27.

Explain contract farming and also highlight its advantages.

In the contract farming the company chooses the crop to be grown, provides the seeds and other necessary inputs along the knowledge and often also the working capital. The farmers, in retrun, are assured of a market because the company concerned guarantees that it will purchase the produce at a predetermined fixed price. Consequently, contract farming is very common today in the production of a specialised item such as cut flowers, fruits like grapes, figs, pomegranates, cotton and oilseeds. In this way, contract farming provides security to farmers, it can also lead to greater insecurity as farmers become dependent on these companies for their livelihoods.Contract farming has sociological significance in that it disengages many people from the production process and makes their own indigenous knowledge of agriculture irrelevant. 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.