19.

Highlight the advantages and disadvantages of contract farming.

Advantages of contract farming: In the contract farming system, the company identifies the crop to be grown, provides the seeds and other inputs, as well as the know-how and often also the working capital. In return, the farmer is assured of a market because the company guarantees that it will purchase the produce at a predetermined fixed price. In this way, contract farming provides financial security to farmers.

Disadvantages of contract farming: It can lead to greater insecurity as farmers become dependent on these companies for their livelihoods. Contract farming of export-oriented products such as flowers and gherkins also means that agricultural land is diverted away from food grain production. In addition, Contract farming caters primarily to the production of elite items, and because it usually requires high doses of fertilisers and pesticides, it is often not ecologically sustainable.