Baby Corn Business under Contract Farming System

Pornpimol Tongthammachat and Visit Limsombunchai ()
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Visit Limsombunchai: Department of Agricultural and Resource Economics,Faculty of Economics,Kasetsart University,Thailand

No 200801, Working Papers from Kasetsart University, Department of Agricultural and Resource Economics

Abstract: This study compares costs and returns between contract and non-contract farmers on baby corn production and to compares a company’s procurement costs through contract versus non-contract (open market) channels. A survey of 60 farmers in Kanchanaburi and Nakornpathom was conduced for the data of crop year 2005/2006 using questionnaires. The results indicated that the socio-economic situations, problems, and obstacles of both groups were not different. The comparisons of costs and returns between two groups of baby corn farmers showed that the contract farmers had higher net incomes than those of the noncontract farmers. The procurement costs of contract channel were higher than those of noncontract channel. However, the contracting company was willing to pay the additional costs for high quality and traceability (known source of origin) of the products.

Keywords: baby corn; contract farming; costs and returns; procurement costs (search for similar items in EconPapers)
JEL-codes: L24 Q13 (search for similar items in EconPapers)
Pages: 23 pages
Date: 2008-05
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Published in ARE Working Paper No. 2551/1 (May 2008)

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