Outgrower Models and the Modernisation of Agriculture: The Case of Blue Skies Company Limited in the Akwapim South Municipality

Abstract

The study assessed the outgrower model as a tool for agricultural modernization in Ghana. It further attempts to examine the effects of agricultural modernization on output, and identify the livelihood outcomes of the model on the farmers involved in the scheme as well as their communities. Over the years, the impacts of the outgrower schemes on integrating smallholder farmers into the agro processing continuum has been a subject of argument between two main schools of thought. One school of thought argues that, the impact of the scheme on the farmers has been positive. The other school of thought sees it as an exploitative mechanism adopted by multi-national companies to exploit small holder farmers. Such disagreement is what necessitated the need for the study. Primary data were collected from 42 contract farmers, 20 non-contract farmers and 2 key informants, using questionnaire survey and in-depth interviews. The findings suggest that the involvement of the contract farmers in this scheme had significantly increased their skills and knowledge in modern agricultural practices. Furthermore, a ready market in place for farmers contracted by the company caused a significant increase in their output hence influencing their livelihoods and communities positively. The study thus recommends that, in order to facilitate agricultural modernization, government should revisit tax incentives. This is aimed at encouraging investors to invest in the manufacturing sector, thus serving as a source of ready market for farm produce. Government should also develop a comprehensive agricultural modernization strategy (AMS) and industry development strategy (AMIS) for the country at the regional and district levels.