1. Negotiating Contract Farming in the Dominican Republic By Laura T. Raynolds

2. Objectives  Raynolds examines political economic conditions that gave rise to contract farming in the Dominican Republic  Context of changing production & marketing conditions  The state plays a critical role in mediating contract relations between unequal parties  Global restructuring privileges flexible accumulation

3. Contract farming  In Latin America & the Caribbean peasant producers are growing non-traditional fruits & vegetables under contract for processing & export firms  Contract farming is likely to expand because of the global increase in luxury & processed-food markets & the widespread adoption of export promotion policies  Contract farming is unique because it commits household land & labor resources to the production of a commodity that is ultimately controlled by an agroindustrial firm

4. Nontraditional Agriculture and Contract Farming in the Dominican Republic  Over the past 20 years agriculture in the Dominican Republic has been restructured by globalization, international debt, & neoliberalism  The rise of nontraditional agriculture in the Dominican Republic has been associated with a dramatic increase in contract farming  The Dominican State has encouraged contract farming in nontraditional agriculture as a way to organize the peasant community & reduce its obligations

5.  Given declining markets for traditional crops (sugar cane), contracts for non- traditional crops ensure access to inputs & markets  The state restricts imports & shelters the domestic tomato market  The state fixes consumer prices in negotiation with the industry  The state thus privatizes public services to farmers  Many farmers can not read contracts  Contracts are a form of disguised wage labor

6. Contracts Provide: Contracts Provide: 1. Processing firms with access to state irrigated land & peasant household labor 2. Firms get tax examptions, low-interest loans 3. Peasant growers with credit & guaranteed markets 4. A formal agreement to buy farm output in return for a guaranteed market (re: Faustian Bargain) 5. Are a form of disguised wage labor

7. Debates  Some suggest that contract farming represents a form of “disguised wage labor” where production is essentially controlled by the purchasing firm & producers are basically proletarian workers  Others argue that the control over production rests largely with the growers, who are essentially independent family farmers engaging in a form of advance market agreement  The author believes we need to research how contract relations are negotiated & renegotiated by growers & firms within the context of shifting production & market conditions

8. Tomato-Processing Firms’ Negotiation of Production Contracts  The industry is controlled by 5 Dominican- owned corporations--the largest firms in the nontraditional agricultural sector  90% of tomatoes grown by 6500 small-scale growers  Why contract farming of tomatoes?  Tomatoes are a labor-intensive crop  Managers recognize the importance of unpaid household labor  Responsibility for assembling labor & assuring work performance is shifted from the firm to the growers

9. Contract Growers  When asked to explain the position of contract growers, company managers & field supervisors respond “the contract growers are not farmers”  “We produce tomatoes on their land & they sell them to us. They are like tourists on their own land”  If contract growers are not farmers, what are they?  Most growers have resident female partners & typically three or four children  Households are poor, ½ can’t afford 3 meals a day  Why do contract farming?  They have not other source of credit for inputs  Free household labor allows them to use credit for purchase of food

10.  “We all work in the tomatoes, that way the money stays here. The little ones are good at transplanting, my wife knows the harvest, I do the rest. We are poor and cannot afford to hire others, except in the harvest-you have to hire others for that”

11. Contracting in the Face of Production Losses  In the early 1980s, Dominican production of processing tomatoes was relatively stable  In the mid 1980s the processing firms introduced a set of new procedures aimed at tightening their control over production  Costs exceeded returns & left farmers in debt  Companies escalated the volume of pesticide use, fueled a white fly outbreak which caused huge agricultural losses  They moved to other regions to repeat the same problems Trialeurodes vaporariorum

12. The companies annuled their contracts with farmers  Farmer: “The companies took everything and I got nothing. The company eats the farmer”