Appendix A: List of firms undertaking contract farming

There does not exist a database about the companies procuring through contract.
However, I have tried to prepare a list of companies which are carrying out contract
farming. This list (Table A.1) has been compiled through different sources of literature
such as through website of Ministry of Agriculture, GoI, Ministry of Food Processing,
GoI, NABARD, MSAMB, and other print and electronic sources. The list is incomplete
and was during the course of Ph.D. Hence, currently not sure which among them is non-
functional. As can be seen from the Table A.1, that contract farming is carried out in
various crops right from special kind of wheat or basmati paddy, medicinal herbs,
poultry, fruits and vegetables.

Table A.1: Partial List of Companies which have adopted contract farming

S No State Crops Company

Mahaarashtra (Ratnagiri Patchouli (Aromatic
1 S. H. Kelkar Group of companies
and Sindhudurg districts) oil plant)
2 Maharashtra White Onion Jain Irrigation
3 Maharashtra Many Crops Mahindra Shublabh
Champagne (I) Ltd & many other
4 Maharashtra Winery grapes
wineries
5 Maharashtra Table variety grapes Tata Chemicals
Maharashtra (Ambegaon
6 Fodder for 3500 cows Gowardhan Dairy
taluka, Pune district)
Maharashtra (Junnar
7 red onion Panchganga
taluka, Pune district)
Maharashtra (Junnar; 150
8 Banana Gargi Agribiotech
Farmers)
Maharashtra (Wardha,
9 Cotton 12 companies
Yavatmal)
Maharashtra, MP,
10 Gujarat, Karnataka, Safflower Marico
Chattisgarh, Rajasthan
Maharashtra (650
11 farmers, 1200 acres Tomato Varun Foods
Nashik district)
Maharashtra, Andhra Sri. Venkateshwara Hatcheries;Swathi
12 Broiler
Pradesh (AP), TN; Hatcheries; Pioneer; Suguna Poultry
Maharashtra, Gujarat,
13 Punjab, West Bengal, Potatoes, Pepsi Co (I)
Karnataka
Organic products of
Maharashtra, TN, MP, banana, potato, wheat,
14 Ion Exchange Enviro Farms Ltd.
Gujarat, Haryana, papaya, basmati,
cotton
Maharashtra, Punjab, UP, Basmati, Wheat,
15 Rallis
MP, , Karnataka Fruits and Vegetables

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S No State Crops Company
Marigold, Caprica
16 Karnataka AVT Natural Products Ltd
Chilly
17 Andhra Pradesh guar Agrilogix
Gujarat; Punjab; Lahaul Sesame seeds; Potato;
18 McCain (I) Ltd
Spiti (HP) Seed potato
Karnataka and other
19 adjoining area in other herbs Rosun Naturals Products Pvt. Ltd.
states
Global Greens, Sterling Agro
Gherkin, baby corn,
20 Karnataka, AP Products, Ken Agritech,Green Agri
paprika
Pack, Unicorn AgroTech
21 Karnataka, Tamil Nadu Organic Cotton Appachi Cotton Company
Wheat, Maize and
22 Madhya Pradesh Cargill India Pvt Ltd
Soybean
23 Madhya Pradesh Wheat HLL
24 Madhya Pradesh Soyabean ITC - IBD
25 Madhya Pradesh Pomegranate Sanjeevani Orchards
Chilies, Basmati,
26 Punjab PepsiCo
Groundnut
27 Punjab Tomato and chilies Nijjer Agro Foods
28 Punjab Basmati Satnam Overseas, Escorts
29 Punjab Milk Nestle
Punjab, Rajasthan, UP
30 and Maharashtra (200 Baby corn, sweet corn Bharti Del Monte
farmers)
31 Rajasthan Barely SAB-Miller (I)
32 Rajasthan Guar Vikas WSP Ltd
33 Rajasthan (1300 farmers) Barley UB Group through PepsiCo
Paddy (Branded rice
34 TN EID Parry
Ponni)
Source: adapted from electronic and print media sources

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 Appendix B: Farmer Schedule
My name is Varun Miglani. I am the PhD student at Gokhale Institute of Politics and Economics (GIPE), Pune. This study is
being carried out for my PhD thesis. Study attempts to understand economics of contract farming vis-à-vis non-contract
farming. The study also attempts to identify factors influencing farmers’ decision to participate or leave contract farming. I would
like to learn about your experience of contract farming and therefore would ask you certain questions. In case, during the
interview, if you have doubt in any question, please ask me for explanation.I am a student and have no links with any company
or government.Our conversation will be totally confidential and will be used exclusively for research purpose. I will ensure that
whatever I write down will not be viewed by anyone else. There are no direct benefits and risks to you for sharing the
experience. Your cooperation will be very useful for the study and my overall learning. Results of the study will help us in better
understanding of contract farming.

Farmer Crop Season year Current landholding class Type of Irrigation Date
ID No: Contracting status used for crop

Contract farming household grew chip-grade potato in Kharif, 2012-13/white onion in Rabi, 2011-12 1
Non-contract farming household previously in contract for chip-grade potato/white onion 2
Non-contract farming household never grew for chip-grade potato/white onion in contract 3

1. Identification & Demographic Characteristics

1.1 Name of farmer 1.6 Proportion of non-farm income in total
income
1.2 Village 1.7 Age of head HH (years)
1.3 Taluka 1.8 Education of head of HH
1.4 District 1.9 Social Group (SC/ST/NT/OBC/Gen)
1.5 Family Below 15 years 1.10 Main occupation
members Between 15-65 years M 1.11 Subsidiary occupation
within non-studying F 1.12 Experience of farming (years)
household Above 15 yrs studying full-time 1.13 Crop experience
those above 65 years 1.14 Distance of farm to metaled road (km)
Employed in non-farm 1.15 Contact no:
2. Resource Endowments:
2.1 Particulars of land (Acres)
Sr Particulars Owned Leased in Leased out Total Land
1 Rain fed Land
2 Irrigated Land
3 Fallow Land Temporary
Permanent
4 Method of Flood
irrigation Drip
Sprinkler
5 Availability of irrigation+
6 Total Land
7 Terms of lease@
8 Rental value
+ 1: Kharif season only; 2: Rabi season only; 3: All seasons available; 4: Kharif & Rabi only (not
summer);
@ 1. Fixed cash rent; 2. Output sharing; 3.Output and input sharing both

2.2 Compared to other farmers’ lands in your village, would you say that the agricultural land you own is:
1) More fertile; 2) Equally (or just as) fertile; 3) Less fertile

2.3 Livestock
Livestock Bullocks Cows Buffaloes Sheep Goat Poultry Others______
Number
Market value

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 2.4 Machinery and Equipment
Sr. Particulars Number Year of Purchase Purchase price Market Value
1 Bullock Cart
2 Open Well

3 Tube well

4 electric motor

5 Tractor
6 Plougher
7 Rotravator
8 Trolley
9 Tiller (Cultivator) (Panja
10 Paas (Vakhar) of tractor
11 Drip set

12 Sprinkler set

13 Sprayer

14 Bullock Plough
15 Bullock vakhar
16 Other bullock equipments
17 Farm Building
18 Cattle shed
19 Diesel Pump
20

3.1 Cropping Pattern in the past year (Area in acres)

Kharif Rabi
No: Crop Dry/Irrigated Acreage No: Crop Acreage
1 Dry 1
Irrigated 2
2 Dry 3
Irrigated 4
3 Dry 5
Irrigated 6
4 Dry Total
Irrigated Summer
5 Dry 1
Irrigated 2
6 Dry 3
Irrigated 4
7 Dry Total
Irrigated Perennial
8 Dry 1
Irrigated 2
Total Dry 3
Irrigated Total

4. History of contracted crop cultivation & contracting details

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 4.1 In which year, you first time grew chip-grade potato /white onion under contract?
Year Season Company Name
PAST HISTORY
Year Whether Contracting Status and Company Year Whether Contracting Status and Company Name
grew contract Name grew
crop contract crop
2001 1. Yes 1. Contract (________________) 2007 1. Yes 1. Contract (________________________)
2. No 2. Open 2. No 2. Open
2002 1. Yes 1. Contract (________________) 2008 1. Yes 1. Contract (________________________)
2. No 2. Open 2. No 2. Open
2003 1. Yes 1. Contract (________________) 2009 1. Yes 1. Contract (________________________)
2. No 2. Open 2. No 2. Open
2004 1. Yes 1. Contract (________________) 2010 1. Yes 1. Contract (________________________)
2. No 2. Open 2. No 2. Open
2005 1. Yes 1. Contract (________________) 2011 1. Yes 1. Contract (________________________)
2. No 2. Open 2. No 2. Open
2006 1. Yes 1. Contract (________________) 2012 1. Yes 1. Contract (________________________)
2. No 2. Open 2. No 2. Open

4.2 Do you grow chip grade potato/white onion on same piece of plot every year? 1. Yes; 2. No

4.3 How did the first contact happen with the company? (Show card)
1) A friend/neighbour/fellow-farmer/relative introduced me / put in a word for me
2) I contacted the company official /agent on my own
3) The company official/ agent approached me personally
4) The company official/agent was canvassing in the village and asked for volunteers
5) Others (please specify) ___________________________________________________________

4.4 Were there any eligibility criteria that you know of in order to get selected by the firm? Yes/No/
Unaware?
If YES, please list any eligibility criteria. Why do you think you were selected? [show card]

1 trustworthiness 6 Crop experience

2 Hard work and ability 7 Through reference
3 Reputation 8 Availability of irrigation
4 Those who will comply & obey 9 Others
5 Land (good soil) 10

4.5 What were the reasons that led you to join Contract farming?(show
card)_____________________________

1 Good remunerative price 8 Minimum guaranteed price

2 Assured market for produce 9 Friend/neighbor suggestion
3 Seeing the success of co-farmers. 10 Procurement at farm gate
4 Quality seeds 11 Free gunny bags
5 Extension service & technical advice 12 Availability of credit
6 Trustworthiness of company 13 Expecting higher return
7 Good/higher production

4.6 Is it a written contract? 1. Yes (continue); 2. No (Skip to 4.7)

4.7 Do you have a copy? 1. Yes; 2. No
4.8 What is the language of contract? 1. English; 2. Marathi
4.9 Have you read it or had it read to you? 1. Yes; 2. No

4.10 What inputs /services you received directly or indirectly through company? (show card)

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Code Items free Credit Payment Discount Hired
Advance Deferred basis
payment
1 Seeds
2 Organic Fertilizer
3 Equipment, Machinery, Planter
4 Assistance for Bank Loan
5 Extension service
6 Irrigation systems assistance
7 Gunny bags
8 Arranging transport
9 Soil & water testing
10 Training programmes/workshops

4.11 Which of the decisions of farming are controlled by company? (show card)
1 Sowing dates 5 Which pesticide
2 Which seeds 6 When to harvest
3 Which fertilizer 7 Others
4 Which weedicide

4.12 How often did company’s fieldmen/officials visit you in the past crop growing season to discuss
production related matters? (Show card)
1 Once a week 4 Once or twice during the crop cycle
2 Once in 15 days 5 Never
3 Once in a month

4.13 What are the benefits of contract farming with the present firm, you could realize? (show card)
__________________________________________________________________________________
______________________________________________________________________
1 Good remunerative price 6 Minimum guaranteed price
2 Good yields 7 Extension and technical advice
3 Easy credit availability 8 Flexible price
4 Availability of quality seeds/inputs Others (____________)
5 Assured Market for produce

5. Cost of Cultivation of white onion for Rabi season/chip grade potato for Kharif season?

5.1 Method of Plantation

1 Direct sowing in field through bullock/planter Ask Q. 5.2 & then go directly to
2 Hand dibbling 5.3
3 Transplanting (only for white onion) Continue

5.2 Seeds Costs

Seeds Variety Quantity Price Total

Seed treatment chemical cost Rs. FL HL

Section 5.3 for onion growers only, Skip to Section 5.4 for CGP
5.3 Nursery preparation costing
5.3.1 Acreage under nursery preparation? __________
Land preparation Days/hrs Wages (Rs) Total Cost
(A) Ploughing; M F M F M F

203
 harrowing
Machine Labor
Family labor
Hired labour
Bullock labor
(B) FYM/Fertilizers/Weed trolley/qty Price Total Cost Labour cost
icide/fungicide/tonic FL HL ML
Farm Yard Manure

(C) Manual weeding Days/hrs Wages (Rs) Total Cost

M F M F M F
Family labor
Hired labour

5.2.4 Irrigation
No. of FL HL Diesel/Power cost
times Days Wage rate total Days Wage total (months:_____
irrigation rate acreage:________

5.4 Costs on Main Land cultivation

5.4.1 trolley/qty Price Total Cost Labour cost
FL HL ML
1) Farm Yard Manure
2) Fertilizers
Urea
DAP

Labour Days/hrs Wages (Rs) Total Cost

M F M F M F
A) Land preparation (ploughing & harrowing)
Machine Labor
Family labor
Hired labour
Bullock labor
B) Sowing for chip-grade potato/Transplantation for white onion)
Family labor
Hired labour
Bullock labour
C) Weeding (No. of times______)
Machine Labor
Family labor
Hired labour
D) Harvesting, Storage & Grading
Family labor
Hired labour
Bullock labor
Weedicide/Pesticides Qty Price Total Cost FL HL ML
Weedicide
Pesticide
Fungicides

5.5 Irrigation

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No. of FL HL Diesel/Power cost
times Days Wage rate total Days Wage total (months:_____
irrigation rate acreage:________

6. Packaging costs
No. of Rate Total Transpo Hired labour Family labour
bags rt wage
Days Wage rate total Days Wage rate total
M F M F M F M F M F M F
Packing labour
Transport labour

7. Storage costs
7.1 Did u stored up the farm produce? 1. Yes; Period: _______ 2. No
Place of storage Mode of storage Quantity Total Cost

9. Production and marketing details

Seed Productio Whom quantit Selling Total Transport tractor Market (APMC)
Variety n did you y price payment charges / Arthiya
sold*

*1: company; 2: other trader; 3: other company; 4: APMC Market

9.1) How many days after the sale of output, did you receive the full payment?__________days

9.2) Volume of product that you did not sold to company as it did not met company standards? ___kgs

9.3) What did you do with that crop?

1 Left at the farm itself for fodder for sheep/goats 2 Sold in the market

9.4) What is the volume of product that was lost due to spoilage /wastage? ___________ kgs

9.5) Has it ever happened that your produce have been ever rejected by company? 1. Yes; 2. No

Ask Q. 10 only for contract farmers

10. In the last season, had any company/trader approached you regarding the sale of contract crop?
1. Yes; 2. No;
11. What was the prevailing price in the local market or price offered by another company when you sold
your price?
Contract price Price offered by competing Difference
firm/market
previous
back to back season

Q. 12 to 17 only for contract farmers

12. As you would know some of the farmers sell the part of their contract crop to other buyers, have you
ever in the past sold your contract crop to other buyer?
1. Yes (continue); 2. No (Skip to 14)

13. In the last season, have you sold the contract crop to any other buyer (local market or another
company)?
1. Yes (proportion of contract crop: ________ %); 2. No (Continue)

205
 (Reasons: ______________________________) (Skip to 14)

14. Do you sell the part of contract crop to the other buyer/market, every year? 1. Yes;
2. No

15. According to you, what proportion of contract farmers in your village sell their contract crop to other
buyers? __%

16. In general, how important do you think it is for you to honour the contract? (Show card)
1. Very important; 2. Important; 3. Not important;

17. If you were to violate the contract, what do you feel would be the consequences? [Allow farmer to
articulate his/her thoughts, & if appropriate ask questions below to get specific answers as a follow-up]
1 Nothing 6 Fight with us
2 Stop contracting 7 Complaint to village leader
3 Warn us 8 They will lose faith in us
4 They will approach police 9 Will inform other companies
5 Will go to court 10 Others

18. Expectations on Uncertainty

I would like to learn about your expectations regarding yield & price of chip-grade potatoes/White onion.
Based on your experience if and you were to contract with same firm for the similar season and follow
same procedures and assuming general conditions, weather remain unchanged, what is the …
Variable Most likely expected? Minimum value you expect? Maximum value you expect?
Yield (kg/acre)
Price (Rs./kg)

19. What are the risks present for growing contract crop under contract/non-contract farming? (let the
respondent speak & then probe for each attribute) (s
1 Risk of poor quality seeds 4 Risk of firm not coming back to pick up the produce at harvest time
2 Yield risk 5 Risk of rejection of output
3 Price risks 6 Risk of delay in payment

Q. 20 to 22 only for contract growers

20. So far, did you have disputes with company in the past? 1. Yes (Show card); 2. No
Attributes Reason Was it successfully resolved or
not
1 Poor quality of seeds
2 Poor quality of other inputs
3 Late delivery of inputs
4 Rejection of output
5 Higher prices charged for inputs
6 Payments
7 Others

21. In general, if the firm does not honour the contract, what would you do?
1 Nothing, powerless 5 Will lose faith in company
2 Demand Compensation 6 Stop contracting with this firm, contract with other firms
3 Complain to the local authorities /police 7 Give up growing contract crop
4 Will go court 8 others

22. What are the problems do you face in growing the contract crop & was it resolved? (Show card)
___________________________________________________________________
1 Lower price of output 7 Lack of flexibility
2 Poor quality of seeds 8 Unfavorable terms of transactions

206
 3 Rejection of output 9 Fixed rate
4 Higher cost of inputs 10 Not enough assistance from firm
5 Late delivery of inputs 11 Land degradation
6 Late Payments 12 Others (Specify ________________)

Ask Q. 23, only if there was break in contracting otherwise skip

23. There was a break in between year, what was the reason for the break?
1 Company did not offer the contract 4 Water issue
2 Losses with the contract 5 Personal reasons
3 Pest issue 6

24. Based on your experience of contract farming, are you:

Very dissatisfied Dissatisfied Neither satisfied nor Satisfied Very Satisfied
dissatisfied
1 2 3 4 5

25. Any suggestions for improving the contract farming scheme?

_______________________________________________________________________________

26. If you were not contracting for potato/white onion with the firm this season, what would be your next
best option?
a. Grow contract crop for another company or open market (specify name of company)
___________
b. Another crop instead of contract crop _______________________

27. Would you grow the contract crop in the next season? 1. Yes ; (Continue) 2. No; 3. Not decided
28. Would you grow: 1) With the same firm; 2) with another firm or open market

Ask Q29, 30 for ACF only:

29. What were the reasons which led you to exit from the contract farming? (Category 2 farmers; show
card)
_____________________________________________________________________________
1 Lower price in contract 9 change in mindset
2 Lower yield 10 Higher cost of seeds
3 Company did not offered the contract 11 Soil quality deteriorated
4 Rejection for output/strict quality norms 12 Not procurement of whole produce
5 Higher cost of cultivation 13 Personal reasons (like death in the family)
6 Improper payment 14 Lack of transparency
7 Late payment 15 Losses in contract
8 Longer duration crop 16

30. Would you like to join contract farming again? 1. Yes; 2. No; 3. Not decided

Ask Q31, 32 for never participated contract farmer

31. Have you ever tried growing V12 onion? 1. Yes; (What happened:______________ 2. No;
32. Why you did never participated in contract farming? (show card)
1 Lower price in contract 7 Late payment
2 Lower yield 8 Inflexibility
3 Unfavorable terms of transactions 9 Higher price of inputs
4 Rejection for output/strict quality norms 10 Heard about impact on fertility of soil
5 Lack of trust in the company 11 Longer duration crop
6 Lack of transparency in contract 13 Others (__________________________)
33. Credit Constraint Section (Applicable to all categories)
33.1 Did you or household receive any loan in the past 12 months?
a. Yes (Continue) (No: of Loans:________; b. No (Go to Section 9.2)
33.2 Borrowers Section

207
1 List of loans 1 2 3
2 Name of the lender
3 Type of the lender
Formal Semiformal Informal
1 Commercial Bank 3 Cooperative 6 Money lender
2 RRB 4 MFI/SHG 7 Input supplier
8 Arthiya
9 Relative/friend
10 Grocery store
4 What was the loan used for?
1 To buy inputs >>5 5 Education >>6
2 To install perennial crops >>5 6 Consumption >>6
3 To buy agricultural equipment/machinery>>6 7 Other __________
4 Spending related to side business >>6
5 For what crop did you request the loan?
6 Would you have wanted a larger loan at the same interest rate? 1.
Yes >> (constrained); 2. No >> (unconstrained)
33.3 Non-Borrowers Section
1. In the last 5 years, have you applied for a loan from bank/cooperative society and been rejected?
a. Yes (Constrained) (Continue); b. No >> Go to 3
2. Why the loan application got rejected? _______________________________________________

3. Currently, would a bank/cooperative society lend to you if you applied?

a. Yes (Continue); b. No >> Go to 4
4. Why did you not apply? _______________________________________________________
Unconstrained Constrained
1 Sufficient liquidity 4 long processing time, paper work
2 interest rate was too high, 5 Illiterate
3 no profitable investments 6 Demanding collateral
7 Demanding bribery

5. If you were certain that a bank/cooperative society would approve your application, would you
apply? a. Yes (Constrained); b. No >> Continue;
6. Why Not? _____________________________________________________________

Unconstrained Constrained
1 Sufficient liquidity 4 long processing time, paper work
2 interest rate was too high, 5 illiterate
3 no profitable investments 7 Demanding bribery
8 Demanding collateral

---------------------------------------------------------------------------------------------------------------------
34 Locational Attributes
a. Distance of the farmer’s field from the nearest market for contract crop ____________ metres
b. Distance of the farmer’s field from the nearest market for the alternate crop ____________ metres
c. House: 1.Kacha; 2. Pakka

208