Forms of Contract
Contract farming is constructed depending on the crops or products, the objectives and
resources of the contractor, and the experience of the farmers (Eaton and Shepherd 2001).
In Thailand, four typical contract models can be identified: the centralized model, the nucleus
estate model, the intermediary and multipartite model, and the formal model, as delineated
in Figure 1 [ PDF 38.2KB | 1 page ].
The nucleus estate model is suitable for commodities requiring immediate processing after
harvest or high production and management technology that farmers lack. The informal
model, which is not as complex, may involve just a few market agents without a written
contract. Different arrangements have an impact on pricing and other economic factors in
the contract farming systems.
Download this Discussion Paper [ PDF 128.1KB| 21 pages ].
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The views expressed in this paper are the views of the authors and do not necessarily reflect the views or policies of the Asian Development Bank Institute (ADBI), the Asian Development Bank (ADB), its Board of Directors, or the governments they represent. ADBI does not guarantee the accuracy of the data included in this paper and accepts no responsibility for any consequences of their use. Terminology used may not necessarily be consistent with ADB official terms.
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