Contract Farming in the Morocco Cereal Sector: Contract Clauses, Ambiguity, and Opportunism

Bouichou El Houssain; Aziz Fadlaoui; Khalil Allali; Radouan Arrach

doi:doi:10.11648/j.ijae.20190405.17

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Contract Farming in the Morocco Cereal Sector: Contract Clauses, Ambiguity, and Opportunism

Bouichou El Houssain, Aziz Fadlaoui, Khalil Allali, Radouan Arrach

Published in International Journal of Agricultural Economics (Volume 4, Issue 5)

Received: 27 September 2019 Accepted: 15 October 2019 Published: 24 October 2019

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Abstract

Our main aim was to analyze of the various types of contractual clauses framework of Agricultural Aggregation Projects (AAP) in the cereal sector in Morocco. We used the data from the content of the contracts and by individual interviews with key actors complicated in the process of implementation of the aggregation projects of cereals. The results reveal that only eight Agricultural Aggregation Project, out of 119, received the certificate of aggregation. This is reflecting the fact that, the implementation of this model of vertical coordination was underway. In addition, the analysis of the contract-farming data for clauses has shown us 5 important clauses categories: production (quantity and quality) and payment methods; agricultural extension systems; inputs supply; management of risks; and dispute resolution mechanisms. These findings highlight the value added to the contractual clauses and the need to strengthen the visibility and role of the contract farming as a framework to accompany the investments of ‘‘The Green Morocco Plan’’, in particular with regard to agricultural aggregation projects. We also show that the contract participation reduces the transaction costs in aggregation system, reduction in the number of intermediaries and ensure the link between the producers and markets. The study concludes that, despite enactment of laws on farm aggregation, contract smallholders remain vulnerable to opportunist behavior. It suggests that the contract clauses must be accompanied by commensurate controls and Involving farmers in negotiating contract terms to ensure ‘win-win’ outcomes for Aggregator (AG) and Aggregated (Ag).

Published in	International Journal of Agricultural Economics (Volume 4, Issue 5)
DOI	10.11648/j.ijae.20190405.17
Page(s)	245-253
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2019. Published by Science Publishing Group

Keywords

Cereal Aggregation Project, Transaction Costs, Contractual Clauses, Contract Farming, Vertical Coordination

References

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APA Style

Bouichou El Houssain, Aziz Fadlaoui, Khalil Allali, Radouan Arrach. (2019). Contract Farming in the Morocco Cereal Sector: Contract Clauses, Ambiguity, and Opportunism. International Journal of Agricultural Economics, 4(5), 245-253. https://doi.org/10.11648/j.ijae.20190405.17

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ACS Style

Bouichou El Houssain; Aziz Fadlaoui; Khalil Allali; Radouan Arrach. Contract Farming in the Morocco Cereal Sector: Contract Clauses, Ambiguity, and Opportunism. Int. J. Agric. Econ. 2019, 4(5), 245-253. doi: 10.11648/j.ijae.20190405.17

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AMA Style

Bouichou El Houssain, Aziz Fadlaoui, Khalil Allali, Radouan Arrach. Contract Farming in the Morocco Cereal Sector: Contract Clauses, Ambiguity, and Opportunism. Int J Agric Econ. 2019;4(5):245-253. doi: 10.11648/j.ijae.20190405.17

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@article{10.11648/j.ijae.20190405.17,
  author = {Bouichou El Houssain and Aziz Fadlaoui and Khalil Allali and Radouan Arrach},
  title = {Contract Farming in the Morocco Cereal Sector: Contract Clauses, Ambiguity, and Opportunism},
  journal = {International Journal of Agricultural Economics},
  volume = {4},
  number = {5},
  pages = {245-253},
  doi = {10.11648/j.ijae.20190405.17},
  url = {https://doi.org/10.11648/j.ijae.20190405.17},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijae.20190405.17},
  abstract = {Our main aim was to analyze of the various types of contractual clauses framework of Agricultural Aggregation Projects (AAP) in the cereal sector in Morocco. We used the data from the content of the contracts and by individual interviews with key actors complicated in the process of implementation of the aggregation projects of cereals. The results reveal that only eight Agricultural Aggregation Project, out of 119, received the certificate of aggregation. This is reflecting the fact that, the implementation of this model of vertical coordination was underway. In addition, the analysis of the contract-farming data for clauses has shown us 5 important clauses categories: production (quantity and quality) and payment methods; agricultural extension systems; inputs supply; management of risks; and dispute resolution mechanisms. These findings highlight the value added to the contractual clauses and the need to strengthen the visibility and role of the contract farming as a framework to accompany the investments of ‘‘The Green Morocco Plan’’, in particular with regard to agricultural aggregation projects. We also show that the contract participation reduces the transaction costs in aggregation system, reduction in the number of intermediaries and ensure the link between the producers and markets. The study concludes that, despite enactment of laws on farm aggregation, contract smallholders remain vulnerable to opportunist behavior. It suggests that the contract clauses must be accompanied by commensurate controls and Involving farmers in negotiating contract terms to ensure ‘win-win’ outcomes for Aggregator (AG) and Aggregated (Ag).},
 year = {2019}
}

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TY  - JOUR
T1  - Contract Farming in the Morocco Cereal Sector: Contract Clauses, Ambiguity, and Opportunism
AU  - Bouichou El Houssain
AU  - Aziz Fadlaoui
AU  - Khalil Allali
AU  - Radouan Arrach
Y1  - 2019/10/24
PY  - 2019
N1  - https://doi.org/10.11648/j.ijae.20190405.17
DO  - 10.11648/j.ijae.20190405.17
T2  - International Journal of Agricultural Economics
JF  - International Journal of Agricultural Economics
JO  - International Journal of Agricultural Economics
SP  - 245
EP  - 253
PB  - Science Publishing Group
SN  - 2575-3843
UR  - https://doi.org/10.11648/j.ijae.20190405.17
AB  - Our main aim was to analyze of the various types of contractual clauses framework of Agricultural Aggregation Projects (AAP) in the cereal sector in Morocco. We used the data from the content of the contracts and by individual interviews with key actors complicated in the process of implementation of the aggregation projects of cereals. The results reveal that only eight Agricultural Aggregation Project, out of 119, received the certificate of aggregation. This is reflecting the fact that, the implementation of this model of vertical coordination was underway. In addition, the analysis of the contract-farming data for clauses has shown us 5 important clauses categories: production (quantity and quality) and payment methods; agricultural extension systems; inputs supply; management of risks; and dispute resolution mechanisms. These findings highlight the value added to the contractual clauses and the need to strengthen the visibility and role of the contract farming as a framework to accompany the investments of ‘‘The Green Morocco Plan’’, in particular with regard to agricultural aggregation projects. We also show that the contract participation reduces the transaction costs in aggregation system, reduction in the number of intermediaries and ensure the link between the producers and markets. The study concludes that, despite enactment of laws on farm aggregation, contract smallholders remain vulnerable to opportunist behavior. It suggests that the contract clauses must be accompanied by commensurate controls and Involving farmers in negotiating contract terms to ensure ‘win-win’ outcomes for Aggregator (AG) and Aggregated (Ag).
VL  - 4
IS  - 5
ER  -

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Author Information

Bouichou El Houssain

Regional Agricultural Research Center, National Institute for Agricultural Research (INRA), Meknes, Morocco
Aziz Fadlaoui

Regional Agricultural Research Center, National Institute for Agricultural Research (INRA), Meknes, Morocco
Khalil Allali

Department of Economic and Social Sciences Applied to Agriculture, Agronomic and Veterinary Institute Hassan II, Rabat, Morocco
Radouan Arrach

Strategy and Statistics Directorate, Ministry of Agriculture, Fisheries, Rural Development, Water and Forests, Rabat, Morocco

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APA Style

Bouichou El Houssain, Aziz Fadlaoui, Khalil Allali, Radouan Arrach. (2019). Contract Farming in the Morocco Cereal Sector: Contract Clauses, Ambiguity, and Opportunism. International Journal of Agricultural Economics, 4(5), 245-253. https://doi.org/10.11648/j.ijae.20190405.17

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ACS Style

Bouichou El Houssain; Aziz Fadlaoui; Khalil Allali; Radouan Arrach. Contract Farming in the Morocco Cereal Sector: Contract Clauses, Ambiguity, and Opportunism. Int. J. Agric. Econ. 2019, 4(5), 245-253. doi: 10.11648/j.ijae.20190405.17

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AMA Style

Bouichou El Houssain, Aziz Fadlaoui, Khalil Allali, Radouan Arrach. Contract Farming in the Morocco Cereal Sector: Contract Clauses, Ambiguity, and Opportunism. Int J Agric Econ. 2019;4(5):245-253. doi: 10.11648/j.ijae.20190405.17

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@article{10.11648/j.ijae.20190405.17,
  author = {Bouichou El Houssain and Aziz Fadlaoui and Khalil Allali and Radouan Arrach},
  title = {Contract Farming in the Morocco Cereal Sector: Contract Clauses, Ambiguity, and Opportunism},
  journal = {International Journal of Agricultural Economics},
  volume = {4},
  number = {5},
  pages = {245-253},
  doi = {10.11648/j.ijae.20190405.17},
  url = {https://doi.org/10.11648/j.ijae.20190405.17},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijae.20190405.17},
  abstract = {Our main aim was to analyze of the various types of contractual clauses framework of Agricultural Aggregation Projects (AAP) in the cereal sector in Morocco. We used the data from the content of the contracts and by individual interviews with key actors complicated in the process of implementation of the aggregation projects of cereals. The results reveal that only eight Agricultural Aggregation Project, out of 119, received the certificate of aggregation. This is reflecting the fact that, the implementation of this model of vertical coordination was underway. In addition, the analysis of the contract-farming data for clauses has shown us 5 important clauses categories: production (quantity and quality) and payment methods; agricultural extension systems; inputs supply; management of risks; and dispute resolution mechanisms. These findings highlight the value added to the contractual clauses and the need to strengthen the visibility and role of the contract farming as a framework to accompany the investments of ‘‘The Green Morocco Plan’’, in particular with regard to agricultural aggregation projects. We also show that the contract participation reduces the transaction costs in aggregation system, reduction in the number of intermediaries and ensure the link between the producers and markets. The study concludes that, despite enactment of laws on farm aggregation, contract smallholders remain vulnerable to opportunist behavior. It suggests that the contract clauses must be accompanied by commensurate controls and Involving farmers in negotiating contract terms to ensure ‘win-win’ outcomes for Aggregator (AG) and Aggregated (Ag).},
 year = {2019}
}

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TY  - JOUR
T1  - Contract Farming in the Morocco Cereal Sector: Contract Clauses, Ambiguity, and Opportunism
AU  - Bouichou El Houssain
AU  - Aziz Fadlaoui
AU  - Khalil Allali
AU  - Radouan Arrach
Y1  - 2019/10/24
PY  - 2019
N1  - https://doi.org/10.11648/j.ijae.20190405.17
DO  - 10.11648/j.ijae.20190405.17
T2  - International Journal of Agricultural Economics
JF  - International Journal of Agricultural Economics
JO  - International Journal of Agricultural Economics
SP  - 245
EP  - 253
PB  - Science Publishing Group
SN  - 2575-3843
UR  - https://doi.org/10.11648/j.ijae.20190405.17
AB  - Our main aim was to analyze of the various types of contractual clauses framework of Agricultural Aggregation Projects (AAP) in the cereal sector in Morocco. We used the data from the content of the contracts and by individual interviews with key actors complicated in the process of implementation of the aggregation projects of cereals. The results reveal that only eight Agricultural Aggregation Project, out of 119, received the certificate of aggregation. This is reflecting the fact that, the implementation of this model of vertical coordination was underway. In addition, the analysis of the contract-farming data for clauses has shown us 5 important clauses categories: production (quantity and quality) and payment methods; agricultural extension systems; inputs supply; management of risks; and dispute resolution mechanisms. These findings highlight the value added to the contractual clauses and the need to strengthen the visibility and role of the contract farming as a framework to accompany the investments of ‘‘The Green Morocco Plan’’, in particular with regard to agricultural aggregation projects. We also show that the contract participation reduces the transaction costs in aggregation system, reduction in the number of intermediaries and ensure the link between the producers and markets. The study concludes that, despite enactment of laws on farm aggregation, contract smallholders remain vulnerable to opportunist behavior. It suggests that the contract clauses must be accompanied by commensurate controls and Involving farmers in negotiating contract terms to ensure ‘win-win’ outcomes for Aggregator (AG) and Aggregated (Ag).
VL  - 4
IS  - 5
ER  -

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