Double-hurdle in adoption of dairy cattle contract farming among small-scale farmers in Mbeya, Tanzania

Aim: Understanding the market dynamics of dairy cattle farming in Tanzania is vital for fostering a competitive and sustainable dairy industry. Contract farming is a prominent market structure in this realm, offering small-scale farmers improved breeds, veterinary services, feed, and extension support. However, the engagement of small-scale farmers in dairy cattle contract farming is currently limited. Encouraging its uptake requires a thorough understanding of the driving forces and impediments. Previous studies investigating the factors influencing the adoption of dairy cattle contract farming have overlooked the correlation between the liquidity constraints of vaccination and the barriers to its adoption. This study addresses this gap. Methods: The study analyzed data gathered using a structured questionnaire from 300 randomly selected small-scale dairy cattle farmers in the Mbeya Region and employed a double-probit model to correct sample selection biases. Results: The research uncovered that the adoption of dairy cattle contract farming by small-scale farmers is influenced by household size, risk aversion, access to extension services, radio ownership, quantity of dairy cattle owned, type of dairy cattle breed, liquidity constraints of vaccination, utilization of artificial insemination, and the application of veterinary treatment. Conclusions: The study emphasizes the efforts toward implementing initiatives that streamline farmers’ access to superior dairy cattle breeds, vaccination, veterinary treatment, and artificial insemination services.