DETERMINANTS OF PARTICIPATION IN CONTRACTING FARMING AMONG YAM FARMERS IN THE MION DISTRICT OF THE NORTHERN REGION OF GHANA
Keywords:
contract farming, yam farming, northern region, yam productivity, agricultural financingAbstract
The nature of risk and uncertainty associated with farming, particularly, rain-fed Agriculture, makes it less preferred by banks and other financial institutions in the provision of credit and other forms of financial services. Because of that, many farmers in the Mion District of the Northern Region of Ghana resort to informal financial sources of financing their farming enterprises including contract farming arrangements. Through multi-stage sampling techniques, 400 yam farmers in the Mion District were sampled to assess the driver of farmers’ decision to enter a contract farming arrangement. Data was collected from the sampled farmers through interviews and focus group discussions. Descriptive and inferential statistics were applied in analysing the data. The study found socio-economic characteristics such as age, literacy, income, membership of the farmer-based organisation and farm size, and institutional factors such as access to credit, extension contact, and access to market as significant drivers of yam farmers’ participation in contract farming. Young and educated yam farmers who belonged to farmer-based organizations were found more likely to be engaged in contract farming arrangements. Also, farmers with large farm sizes and those who have access to extension services and alternative income sources were also found more likely to be engaged in contract farming. However, farmers with access to credit and ready market were found less likely to be engaged in contract farming arrangements. It is recommended to the Department of Agriculture in the Mion District to facilitate farmers to more formalized contract farming schemes to help protect the interest of farmers.
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