Contract Farming was introduced by The Botswana Agricultural Marketing Board (BAMB) which was established by an Act of Parliament, No. 2 of 1974 tasked to provide a market for locally grown crops, and ensure that adequate supplies exist for sale to consumers at affordable prices. The Contract Farming Scheme, a Botswana BAMB initiative, identifies a market for a particular crop, contracts farmers to produce and supply BAMB with crops at agreed prices and quantities prior to planting. Crops included are Sorghum, Maize, Cowpeas and Beans.
Contract farming helps to assure farmers that their crop is sold, before they even plant, to minimize farmers’ exposure to price risks due to possible price fluctuations, and thus empower local farmers to commercialize their operations without fear. This facility is open to any farmer who produces 10 Mt or more per crop within Botswana.
Benefits of Contract Farming
•100% guarantee to farmer on a minimum price for the product. In times when the buying prices drop during a harvest season, the farmer’s income is secured as his price is pre agreed.
•Farmer can confidently budget and plan operations well ahead.
•Farmer is paid on delivery, the contracted price, within 7 days. This give confidence.
BAMB provides market trends information to the farming community, ahead of planting, to better help them plan their crop rotations and production levels. This typically includes market opportunities in the grain industry, demand and price projections. Market information helps farmers to confidently seek financial support for required inputs for a given season from lending institutions.
Storage facility is available for use by producers and millers at a nominal fee. The BAMB storage capacity is over 132,000 Metric tons, with BAMB handling on average 25-35,000 Metric of scheduled produce, 73 % of which is Sorghum.
Strategic Grain Reserves
BAMB has managed the Botswana Government’s strategic Grain Reserve (SGR) for national food security for more than twenty years. The government has increased SGR from 10,000 Mt of Sorghum to 70,000 Mt, made up of 30,000 Mt of Sorghum, 30,000 Mt of Maize and 10,000 Mt beans. This is sourced from local farmers and gives them added confidence in their ventures.
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