Research on Basic Structural Characteristics on Contract Farms and Some Factors Affecting Production Pattern - Processing Tomato Production as a Case Study

M. Emin ERGUN

SUMMARY

With this study; general information has been given on contracting farming, present situation of the system both in the world and Turkey and problems have been discussed. As an example, contracting and non-contracting farms were compared in Yenişehir, county of Bursa province. Totally 115 farms of which 78 were contracting and 37 non-contracting have been interviewed. Differences of farm owners of two groups were determined from the socio-economics point of view. Farm structures were studied, differences were pointed out and performances of farms within two groups were analysed.

One of the important differences between two groups is that high percentage of non farm income is in the second group.

The average cultivated farm land is 104.78 decar for contracting farms while 52.49 decar for the second group. According to the farmers, some disadvantages of contracting farm are inflexibility of contracting terms and delayed payments by processors. The most important advantage of this system is the availability of ready and confident buyers. 25.31 % of the value of the crop production comes from processing tomatoes in the first group while sugar beet value (22.6 %) in the second range. In the second group, however sugar beet is the first with 26.93 % share and green pepper is the following crop with the share of 24.14 %. Land value is the biggest part in the total capital which reaches up to 85 %. Net Assets are 76.47 and 82.09 % for the groups respectively. That is, farming is mostly based on Net Assets. The Gross Production Value is 1.37 million Turkish liras (TL.) per decar for contracting farm, while this is 1.21 million TL. for the second group. The economics rantability for the groups was calculated as 2.78 % and 0.83 % respectively. So it means that profitability of the farms is very low.