Investigating the factors affecting farmers’ intention to adopt contract farming

Abstract

Agricultural endeavors, especially in developing nations, entail inherent risks. Amidst challenges related to capital and agricultural marketing, contract farming emerges as a highly effective strategy. It not only facilitates capital accumulation but also ensures consistent product sales, establishes fair pricing, and contributes to the overall balanced development of the agricultural sector. This concern has been a longstanding global consideration, with Iran now addressing it. Recognizing the paramount importance of implementing contemporary agricultural methodologies, including contract farming, this research systematically investigates factors influencing farmers’ intentions in Iran. A survey methodology is employed for systematic information collection from a statistical population of 98,777 farmers in rural Markazi Province, Iran. Using the Karjesi and Morgan table for sample size determination, a representative subset of 383 farmers is selected through stratified random sampling, ensuring proportional assignment within strata. A researcher-made questionnaire, validated by expert panels and confirmed for reliability through Cronbach’s alpha coefficient, serves as the research instrument. Data analysis was conducted using SPSS 27, and structural equation modeling was performed with SmartPLS4. The findings reveal that trust (0.528), awareness (0.332), and attitude (0.168), exert the most substantial causal influence on farmers’ intention to embrace contract farming. Consequently, the research findings offer practical recommendations for the adoption of contract farming, providing valuable insights to policymakers and stakeholders for implementing targeted interventions aimed at boosting farmers’ willingness to participate in contractual agreements.