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The Brazilian National Program for Production and Use of Biodiesel (PNPB in Portuguese) has created a huge demand for biodiesel in Brazil. The PNPB is strongly based on social development through the inclusion of family farmers in projects integrated with biodiesel power plants. Among the various oilseeds, castor bean (Ricinus communis L.) was identified as the ideal one to promote social development in the semi-arid region. However, although promising, the mechanisms of the federal program are still insufficient to promote the effective participation of family farmers. This research shows that companies are facing huge problems in implementing contracts with family farmers. It describes and analyzes the functioning dynamics of this agro-production chain. This paper addresses the identification and the discussion of these obstacles, in order to increase the competitiveness of the biodiesel agribusiness chain, based on castor oil social projects in Brazil. (C) 2010 Elsevier Ltd. All rights reserved.