Impact of Agribusiness Contract on Smallholder Farmers’ Incomes in Senegal Delta River and Mauritius

Abstract

Agribusiness is one of the policy options in most countries to ensure food security, reduce poverty and support family farming towards modernization. Under these conditions, farmers and agribusiness companies are entering into agricultural contracts in some developing countries, like Senegal and Mauritius. This research aims to evaluate the impact of agribusiness contracts on farmers' incomes in the Senegal River Delta and Mauritius. The sample surveyed is 270 farmers in Mauritius (93 treated) and 320 in the Senegal Delta (147 treated), coupled with interviews and bibliographic research. To analyze the data, we used the propensity score matching method based on the counterfactual approach. The impact of agricultural contracts on farmers' incomes in Mauritius is € 1,648 per agricultural season with a threshold of 10% of significance. In the Senegal Delta, this impact is € 505, but it is not significant. This research therefore suggests that agribusiness production contracts are more favorable to improve the agricultural income of family farms.

Keywords: agricultural contract, family farm, impact, income.

DOI: 10.7176/JESD/10-12-10

Publication date:June 30^th 2019