The Effect of Contract Farming on Rice Yield in the Botanga irriagation Scheme.

Abstract

Contract farming which involves an agreement between a farmer(s) and buyer under specific conditions is supposed to yield mutual benefits. It has gained ground in Ghana`s rice production sector including rice farmers in the Botanga Irrigation Scheme. Farmers are expected to get higher yields through the provision of necessary improved inputs and management advice by the contractors. Meanwhile, there is no empirical evidence on the effect of contract farming on yield. This study aimed to examine the effect of contract farming on rice yield in the Botanga irrigation scheme. A simple random sampling procedure was employed to select a total of 130 respondents. Heckman treatment effect model and Kendall’s coefficient (W) of Concordance were employed as analytical methods for achievement of the objectives. The study revealed that household size, farmer-based organization membership, labour, fertilizer, weedicides and pesticides positively affected rice yield. Extension services and seed however negatively affected rice yield. The achievement of optimum rice yield is constrained by inadequate extension services which renders the farmers deficient of the requisite knowledge and competencies for proper farming culminating into sub-optimal yields. Small farm size and strict specification of contractors were respectively the most pressing and least pressing constraints associated with farmers` decision to participate in contract farming in the study area. The study recommends that government should feasibly expand the land area under irrigation so that farmers can access more land for farming. Farmers should also be stimulated and supported to go into contract farming.