World Bank Group2014-12-312014-12-312014-05https://hdl.handle.net/10986/21058Over the past century or so, a wide assortment of pre-harvest agreements, joint ventures, deals, and pledges that can be termed contract farming have been brokered between farmers and buyers. During the 1980s and 1990s, contract farming was frequently criticized as a potentially exploitative arrangement, which favored the more powerful buyer and left the small-scale farmer and the environment vulnerable to abuse. More recently, there is renewed interest from policy makers and their development partners in contract farming as a means of leveraging the recent wave of large-scale investment in land and agriculture to include small-scale farmers and to link them to new market opportunities. The establishment of contract farming becomes a means to link small-scale farmers to markets, which may otherwise be inaccessible for reasons of distance, standards, processing, or any of the other disconnections and impediments that hold them back. However, there have been few attempts to evaluate donor-supported contract farming projects, either financially or economically, or to measure their inclusiveness and their impact in the community. This document aims to provide a task team leader with tools for a critical evaluation of projects promoting contract farming schemes before, during, and after the life span of the project. This toolkit has three objectives: provide guidance on what kinds of contract farming schemes work well, and in what circumstances (the best practice function); provide guidance on how to analyze inclusive contract farming schemes in order to identify those with a good chance of success and sustainability - the right horse to back (the diagnostic function); and provide a framework for applying socio-economic and financial analysis to operations that support such schemes (the cost-benefit function).en-USCC BY 3.0 IGOACCESS TO CAPITALAGRIBUSINESSAGRICULTURAL DEVELOPMENTAGRICULTURAL INVESTMENTAGRICULTURAL MARKETINGAGRICULTURAL PRODUCTIONAGRICULTURAL RESEARCHAGRICULTUREANIMALSANNUAL CROPSARBITRATIONAVERAGE PRICEBENEFICIARIESBEST PRACTICEBUSINESS DRIVERSBUSINESS MODELBUSINESS MODELSBUSINESS OBJECTIVEBUSINESS OBJECTIVESBUSINESS OPPORTUNITIESBUSINESS PLANBUSINESSESBUYERBUYERSCAPABILITIESCAPABILITYCAPITAL EXPENDITURECAPITAL INVESTMENTCASSAVACASSAVA FLOURCASSAVA PROCESSINGCASSAVA PRODUCTIONCOCOACOCOA PRICESCOMMERCIAL FARMERSCOMMERCIAL FARMINGCOMMERCIAL TRANSACTIONCOMMODITIESCOMMODITYCOMMODITY PRICESCOMMUNICATION TECHNOLOGIESCOMMUNICATION TECHNOLOGYCOMPETITIVENESSCONNECTIVITYCONTACT POINTSCONTRACT ENFORCEMENTCONTRACT FARMINGCONTRACT FARMING ARRANGEMENTSCONTRACT LAWCONTRACTUAL RELATIONSHIPSCOOPERATIVESCOPYRIGHTCOTTONCOTTON PRICESCOTTON PRODUCTIONCREDIT RISKSCROPCROP INSURANCECROP MANAGEMENTCROPSDEBTDEGRADATIONDEGREE OF RISKDEVELOPING COUNTRIESDISPUTE RESOLUTIONE-MAILENFORCEMENT OF CONTRACTSEQUIPMENTEXCHANGE RATESEXPENDITUREEXPORTEREXPORTERSFAIRFAOFARMFARM ACTIVITIESFARM EMPLOYMENTFARM EMPLOYMENT OPPORTUNITIESFARM INCOMEFARM PRODUCEFARM REVENUESFARMERFARMER SURVEYSFARMERSFARMING HOUSEHOLDFARMING SYSTEMFARMSFINANCIAL HEALTHFINANCIAL INSTITUTIONFINANCIAL INSTITUTIONSFINANCIAL SUPPORTFISHINGFLOOR PRICEFOOD CROPSFOOD SECURITYFOREST PRODUCTSFRUITSFUTURESFUTURES MARKETGOVERNMENT POLICYGOVERNMENT SUPPORTHORTICULTURAL CROPSHOUSEHOLD INCOMEHUMAN RESOURCESHUSBANDRYHYBRIDSICTINNOVATIONINPUT PRICESINTERNAL RATE OF RETURNINTERNAL RATES OF RETURNINTERNATIONAL BANKINTERNATIONAL DEVELOPMENTINTERNATIONAL FINANCEINTERNATIONAL MARKETINTERNATIONAL MARKETSINVESTINGINVESTMENT POLICYINVESTMENT RISKJOINT VENTURESLABOR MARKETLACK OF COMPETITIONLACK OF CREDITLACK OF TRANSPARENCYLAND HOLDINGLEVEL OF RISKLICENSESLOCAL ECONOMYLOCAL MARKETMACROECONOMIC STABILITYMAIZEMARKET FAILUREMARKET FAILURESMARKET INFORMATIONMARKET OPPORTUNITIESMARKET OPPORTUNITYMARKET PRICEMARKET PRICESMARKET RISKMARKET RISKSMARKET VALUEMARKETING AGREEMENTMARKETING BOARDMARKETPLACEMATURITYMOBILE PHONEMONOCULTUREMORTGAGENEW MARKETNEW MARKETSNEW TECHNOLOGYOIL PALMOPEN MARKETOPERATING ENVIRONMENTPERSONAL COMMUNICATIONPLANTINGPLEDGESPOTATOESPOTENTIAL INVESTMENTPOULTRYPRICE ADVANTAGEPRICE RISKPRICING MECHANISMSPRICING MODELPRICING MODELSPRIVATE SECTORPROCUREMENTPROCUREMENT PROCESSPRODUCEPRODUCER GROUPSPRODUCER ORGANIZATIONPRODUCER ORGANIZATIONSPRODUCT QUALITYPRODUCTION COSTSPRODUCTION PROCESSPRODUCTIVITYPROFIT MARGINSPUBLIC FUNDSPUBLICITYPURCHASINGQUALITY OF SERVICEQUERIESREGULAR PAYMENTRELIABILITYRELIABLE ACCESSREPAYMENTRESERVESRESULTRESULTSRETURNSRICERICE PROCESSINGRISK MANAGEMENTRISK PROFILERURAL PRODUCERSSALESALESSEEDSEED PRODUCTIONSERVICE · MARKETSETTLEMENTSETTLEMENT PROCEDURESHADOW PRICESINGLE CROPSMALL FARMERSMALL-SCALE FARMERSMALL-SCALE FARMERSSMALL-SCALE PRODUCERSSMALLHOLDERSMALLHOLDERSSPOT MARKETSTOCKSSUBSISTENCE FARMERSSUBSTITUTESUBSTITUTIONSUGARSUPERMARKETSSUPPLIERSUPPLIERSSUPPLY OF RAW MATERIALSURPLUSSURPLUSESSUSTAINABLE COFFEETARGETSTAXTAXONOMYTECHNICAL ASSISTANCETECHNICAL SUPPORTTECHNOLOGY TRANSFERTELEPHONETOBACCOTRACEABILITYTRADE BALANCETRADINGTRANCHESTRANSACTIONTRANSACTION COSTSTREE CROPSTURNOVERUSERSVALUE CHAINVALUE CHAINSVEGETABLESVERTICAL INTEGRATIONWAREHOUSEWHEATWHOLESALERSWORKING CAPITALYIELDS10.1596/21058