Integrating Smallholders into the Global Economy: Agri-businesses, Contracts and Public Policy in South Africa

This paper intends to contribute to the on-going debate about whether and how agricultural market restructurings can provide viable opportunities for small-scale farmers in Africa. It aims at analyzing contract farming from the smallholders' perspective and at understanding the implications regarding contractual arrangements with processing agribusinesses and/or export firms. Using an original approach that allows linking farm level analysis to territorial and value-chains levels analysis, the research intends to better understanding the complex and multidimensional implications of agricultural structural change. Based on case-studies from the citrus sector in South Africa, the paper argues that contract farming is not a panacea for smallholders. On one hand, contract farming can improve production for farmers; it can also enable better access to services and resources and create real opportunities for smallholders to participate in modern markets. However, on the other hand, the investigation shows that contract farming remains limited both at territorial and value-chain levels: it, mostly involves the already better-off and the larger-scale farmers who have benefited, among others, from significant public support. Moreover, when contract farming includes a handful of smallholders, it can lead to a loss of control and decision rights over production and resources. Overcoming these challenges is essential. The latter will need to be complemented by other measures allowing not only the integration of smallholders into the global economy, but the broader agricultural transformations and structural change. (Résumé d'auteur