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Contract farming arrangements are becoming increasingly popular in developing countries. These arrangements, in which farmers agree to produce a given amount of a product and buyers agree to buy that amount, can help improve smallholders’ access to markets and credit opportunities. However, in reality, contract farming arrangements can be plagued with problems – farmers may renege on the agreement if they believe they can get a higher price from a different buyer or market, and buyers may renege because they distrust the quality of the product or the reliability of the farmer.

The 10 th WTO Ministerial Conference , held in Nairobi, Kenya from December 15-19, concluded with six ministerial decisions of significance for developing countries, particularly LDCs. Four decisions revolve around agricultural trade and require clear commitments for both developed and developing countries; an additional two decisions focus solely on benefits for LDCs. Despite what some are calling a “historic” trade package, however, the future of the WTO’s Doha Development Agenda remains uncertain.

In 2006, the African Union Special Summit of the Heads of State and Government, adopted the 12-Resolution “ Abuja Declaration on Fertilizer for the African Green Revolution” , which aimed to increase Africa’s fertilizer use from the then-average 8kg per hectare to 50kg per hectare by 2015.  According to the International Fertilizer Industry Association, however, average fertilizer use in the region today is still only 12kg of fertilizer per hectare, compared to 150kg per hectare average in Asia.

Africa saw strong economic growth between 2001 and 2010, averaging 5.3 percent, but that growth has often not reached poor rural populations. As the sector that supports the livelihoods of 90 percent of Africa’s population and employs 70 percent of the region’s poorest communities, agriculture stands to play an enormous role in increasing sustainable, inclusive economic growth on the continent.

Contract farming has become a popular way to integrate smallholder farmers into modern, high-value markets; however, poorly designed contracts may create additional risks for farmers and even subject them to abuses by larger agricultural players. In July, the FAO, along with UNIDROIT and IFAD, released a Legal Guide on Contract Farming , a comprehensive guide to establishing sound, transparent agricultural contracts between growers and buyers.