Key challenges in Malawi’s paprika supply chain: new insights into contract farming

Repar, Lana; Onakuse, Stephen; Bogue, Joe; Afonso, Ana

doi:10.1080/09614524.2018.1424801

Cited by 3 publications

(3 citation statements)

References 12 publications

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“…In Malawi, CF is well established, particularly in the production of export crops such as tea, cotton, tobacco, green coffee and sugarcane (Kumwenda and Madola 2005;Mugwagwa et al 2019). CF is also growing in the production of paprika and birds-eye chilies (Repar et al 2017;Repar et al 2018). Though on a small scale, there are pockets of CF schemes in the production of cassava, wheat and soybeans.…”

Section: Introductionmentioning

confidence: 99%

Beyond the passbook relationship: Assessing preferences for contracts among cotton and tea farmers and companies in Malawi

Ochieng¹

2020

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While contract farming provides opportunities to link smallholder farmers to markets, its sustainability depends on how the interests of both farmers and buyers are addressed. Previous studies analyze farmers' preferences for contracts, but buyers' preferences for contracts and design attributes are hardly examined. The author contributes to the knowledge gap by analyzing farmers' and buyers' preferences for contracts and design attributes, and the similarities and differences in preferences using a discrete choice experiment with 505 cotton farmers and 512 tea farmers in southern Malawi. Using a mixed logit model, the author examines farmers' and buyers' preferences and estimate farmers' willingness to pay for improvement of contract attributes. Results show that both farmers and buyers have positive preferences for contracts in general and for many design attributes. The author however observes clear differences in preference for payment mode where farmers prefer spot payments while buyers prefer delayed payments. Further, while both parties prefer better quality products, there are no standardized grading systems for the two crops in Malawi. Consequently, buyers are skeptical of farmers' ability to produce quality products while farmers are distrustful of buyers' grading systems. Even though buyers are open to offer contracts that provide inputs or insurance to farmers, there are no information sharing platforms to guide in contracting farmers thus exposing buyers to risks of contract default. The author also finds that farmers prefer contracts that address their social needs as seen in their choice of contracts with funeral expenses insurance. Such attributes could strengthen the relationship between farmers and buying companies. Sustainable contract schemes require designing contracts that are acceptable to both farmers and buyers by balancing risks between the parties. Successful contract relationships have to build business relationships and foster mutual trust by developing standardized grading systems and information sharing platforms for buyers and farmers to guide selection into the schemes. To minimize side-selling, companies can advance cash credit to liquidity constrained farmers, but this must be accompanied by stronger contract enforcement mechanisms.

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Section: Introductionmentioning

confidence: 99%

Beyond the passbook relationship: Assessing preferences for contracts among cotton and tea farmers and companies in Malawi

Ochieng¹

2020

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“…Furthermore, a developed framework for contractual agribusiness relationships is crucial for the building of benevolence and integrity trust. Repar et al. (2018) argue that having a clear contract terms and conditions are important to be included in the framework.…”

Section: Discussionmentioning

confidence: 99%

“…Furthermore, a developed framework for contractual agribusiness relationships is crucial for the building of benevolence and integrity trust. Repar et al (2018) argue that having a clear contract terms and conditions are important to be included in the framework. These terms should address issues related to input provisions, the existence of opportunities for bargaining, participation in contract designs and side selling.…”

Section: Farmer-trader Relationshipsmentioning

confidence: 99%

Farmer–trader relationships in the context of developing countries: a dyadic analysis to understand variations in trust perceptions

Owot

Olido

Okello

et al. 2022

JADEE

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PurposeThe purpose of this study is to analyze trust perceptions between farmers and traders from a dyadic context in developing countries using mixed-method with a specific focus on fresh and dry commodities under contracted and non-contracted markets.Design/methodology/approachA mixed approach was employed. Cross-sectional data were collected from 202 farmers and 188 traders using questionnaires and an interview guide. The Mann–Whitney test was used to assess differences in trust perception. Differences in the excerpts were assessed through content analysis.FindingsResults show differences in perception of trust between farmers and traders on integrity, benevolence and competence in marketing fresh and dry commodities. No detectable differences in trust perception between contract and non-contract markets were observed.Research limitations/implicationsData are limited to Northern Uganda and were collected on trust perception. Besides, there is a scarcity of formal contracts and difficulty in having a matched dyad which could affect generalization.Originality/valueThis is the first study to analyze differences in trust perceptions using a mixed approach in a dyadic context between fresh and dry chains in different markets typologies in developing countries.

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Enabling socially responsible operations: A decision-making model for a firm contracting with decision-biased smallholders

Dutta

Kaur

2022

Ann Oper Res

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Key challenges in Malawi’s paprika supply chain: new insights into contract farming

Cited by 3 publications

References 12 publications

Beyond the passbook relationship: Assessing preferences for contracts among cotton and tea farmers and companies in Malawi

Beyond the passbook relationship: Assessing preferences for contracts among cotton and tea farmers and companies in Malawi

Farmer–trader relationships in the context of developing countries: a dyadic analysis to understand variations in trust perceptions

Enabling socially responsible operations: A decision-making model for a firm contracting with decision-biased smallholders

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