Contract Farming in Agricultural Supply Chains in Morocco: Effects on Performance, Coordination, and Sustainability of Agricultural Suppliers’ Production Systems

Abstract

The Moroccan agricultural sector has undergone profound structural transformation over the past two decades, driven by the Green Morocco Plan and its successor Generation Green 2020–2030. At the heart of this transformation lies contracting, a governance mechanism regulating relationships among the various actors within agricultural supply chains. This article examines how contractual arrangements shape vertical coordination between farmers, aggregators, agri-food processors and distributors, and how they constitute a key managerial lever for value creation and distribution. Drawing on a theoretical framework combining transaction cost theory (Williamson, 1985), agency theory (Jensen and Meckling, 1976) and the resource-based view (Barney, 1991), and building on a qualitative analysis of Moroccan cases from the olive, citrus and vegetable sectors, this article identifies dominant contract forms, their adoption determinants, and the tensions and failures that limit their effectiveness. Results show that while contracting improves coordination, reduces uncertainty and facilitates access to finance, its deployment is hampered by persistent information asymmetries, weak institutional environments and power imbalances to the detriment of smallholder farmers. Managerial and policy recommendations are proposed to strengthen equity and sustainability in Moroccan agricultural value chains.