During the past two decades, food assistance policy has shifted toward local or regional food purchases and away from purchases from donor countries. While most local and regional procurement occurs through hard tendering processes open to large‐scale firms and farms, there is growing interest in identifying how and whether to procure from smallholder farmer organizations. To date, little is known about the drivers of successful contracting with farmers’ organizations (FOs). We utilize data from the United Nations World Food Programme Purchase for Progress pilot in three East African countries to predict defaults on contracts. We examine four possible explanations: country contexts, FO characteristics, prior experience with contracts, and contract modalities and their relationship to local spot market prices. The single most important predictor of default is the increase in market prices between contract approval and delivery. Yet, while increases in market prices are linked to increases in default, this relationship is decreasing in contract size, indicating search costs associated with breaking contracts. Our findings yield both generalizable and context‐specific insights about whether – and when – procuring from smallholder farmers can be successfully integrated into the food assistance toolkit. This article is protected by copyright. All rights reserved