Threats to contract farming in times of market boom

This book explores smallholder preferences for contract farming (CF) options in the global trade of vanilla from Madagascar. It seeks to identify how to increase the mutual benefit of CF for smallholders and buyers of vanilla. The study found that, in a context of remarkable price volatility that characterizes the vanilla market, improving contractual design is but one of several strategies leading to successful CF outcomes. Several success factors exist in CF, including continued product demand, limited buyer competition, the ability to produce demanded qualities, sufficient time, mutual benefit, mutual trust, mutual dependence, and geographic proximity. In their attempts to access demanded qualities, buyers may try to increase farmer acceptance of CF. The study discovered that sustainable outcomes in CF can be improved by pursuing multiple certifications, strategic corporate social responsibility, and public private partnerships. These improvements can help to increase the perceived benefits of CF from the smallholder perspective. In a critical market period, such as the vanilla price boom of 2016-2018, international vanilla buyers made partial use of above-mentioned strategies.