Cassava Smallholders’ Participation in Contract Farming in Nakhon Ratchasrima Province, Thailand

Abstract

The most important raw materials for bio-ethanol in Thailand are cassava, sugar cane and molasses. However, cassava has been promoted as a feed stock for ethanol due to the minimal inputs for planting, high productivity and all-year planting and harvesting. The most important factor influencing ethanol using cassava production is the price of cassava feedstock. Contract farming could decrease production costs, increase efficiency in markets, provide lower interest rates, decrease risk management and create symmetric information for cassava smallholders. The scope of this study includes cassava cultivation and factors influencing contract participation using logit analysis. Results from a survey consisting of 130 non-contractors and 127 contractors showed there was a verbal communication between farmers and agricultural cooperatives and written contractual agreement between agricultural cooperatives and processors. In addition, contract participation is significantly influenced by gender of household head, education of household members, number of agricultural groups, input costs, machinery costs, incomes and credit access.

The effectiveness of contract farming for raising income of smallholder farmers in low‐ and middle‐income countries: a systematic review

“…Additional data could not be obtained. Saenz and Ruben (2004)Reason for exclusionNo counterfactual design, not primarily impact study but focused on participation choice Sáenz‐Segura D'Haese et al (2009) Reason for exclusionNo counterfactual design, comparison of different marketing options without adequate control for self‐selection Sänger (Sänger, 2012)Reason for exclusionSame as publications with Torero; no control group of independent farmers Schipmann and Qaim (2011)Reason for exclusionNo counterfactual design (choice experiment on contracts) Setboonsarng , Leung et al (2006)Reason for exclusionNo control for self‐selection Setboonsarng , Leung et al (2006)Reason for exclusionAuthors mention control for unobservables, but no first‐stage results shown. Only results of simulation models are reported Sharma (2008) Reason for exclusionNo counterfactual design (Heckman model, but without IV) Tadesse and Guttormsen (2009)Reason for exclusionOnly study with marketed surplus as dependent variable; no reference group for meta‐analysis Tatlidil and Akturk (2004)Reason for exclusionNo control for selection bias: comparative analysis (as per the title) Tongchure and Hoang (2013)Reason for exclusionMeans comparison; regression on participation choice; verbal contracts Tripathi , Singh et al (2005)…”

Empirical evidence on contract farming in northern Nigeria: Case study of tomato production

“…Kiwanuka and Machethe (2016) result showed that education positively influenced the level/intensity of participation in the interlocked contractual arrangement for dairy in Zambia. Also, Tongchure, and Hoang (2013) found that a household members' level of education positively influenced farmers' likelihood to participate in contract participation in Thailand, noting that farmers who complete higher education would find it easier to understand the information given when receiving advice from the extension agents. The estimated coefficient of farm size was positive and significant in influencing the farmer's level of participation in tomato contract farming at 1% probability level.…”