The performance of contract farming system : the case of mushroom farming in Moyog, Sabah

• Main Author: Lee, Nyuk Choon @ Jamilah Ariffin
• Format: Thesis
• Language: English; English
• Published: 2013
• Subjects: S21-400.5 Documents and other collections
• Online Access: https://eprints.ums.edu.my/id/eprint/41459/1/24%20PAGES.pdf; https://eprints.ums.edu.my/id/eprint/41459/2/FULLTEXT.pdf; https://eprints.ums.edu.my/id/eprint/41459/
• Institution: Universiti Malaysia Sabah

The concept of ‘contract farming’ is a smart partnership between developers and local farmers through joint-venture agreement with win-win situation. The purpose of the concept was to increase production by modernizing its cultivation method and also, guaranteed market for the produce. Generally, this research was to study the performance of the contract farming system in mushroom farming in Moyog, Sabah. Specifically, the objectives were to assess the performance of participation of farmers in mushroom contract farming on their income, to identify factors that significantly contributed to the income generated from the mushroom contract farming, as well as, to study the attitude of the contract farmers towards contract farming system. 54 farmers were selected in the study and they all lived in the Moyog area of Penampang District. A semistructured questionnaire was developed to elicit information from the respondents. The questionnaire contained two types of data namely cross-sectional data and time series data. The cross-sectional data were obtained through face-to-face interviews, while the time series data were compiled from the monthly report of Korporasi Pembangunan Desa (KPD) which is the implementing agent for this mushroom contract farming project. The data collected were then analyzed using descriptive and inferential statistics (i.e. chi-square test and binary logistic regression). The chi-square results showed that age group (≤41 years old and > 40 years old), duration of participation (≤ 5 years and > 5 years), type of participation (part time and full time) and farm scale (≤ 9000 pp bags and > 9000 pp bags) were significantly related to the category of average monthly income of the contract farmers (below and above poverty line income of Sabah). The paired samples t-test also showed that there was a significant difference of average monthly income of the contract farmers before and after participating in mushroom contract farming. Furthermore, the binary logistic regression analysis showed that factors such as, age group, duration of participation, type of participation and farm scale had significantly influenced the category of average monthly income of the contract farmers. In terms of attitude, the descriptive statistics showed that the majority of the respondents agreed that the contract farming system had successfully helped them in increasing and sustaining their monthly income especially in mushroom farming even though some felt that they should be given the chance to do their own marketing in order to fetch higher prices. This contract farming project has successfully retain the productive group and the youth group from migration to urban areas. Most farmers are earning more income compared to their income prior joining the project. In order to achieve an income of RM 960 per month, the farmers need to have at least 9,000 pp bags of mushroom substrate per year and it would only be effective for those who had more than 5 years of participation.