Supermarkets in Malyasia's Food Supply Chain: Influence on Traditional Supply Chain and Implications for Contract Farmers

Denise Chin

No 211464, 2015 Conference, August 9-14, 2015, Milan, Italy from International Association of Agricultural Economists

Abstract: Urbanization, growing incomes and changing diets have facilitated the supermarket revolution in Malaysia. Contract farming has been used as a tool to incorporate farmers into the modern supermarket supply chain, mediated by Malaysia’s Federal Agricultural Marketing Authority (FAMA). This study examines the influence of supermarkets on Malaysia’s traditional food supply chain, and the emergence of the supermarket-farmer relationship with smallholder farmers through contract farming, as a result of the new supply chain. Based on an extensive literature review and interviews with FAMA and supermarket representatives, this study finds that the supermarket dominance is present but the relationship between supermarkets and farmers is distant and indirect. While FAMA’s contract farming is a useful effort to increase farmer involvement in the supermarket supply chain, there has been little participation from supermarkets due to their efficient network of suppliers that can adhere to their high quantity and quality demands better than small farmers can.

Keywords: Food; Consumption/Nutrition/Food; Safety (search for similar items in EconPapers)
Pages: 31
Date: 2015
New Economics Papers: this item is included in nep-agr and nep-sea
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Persistent link: https://EconPapers.repec.org/RePEc:ags:iaae15:211464

DOI: 10.22004/ag.econ.211464

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