Strengthening Agribusiness Partnerships: Piloting Inclusive Contract Farming Training

Photo credit: ABF-GIZ

Ghana, Tamale: Smallholder farmers and agribusinesses often struggle with unstable market access, inconsistent supply chains, and weak contractual relationships, limiting growth opportunities and profitability. Many farmers hesitate to engage in formal contracts due to mistrust and past negative experiences, while off-takers face challenges in securing reliable suppliers who meet quality and quantity requirements.

To address these gaps, the Agri-Business Facility for Africa (ABF) and its partner, Kukobila Nasia Farms Limited, organised a comprehensive training on Inclusive Contract Farming (iCF) in Tamale from February 17-21. The training brought together 24 participants from producer and off-taker organisations, along with expert trainers and facilitators.

As part of ABF’s “Skills for Agribusiness” initiative, this programme introduced a newly revised iCF training package aimed at fostering formal relationships and creating win-win scenarios for all stakeholders. Participants explored business opportunities through iCF, learned from real-world experiences, and gained insights into contract management for sustainable partnerships.

Participant Insights: Learning from Experience
For Charles Atia (B-Diet Limited), a major takeaway was the timing of contract farming agreements. “It is important to begin contract farming before the farming season begins. I also discovered that active engagement amongst all relevant stakeholders, including local communities, is crucial. Without community buy-in, projects could face resistance. Contract farming ensures a consistent supply of raw materials in the right quality and quantity,” he noted.

Hisham Seidu (Kukobila Nasia Farms Limited) reflected on how the training shed light on these issues. “Most contract farming schemes fail because of miscommunication. Farmers and buyers blame each other for dishonesty, but after this training, I realised it often comes down to clear communication. It’s not just about setting terms at the beginning; continuous engagement throughout the entire process eliminates conflicts and builds trust”

GIZ’s Methodology to promote Inclusive Contract Farming
Contract farming is an agreement between farmers and buyers where producers supply agricultural products under predetermined conditions. However, unequal capacities create imbalances; while buyers often have stronger financial resources, market access, and negotiation power, farmers may struggle with limited information, technology, and finance. Inclusive Contract Farming (iCF) addresses these gaps by strengthening farmers’ capacities and promoting fair partnerships, ensuring that both sides benefit from transparent, balanced agreements.

The GIZ methodology to promote contract farming as an inclusive business model (iCF) is based on four principles: Trust that builds on fair and transparent communication, scope of negotiation that recognises farmers as business partners, incentives for mutual benefits, and mitigation and sharing of risks. It focuses on the business model at the interface between suppliers and off takers using tools like the Business Model Canvas and Linear Responsibility Chart, for planning new or improving existing contract farming agreements to create win-win partnerships.

New Training Materials - What’s Different?
The pilot training marked a major milestone for ABF after extensive work on refining the didactic approach to make the methodology more engaging and interactive. It has further enhanced inclusiveness by ensuring that wording, examples, and exercises equally address both producers and off-takers, representing and valuing both perspectives. Additionally, it introduced an Excel-based economic tool to support investment planning, operational cost assessment, cost-sharing, and cost-benefit analysis, providing a solid foundation for decision-making and price negotiations in contract farming agreements.

Creating opportunities for women and youth
Inclusive contract farming offers significant opportunities for women and young farmers, often marginalized in traditional agribusiness structures. Huzeima Abdulai of Ndi Suglo Farms highlighted how contract farming can bridge this gap. “Women and smallholder farmers often lag behind, but contract farming provides the collaboration and input support they need to thrive. With this approach, even farmers with 2 or 3 acres can benefit. As a field officer, this workshop has opened my eyes to better ways of training the community on Farmer Business School, and other important topics.”

The training is designed for management and operational staff of buyer companies and producer organizations (potential or existing contract partners), it can also be combined with Cooperative Business School (CBS) or Farmer Business School (FBS) programmes. The materials are being translated into French to scale up the approach and provide advisory for partners in West and East Africa.

With initiatives like this, ABF continues to support inclusive and sustainable agricultural practices that empower farmers, strengthen value chains, and drive economic resilience in agribusiness across Africa.