CP maize contract farming in Shan State, Myanmar: A regional case of a place-based corporate agro-feed system

TitleCP maize contract farming in Shan State, Myanmar: A regional case of a place-based corporate agro-feed system
Annotated RecordAnnotated
Year of Publication2015
AuthorsWoods K
Paginationi-iv, 1-27
Key themesAgriculturalModernization, Dispossession-grabbing, FDI, MarginalisedPeople
Abstract

The Bangkok-based Sino-Thai company Choern Pakard Group (CP Group), Asia's largest and most prominent agro-food/feed corporation, has led an industrial maize contract farming scheme with (ex-)poppy upland smallholders in Shan State, northern Myanmar to supply China’s chicken-feed market. Thailand, as a Middle-Income Country (MIC) and regional powerhouse, has long-tapped China’s phenomenal economic growth and undersupplied consumer demand. The study presented demonstrates how changes in multi-scalar political economies and subsequent agro-food/feed systems creates concomitant effects on rural smallholder producers linked into the globalising of production-supply chains. Thailand’s agribusiness sector ‘going out’ aimed to reduce domestic input production costs, supported through neoliberal regional investment and trade policies and crafted behind closed doors by CP executives. Since then, the ethnic minority-populated uplands of Shan State have become a major CP maize production zone for China’s market. This has triggered a historically significant agrarian transformation in Shan State, from low-input subsistence economies to cash cropping of high-input, company-owned seeds for export to foreign markets. The CP maize smallholder production scheme tends to trigger differential socio-economic outcomes and redistribution of wealth within the village. The differential dispossessory outcomes is shaped by differences in village-level household capital, lack of smallholder access to affordable rural finance, ethnic Chinese migrations, and (il)licit border economies tied to Cold War-era politics. The particularity of places, such as differences in their political history, migrations, agro-ecology, geography, and relationship to the opium economy, also influences the dynamics of village- and household-level differentiation of wealth due to CP maize cultivation in Shan State. This paper therefore showcases, through empirical village-level field research, how the corporatisation and regional-/globalisation of the chicken feed market has radically transformed agrarian relations and structures of debt and dispossession in rural, upland Shan State.
URLhttps://www.tni.org/files/download/bicas_working_paper_14_woods.pdf
Availability

Available for download
Countries

Myanmar, Thailand
Document Type

Working Paper

Annotations

Overall relevance: 

This research aims to shed light on the effect of agro-food industry through foreign direct investment on maize contract farming across borders between China, Myanmar and Thailand. It illustrates political and economic transitions relating to land conversion and the land dispossession of smallholders in Shan State, Myanmar. Furthermore, the research contributes to commodity chain research in looking at how brokers play a key role in differentiating farmers through uneven capital and ethnic relations in different geographical settings. The paper touches on multiple conceptual frameworks, ranging from agrarian transformation, political ecology, historization, political economy, commodity chains, cross-border economies, and economic reterritorialization

Key Themes: 
  • Land dispossession/land grabbing - Under the new Myanmar land law that aims to utilise wasteland or vacant land for commercial proposes, the private sector sees the opportunity to persuade small holders to sell or transfer their ownership of land to investors. Then their land was turned from subsistent into flexible crop farming to serve the global demand. The investment was propagandized to replace opium production associated with the Shan State since the cold-war era. Smallholders were at risk of losing their land to those with greater capital
  • Agricultural modernisation: key ideas and debates relevant to land tenure security - Farmers changed from growing multiple crops for household consumption to mono-cropping, resulting in lower outputs of subsistent crops and insufficient household consumption during the annual cycle. The research shows the arrival of flexible crop used for different purposes, whether for human consumption, animal feed, or fuel production. The new technique of farming was oriented towards industrialized practices. Meanwhile, land intensification and chemical usage has led to soil infertility. The role of contract farming subsequently resulted in the improvement of infrastructure, with road construction facilitating the delivery of the produce to the demand destination. Meanwhile, farmers’ livelihoods gradually changed and adapted to modern life, embracing aspects of material culture such as televisions, cars, and mobile phones
  • FDI and land access: economic land concessions, contract farming, short term and long term renting - Foreign investment from Thailand encouraged small farmers, through contract farming, to serve the demand of China’s animal feed sector. This investment also plays a key role in the commodity chain, where food is produced and distributed from local to the transnational level. The role of the non-state armed group is crucial in directing the village’s development trajectories, influencing land conversion, and supporting global food production
  • Marginalized people's land rights and access: ethnic minorities, poor and women - Smallholders were tricked into unfavourable contracts through the attraction of subsidies during the early stages of production. This resulted in debt longer term, with dependency to spend credit on seeds and fertilizers from the brokers. Access to certain resources such as water were also affected by such schemes. New divisions of social status emerged in the wealth between land owners, the landless and farm labourers
Research basis: 

This research was conducted through interviewing key informants, and conducting field research in eight villages in the Northern and Southern Shan State. It illustrates specific case studies in different locations to nuance the history and economy of each village. (Provided by Busarin Lertchavalitsakul)