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Contract farming involves agricultural production being carried out on the basis of an agreement between the buyer and farm producers. Sometimes it involves the buyer specifying the quality required and the price, with the farmer agreeing to deliver at a future date.
The scheme has a long history in Indonesia, where it is commonly known as Inti-Plasma farming, Inti being the nucleus and plasma the smallholdings. It has been implemented in different ways since 1978. The first model was called PIR Lokal (Perkebunan Inti Rakyat Lokal) and was designed for local populations.
The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020 was an act of the Indian Government that creates a national framework for contract farming through an agreement between a farmer and a buyer before the production or rearing of any farm produces. [1] [2]
Paddy field farming goes back thousands of years in Korea. A pit-house at the Daecheon-ni site yielded carbonized rice grains and radiocarbon dates, indicating that rice cultivation in dry-fields may have begun as early as the Middle Jeulmun pottery period (c. 3500–2000 BC) in the Korean Peninsula . [ 24 ]
The household responsibility system replaced collective farming. [1]: 163 In the household responsibility systems, households contributed to state quotas but could also make their own decisions about what to plant on contracted land and could sell via a multi-tier price system that included the lowest price for payment to the state up until the quota, a higher rate for above-quota sales to the ...
Contract farming—which requires the farmers to produce crops for a company under contract—and high value agricultural product increased. [76] Contract farming led to a decrease in transaction costs while the contract farmers made more profit compared to the non-contract workforce. [77]
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Farmers' cooperatives and contract farming are also found to be common organizational structures of organic farming in China. The Chinese government has provided various policy and financial supports for the development of the organic sector.