An Empirical Investigation on Contract Farming of Medicinal plants and its impact on farmers in Kerala

The Model Contract Farming Act,2018 is a revolutionary step which promises a win-win situation for both farmers and ayurvedic firms. By entering into contract farming agreement, the farmers ensure to cultivate medicinal plants according to the specified quantity and quality standards stipulated by the ayurvedic firms. The ayurvedic firms will get supplies of cultivated material of uniform quality, which is otherwise difficult in case of medicinal plants collected from the forest. In return, farmers receive a fixed remuneration from the company at the time of delivery. It provides an assured market at a pre-agreed priceand also promote sustainable development for rural farmers. The present paper analyses the result of farmer’s perception towards contract farming. The Census method was used to collect data, and population size is 196 farmers. Data was collected from medicinal plant farmers in Thrissur, Malappuram, Palakkad, Wayanad and Ernakulam districts of Kerala through a structured questionnaire. Using Statistical Package for Social Sciences various relevant test was administered like Factor analysis and Multiple regression test. Based on the reliability test the minimum value of Co-efficient alpha (Cronbach’s Alpha) obtained was .862