradesh: The Kuppam pilot was started in Chittoor district under Chandrababu Naidu’s governance as a measure for agricultural development. The project helped M/s BHC (India) Pvt. Ltd. to enter the agribusiness scenario by the application of Israeli technology. The project started in June, 1997. However, when an independent team of scientists examined the project, much criticism was received. Except for the use of Israeli dip technology, everything else was failing. The project was ill designed, unsustainable and expensive. The procedure that was entirely controlled by M/s BHC (India) Pvt. Ltd. resulted in the environmental degradation due to depletion of ground water, use of pesticides and weedicides. Also the condition of farmers was bad as they were working like laborers. As a result the project did not fulfill Govt.’s desired goal.

* Contract farming of hybrid cotton seeds in three districts of Andhra Pradesh: This case of contract farming was highly criticized because of the employment of children as young as six years old. The labor consisted majority of young girls because they worked at very low wages. 0.25 Million young girls have been estimated to be involved. Also due to the standardized hybrid cotton seed production, the children had to work continuously for long duration of time. Thus, this case presented a failure of contract farming. * In Punjab and Haryana, farmers in contract farming faced problems due to faults in the Input.

Corporate Farming: Corporate farming refers to the incorporation of the corporate world into agriculture. This business revolving around agriculture has allowed mega corporations dominating the food industry to get involved in all the stages, from seed production to retail sales by leasing the agricultural land. Corporate farming results in better quality, reduced agricultural waste, introduction of technology in the food production. The corporate farmer usually is a contracted employee.

Examples

IEFFL, Pune for plantation of fruit trees in Maharashtra, Tamil Nadu and Goa. Jamnagar Farms Pvt. Ltd. for agroforestry and horticultural crops in Gujarat and Punjab. Vimal Dairy for milk production in Narmada canal.

References
www.leam.adrocyte.com/hostedresources/nbfagri/contracting arrangementcontractfarming.pdf www.seea.org/specialissue/vol2/34
www.ageconsearch.umn.edu
www.agritech.tnau.ac.in
www.buzzle.com/prosandconsofcorporatefarming

We can write a custom essay on

Contract and Corporate Farming Essay Sample ...
According to Your Specific Requirements.

Order an essay

You May Also Find These Documents Helpful

South American agriculture

In the United States, sectionalism began in 1800s between the North America and the South America. That was the act in various cultural, social and political life styles were displayed in both the North and South. According to Agnew &John definition, “Sectionalism is the act of showing loyalty to a section of your nation where you belong instead of the whole nation. ” The real issues that caused the split between the North and the South were because the North America mainly developed in industrialization while South America depended on agriculture. And in my opinion, the division in the United States was the reason caused Civil War also. The things that brought about the division were lack of agreements concerning taxes levied and the rights of the states versus the rights of federal. The issue that led to the split between the north and the south was the civil war...

Implementation of sustainable agriculture

1. Calls upon Member States, especially those in a position to do so, and relevant United Nations organizations to make greater efforts to promote sustainable agriculture in order to substantiate and fortify global food security. A measure that can be taken to sort this is: a) educating illiterate farmers and smallholding owners, which would inevitably bring about positive changes in terms of modernization and controlled mechanization; 2. Urges the World Bank (WB) and the International Monetary Fund (IMF) as well as governments and banks of countries to: a) disburse loans to smallholding owners to improve their farms and agricultural methods, thereby strengthening food security and empowering smallholding owners b) allow the smallholding owners to repay the loan in easy instalments to put less pressure on the owners and maximise profits; 3. Takes note of the United Nations Conference on Environment and Development’s agreement to de-industrialize farming and further builds upon...

Dependence on agriculture

Almost half the world’s population lives on less than $2 per day. This poverty level persists despite the human intervention (World Bank, 2001). About 800 million people are malnourished and food production will be twice this value within the next 35 years to meet this demand (Watson, 2001). Climate change is a major risk for long-term food security: Countries within the southern hemisphere may suffer from the impact of climate change in the form of reduced crop yield and greater frequencies of extreme weather events (FAO, 2009). The impacts on the standard of living will be greatest in Africa, particularly in East Africa, this mainly because of dependence on agriculture (IPCC, 2001a). About 85% of the livelihood of the population of Ethiopia depends on agriculture, particularly on crop production. Rain fed farming is predominant and has a low productivity (Ermias et al. 2005). The impact of global climate change on...

Popular Essays

logo

Emma Taylor

online

Hi there!
Would you like to get such a paper?
How about getting a customized one?