Contract farming, an agricultural production and marketing strategy, establishes mutually beneficial partnerships between farmers and sponsors. It enhances farmers’ access to cutting-edge technology and new skill development, and offers a reliable income by mitigating market volatility through predetermined contract pricing.
Since 1975, Charoen Pokphand Foods Public Company Limited (CP Foods) has pioneered an integrated contract farming model in Thailand through the “Promoting Animal Husbandry for Small-Scale Farmers Program” involving over 5,500 smallholders in pig, poultry, and layer hen farming.
The initiative emphasizes knowledge sharing, modern livestock farming technologies, and the adoption of Smart Farm and Green Farm Standards. It aims to promote collective growth within the value chain.
CP Foods mitigates market risks for farmers by guaranteeing product purchases at pre-agreed prices, protecting them from market fluctuations.
Aligning with global UNIDROIT standards, CP Foods has revamped its contract farming practices, ensuring modern, transparent, equitable, and traceable agreements.
CP Foods leads in offering insurance for income-guaranteed contract farms, reducing the impact of disasters on farm infrastructure. These measures provide security to farmers, fostering independence and sustainable well-being.
Warakorn Teesoongnern, of Warakorn Farm, appreciates the clarity and fairness of CP Foods’ contract farming. He emphasizes mutual understanding and shared benefits, ensuring career continuity and a stable family life.
“I aim to transform my farm into a Smart Farm, focusing on responsible, environmentally friendly practices,” Warakorn adds.
Thanasak Onkij of Natalee Farm highlights the trust and standard adherence in their triennial contract renewals with the company. This collaboration ensures food safety and security.
Moreover, the contract farming project supports small-scale livestock farmers, offering expertise and technology for Smart Farm practices.
CP Foods continually enhances its contract farming model, enriching agricultural value and passing the trade to future generations.
This initiative ensures Thai farmers stable careers and secures the food production chain and national food security.