Out-grower schemes as an appropriate model for improving livelihoods of people in rural areas need to be recommended. This is because out-grower schemes provide access to agricultural inputs and market to the rural farmers. These services seem to be scarce, especially in a liberalized economy like Zambia. However, there are debates as whether out-grower schemes have been beneficial to farmers or not.
Therefore, this study aims at investigating the impact of tobacco out-grower schemes on the economic well-being of farmers at Mugubudu tobacco out-grower scheme of Chipata District. To do this, the study employed non-experimental cross sectional research design. 150 questionnaires were distributed to solicit data from 150 randomly selected small scale tobacco farmers using a tobacco farmers' register as sample frame.
The salient findings of the study were that tobacco out-grower schemes had improved the well-being of small scale tobacco farmers. Indicators for this improvement were that small scale tobacco farmers had acquired assets and their consumption expenditure had increased. However, the study established that lack of information as regard to contract contents, insufficiency of extension services, pricing system, environmental hazards and debt from inputs loans as factors that can choke the strides made by out-grower schemes.
The study recommended that information is be provided in local languages as this will reduce the current difficulties as many of agro-literature is published in English. It is necessary that there is improved collaboration, dialogue and negotiation among all stakeholders namely the Ministry of Agriculture through the regulatory body Tobacco Board of Zambia (TBZ), out-grower firms and farmers association on issues such as pricing, dissemination of information and loan management.
The quantity of extension services should be increased and quality improved to enhance productivity which would consequently improve income well-being. Finally, government should make it as policy for tobacco out-grower schemes to embrace efforts of sustainable environmental management as failure to do so have the potential to erode strides made so far in improving the well-being of small-scale tobacco farmers.
Table of Contents
CHAPTER ONE: INTRODUCTION AND BACKGROUND
1.1 Introduction
1.2 Background of the Study
1.2.1 What are Out-grower Schemes?
1.2.2 Types of the Out-grower Schemes
1.2.3 The Zambia National Agricultural Policy (NAP)
1.3 The Statement of the Problem
1.4 Objectives of the Study
1.4.1. Overall Objective
1.5 Research Questions
1.5.1 Overall Research Question
1.6 Significance of the Study
1.7 Scope of the Study
1.7.1 Profile for Eastern Province
1.8 Conclusion
CHAPTER TWO: LITERATURE REVIEW
2.1 Introduction
2.2 Literature Review
2.2.1 Out-side Zambia
2.2.2 With-in Zambia
2.3 Conclusion
CHAPTER THREE: THEORETICAL AND CONCEPTUAL FRAMEWORK
3.1 Introduction
3.2 Theoretical Review of the study
3.2.1 Theories of Contract farming/Out-grower Schemes
3.3 Conceptual Framework
3.4 Definition of Key Operational Terms
3.4.1 Out-grower Scheme/Contract Farming
3.4.2 Small scale Farmer/Smallholder
3.4.3 Agribusiness
3.4.4 Contract
3.4.5 Household Economic Well-Being
3.4.6 Agricultural Extension
3.4.7 Poverty
3.4.8 Impact
3.5 Conclusion
CHAPTER FOUR: RESEARCH METHODOLOGY
4.1 Introduction
4.2 Study Design
4.3 Study Population
4.3.1 Sampling Design and Sampling Procedure
4.4 Data Collection Techniques
4.4.1 Personal Interviews (face to face interview)
4.4.2 Document Review
4.4.3 Questionnaires
4.5 Data Analysis
4.5.1 Chi-Square Test of Independence
4.6 Ethical Considerations
4.6.1 Veracity
4.6.2 Privacy
4.6.3 Confidentiality
4.6.4 Fidelity
4.7 Limitations of the Study
4.7.1 Resources
4.7.2 Competition
4.7.3 Gender
4.7.4 Seasonal Calendar
4.7.5 Loan Repayment
4.8 Conclusion
CHAPTER FIVE: DATA ANALYSIS AND INTERPRETATION
5.1 Introduction
5.2 Demographic Distribution of Respondents
5.2.1 Gender Distribution of Small Scale Tobacco farmers
5.2.2 Age Distribution of Small Scale Tobacco Farmers
5.2.3 Education Status of Small Scale Tobacco Farmers
5.2.4 Marital Status of Small Scale Tobacco Farmers
5.3 Impact of Tobacco Out-grower Scheme on the Well-Being of Small Scale Tobacco Farmers
5.3.1 Status of Income Levels of Farmers before and after joining the Tobacco Out-grower Schemes: N=150
5.4 Level of Knowledge by Farmers about Tobacco Out-grower Schemes
5.4.1 Relationship between Education Level and Knowledge about Contract Content by Small Scale Tobacco Farmers
5.5 Agricultural Extension Services Provided by Tobacco Out-Grower Schemes
5.6 The Impact of Tobacco Out-grower Schemes on the Environment
5.7 Conclusion
CHAPTER SIX: DISCUSSION OF RESULTS
6.1 Introduction
6.2 Impact of Tobacco Out-grower Schemes on the Wellbeing of Farmers
6.3 Farmers’ Level of Knowledge about Tobacco Out-Grower Schemes
6.4 Agricultural Extension Services Provided by Tobacco Out-Grower Schemes
6.5 Impact of Tobacco Out-grower Schemes on the Environment
6.6 Contextualizing the Findings
6.7 Conclusion
CHAPTER SEVEN: CONCLUSION AND RECOMMENDATIONS
7.1 Introduction
7.2 Conclusion
7.3 Recommendations
Research Objectives and Themes
The primary aim of this dissertation is to analyze the impact of out-grower schemes on the economic well-being of small-scale tobacco farmers, specifically examining the Mugubudu tobacco out-grower scheme in the Chipata District of Zambia to determine if these schemes effectively contribute to poverty reduction and livelihood improvement.
- Evaluation of changes in household economic well-being resulting from participation in tobacco out-grower schemes.
- Assessment of farmers' knowledge regarding contract terms, organization, and legal obligations within the out-grower framework.
- Investigation into the adequacy and quality of agricultural extension services provided by tobacco firms to the farmers.
- Analysis of the environmental consequences of tobacco farming and the effectiveness of current mitigation strategies.
Excerpt from the Book
1.2.2 Types of the Out-grower Schemes
Multinational corporations, smaller private companies, parastatals, individual entrepreneurs and farmer cooperatives can all act as agro-industrial firms and financial investors for out-grower system activities. In nearly all cases, the agro-industrial firms are responsible for management of the venture. Out-grower systems through contract farming can be structured in a variety of ways depending on the crop, the objectives, and resources of the firm and the experience of the farmers. Contracting out production is a commercial decision to facilitate an adequate supply within a designated period and at an economic price. Any production can theoretically be contracted out using any of the models; however, certain products favor specific approaches. For example the informal model is usually linked with short-term crops such as vegetables. Generally, any out-grower scheme can fall into one of the following types; centralized model, nucleus estate model, multipartite model, informal model and intermediary model (Eaton and Shepherd, 2001).
1.2.2.1 The Centralized Model
This is a vertically coordinated model where the agro-industrial firm purchases the crop from farmers and processes or packages and markets the product. The agro-industrial firm takes care of the organization structure in a centralized model; it provides management, administration and technical support. These efforts are invested into the scheme, plan, development, mission and task of the whole out-grower system (Abwino and Rieks, 2007).
The centralized scheme is generally associated with vegetables, tobacco, cotton and sugar. Under this model the level of involvement by the firm in the production can vary from a minimum where only the correct type of seed is provided, to the opposite extreme where the company provides land preparation, irrigation system, seedlings, agrochemicals (in organics it could be manure or compost) and even harvesting services. The extent of the involvement of the firm in production is rarely fixed and depends on many different factors e.g. its financial circumstances.
Chapter Summary
CHAPTER ONE: INTRODUCTION AND BACKGROUND: Discusses the rationale for using out-grower schemes as a rural development strategy in Zambia, outlining the study's scope and objectives.
CHAPTER TWO: LITERATURE REVIEW: Examines international and domestic literature regarding contract farming, identifying gaps in current knowledge about its specific impact on the well-being of small-scale farmers.
CHAPTER THREE: THEORETICAL AND CONCEPTUAL FRAMEWORK: Presents the theoretical foundation of the study, including contract enforcement and value chain governance, and defines key operational terms.
CHAPTER FOUR: RESEARCH METHODOLOGY: Describes the pragmatic mixed-method research design, sampling procedures, and ethical considerations employed to investigate the impact on tobacco farmers.
CHAPTER FIVE: DATA ANALYSIS AND INTERPRETATION: Analyzes the gathered quantitative data regarding income levels, contract awareness, and access to extension services among the respondents.
CHAPTER SIX: DISCUSSION OF RESULTS: Synthesizes the empirical findings to assess the overall impact of tobacco out-grower schemes, contextualizing them within existing economic theories and previous studies.
CHAPTER SEVEN: CONCLUSION AND RECOMMENDATIONS: Provides a summary of the research conclusions and offers policy recommendations to stakeholders for improving the efficacy and fairness of out-grower schemes.
Keywords
Out-grower schemes, Contract farming, Small-scale tobacco farmers, Economic well-being, Zambia, Agriculture, Extension services, Contract enforcement, Poverty reduction, Income, Sustainability, Environmental management, Value chain, Chipata District, Rural development
Frequently Asked Questions
What is the core focus of this research?
The dissertation evaluates how tobacco out-grower schemes affect the economic well-being and general livelihoods of small-scale farmers in the Chipata District of Zambia.
What are the central themes explored in the work?
Key themes include the economic impact of contract farming, the quality and accessibility of extension services, farmers' understanding of legal contracts, and the environmental consequences of specialized tobacco production.
What is the primary objective of this study?
The primary objective is to determine if out-grower schemes function as effective tools for poverty reduction by comparing income and asset accumulation of farmers before and after joining these schemes.
Which scientific methodology is employed in this work?
The study utilizes a mixed-method research approach based on pragmatism, integrating quantitative surveys of 150 farmers with qualitative data collection to provide a holistic analysis.
What does the main body of the work address?
The main body focuses on theoretical frameworks (contract enforcement, convention theory), detailed research methodology, data analysis of socioeconomic metrics, and a comprehensive discussion of findings compared to existing literature.
What characterizes this study's research keywords?
The study is characterized by terms related to contractual agriculture, rural economic development, smallholder farming systems, and the specific challenges of tobacco production in the Zambian context.
Why did the study identify a significant knowledge gap?
The study found that although nearly all farmers sign formal contracts, a majority do not actually understand the contents, largely due to language barriers and a lack of transparency by the firms.
What are the environmental risks highlighted?
The research notes that tobacco farming leads to deforestation due to wood requirements for curing, soil erosion, and chemical contamination of local water sources.
How does the study address gender in agriculture?
It highlights that women are significantly marginalized in out-grower schemes, noting that very few women are registered participants compared to men, which limits their access to credit and resources.
What recommendation is made for communication?
The author strongly recommends providing all contract-related information and agro-literature in local languages to ensure farmers can negotiate effectively and make informed decisions.
- Quote paper
- Sunday Silungwe (Author), 2020, Analysis of the Impact of Out-Grower Schemes on the Wellbeing of Small-Scale Tobacco Farmers, Munich, GRIN Verlag, https://www.grin.com/document/520339
