Assessing the impact of contract farming on smallholder farmers’ livelihood in Ghana: the case of cashew farmers in Techiman in the Bono East region

Although contract farming has been widely promoted to link smallholder farmers to the market and enable them to access critical inputs and hence improve their livelihoods and incomes, how and to what extent and in which contexts these materialize requires further empirical investigation. This study examines the ways and the extent to which contract farming affects the household income and livelihood of cashew farmers in the Bono East region of Ghana. The study examines the livelihood of these contract farmers by comparing their livelihood to the non-contracted farmers. It is based on data collected through qualitative interviews and a survey. The study demonstrates that the need to gain access to markets for their produce is one of the key drivers for cashew farmers to join contract farming. Through contract farming arrangements, cashew farmers envisaged better prices for their produce, which, in turn, contribute to enhancing their household income and livelihoods. It showed that not all cashew farmers are producing under contract. Due to the entry barriers/requirements, some interested farmers could not join contract farming arrangements, while others chose not to join to protect their autonomy and independence regarding what to produce and when to sell it, at what price, and to whom. The study underscores the importance of contract farming for smallholder farmers while highlighting its challenges.