Drivers of Participation in Smallholders Banana Contract Farming in Kenya.

Abstract

Smallholder banana farmers in Kenya face declining farm productivity and low market prices due to a fragmented, broker-dominated market. While the Kenya National Banana Development Strategy promotes contract farming as a potential solution, farmer participation remains surprisingly low. This study investigates the factors influencing smallholder participation in banana contract farming in Kenya. Employing a heteroskedastic probit model with robust standard errors to assess the drivers of participation in smallholder banana contract farming in Kenya, we identify key drivers such as household head education, credit access, cooperative membership, irrigation, and banana farm size. Based on these findings, we recommend policy interventions focusing on:  Enhanced farmer extension services and technical assistance, facilitated credit access, cooperative development, investment in irrigation, and incentives for contract farming companies. By addressing these critical factors, policymakers can encourage wider smallholder participation in banana contract farming, unlocking its potential to improve livelihoods and contribute to sustainable agricultural development in Kenya.