Factors Influencing Brewery Contract Farming Participation Among Sorghum Farmers in Selected Districts in Dodoma, Tanzania : A Logit Analysis Approach

As contract farming is a useful arrangement that integrates smallholder farmers in the agricultural value chain in developing countries, it is essential for agricultural policies focusing on rural development to implement and promote such initiatives. However, as sorghum farmers are reluctant to participate in contract farming, they face a number of production and marketing issues. In this study, we identified the socio-economic and institutional characteristics influencing sorghum farmers’ participation in brewery contract farming. The study also analyzed the benefits and challenges of contract farming as reported by farmers. The study used data collected for the 2019/2020 production season sourced from 400 sorghum farmers categorized as 176 contract farmers and 224 non-contract farmers. These farmers are located in Kongwa, Chamwino, and Mpwapwa districts in Dodoma, Tanzania. Descriptive statistics were used to analyze farmers’ characteristics corresponding to participation, benefits, and challenges of contract farming. Logistic regression was also employed to analyze the determinant characteristics of contract farming participation. The findings suggest that age, off-farm income, hired labor, both family and hired labor, extension visits, both own and rented land, financial access, as well as savings and credit group membership positively influence contract farming participation. In contrast, household size and sorghum farming experience have a negative influence on contract farming participation. Furthermore, the majority of participants reported the benefit of contract farming as a reliable market source (39%) though the major challenge faced by contract farmers is late grain payment (25%). Therefore, this study recommends that effective policy mechanisms that encourage contract farming participation among sorghum farmers present a better approach to cultivating the contract farming spirit among farmers in selected districts