Professional Documents
Culture Documents
Problems and Prospects of Agricultural Marketing in India - An Overview PDF
Problems and Prospects of Agricultural Marketing in India - An Overview PDF
Problems and Prospects of Agricultural Marketing in India - An Overview PDF
com
ISSN 2249-8516
Review Article
PROBLEMS AND PROSPECTS OF AGRICULTURAL MARKETING IN
INDIA: AN OVERVIEW
A. Vadivelu1 and B.R. Kiran2
1
Research and Teaching Assistant in Economics, D.D.E., Kuvempu University Shankaraghatta – 577 451, India.
2
Research and Teaching Assistant in Environmental Science, D.D.E., Kuvempu University Shankaraghatta – 577 451,
India.
Received 15 August 2013; accepted 30 August 2013
Abstract
Agriculture is different from industry and plays a significant role in the economic development of a nation. India‟s
prosperity depends upon the agricultural prosperity. There are many kinds of agricultural products produced in India and
the marketing of all these farm products generally tends to be a complex process. Agricultural marketing involves many
operations and processes through which the food and raw materials move from the cultivated farm to the final consumers.
Agriculture provides goods for consumption and exports and manufacturing sectors. The suitable marketing system should
be designed so as to give proper reward or return to the efforts of the tiller of the soil. Market information is a means of
increasing the efficiency of marketing system and promoting improved price formation. It is crucial to the farmers to make
informed decisions about what to grow, when to harvest, to which market produce should be sent and whether or not to
store it. Awareness of farmers on different components of market information and its utility was very poor (11 to 37 %) as
compared to that of traders (75%). Out of the expectations of farmers on grades, quality, prices in potential markets, price
projections; only real time arrivals and prices were documented and disseminated with traditional approach. Hence there is
a need to create awareness among the farmers through the agricultural extension agencies like the State Department of
Agriculture, Krishi Vigyan Kendras so that the marketing information on agriculture commodities are incorporated in the
extension services along with production aspects to the farmers.
© 2013 Universal Research Publications. All rights reserved
Key words - Agriculture, Cultivation, Marketing, food-grains, commercial-crops
INTRODUCTION Marketing has to be customer-oriented and has to provide
Agricultural marketing covers the services involved in the farmer, transporter, trader, processor, etc. with a profit.
moving an agricultural product from the farm to the This requires those involved in marketing chains to
consumer. Numerous interconnected activities are involved understand buyer requirements, both in terms of product
in doing this, such as planning production, growing and business conditions.
and harvesting, grading, packing, transport, storage, agro- In Western countries considerable agricultural marketing
and food processing, distribution advertising and sale. support to farmers is often provided. In the USA, for
Some definitions would even include “the acts of buying example, the USDA operates the Agricultural Marketing
supplies, renting equipment, (and) paying labor", arguing Service. Support to developing countries with agricultural
that marketing is everything a business does. Such marketing development is carried out by various donor
activities cannot take place without the exchange of organizations and there is a trend for countries to develop
information and are often heavily dependent on the their own Agricultural Marketing or Agribusiness
availability of suitable finance (Penn State College of units, often attached to ministries of agriculture.
Agricultural Sciences -Agricultural Marketing, 2012) Activities include market information development,
Marketing systems are dynamic; they are competitive and marketing extension, training in marketing and
involve continuous change and improvement. Businesses infrastructure development. Since the 1990s trends have
that have lower costs, are more efficient, and can deliver seen the growing importance of supermarkets and a
quality products, are those that prosper. Those that have growing interest in contract farming, both of which impact
high costs, fail to adapt to changes in market demand and significantly on the way in which marketing takes place.
provide poorer quality is often forced out of business. In India, there are network of cooperatives at the local,
Rapeseed
4699.9 5659.9 5790.0 4190.0 5082.6 3879.8 6291.4 7593.1 8131.2 7437.8 5833.6 7200.7 6608.1 8178.7 6603.7
& Mustard
Linseed 240.0 270.0 240.0 200.0 209.1 176.7 196.5 169.7 172.5 167.9 163.4 169.2 153.7 146.5 152.5
safflower 120.0 240.0 260.0 200.0 220.6 178.5 134.9 173.6 228.6 240.3 224.5 189.2 178.8 150.4 145.3
Sunflower 889.6 950.1 690.1 649.9 679.5 872.6 930.4 1186.7 1439.0 1227.5 1463.1 1158.0 850.7 651.1 516.7
soyabean 6460.0 7140.0 7080.0 5280.0 5962.0 4654.7 7818.9 6876.3 8273.5 8850.8 10968.2 9905.4 9964.5 12736.4 12213.5
Edible
20249.8 23639.6 19700.3 17359.9 19800.6 14234.2 24193.1 23390.4 26814.7 23359.2 28538.3 26378.7 23719.0 30982.1 27351.3
oilseed
Non edible
1070.0 1110.3 1010.0 1080.0 861.7 604.2 993.2 963.1 1163.2 930.2 1217.0 1340.2 1162.7 1496.9 2447.4
Oilseed
Total
21319.8 24749.9 20710.3 18439.9 20662.3 14838.4 25186.3 24353.5 27977.9 24289.4 29755.3 27719.0 24881.6 32479.0 29798.7
Oilsedds
Cotton 10850.0 12290.0 1153.0 9520.0 9997.0 8623.7 13729.0 16428.6 18499.0 22631.8 25884.1 22276.2 24021.8 33000.0 35200.0
Jute 9960.0 8840.0 9420.0 9320.0 10583.0 10273.7 10251.6 9399.3 9969.5 10317.1 10220.1 9634.4 11230.4 10009.4 10735.6
Mesta 1060.0 970.0 1130.0 1240.0 1094.4 1001.7 921.3 873.0 870.1 955.9 990.4 730.9 587.0 610.8 663.0
Sugarcane 279540.0 288720.0 299320.0 295960.0 297207.8 287383.2 233861.8 237088.4 281171.8 355519.7 348187.9 285029.3 292301.6 342381.6 361036.6
Source: Government of India- „State of Indian Agriculture 2012-13’, Ministry of Agriculture, Department of Agriculture and Co-operation, New Delhi.
Rapeseed
668 869 961 936 1002 854 1159 1038 1117 1095 1001 1143 1183 1185 1121
& Mustard
Linseed 302 360 405 345 390 393 412 378 395 385 349 415 449 408 473
safflower 194 545 593 471 546 483 371 470 627 637 701 642 621 617 580
Sunflower 510 521 536 605 577 531 464 549 615 567 765 639 576 701 706
soyabean 1079 1100 1138 823 940 762 1193 908 1073 1063 1235 1041 1024 1327 1208
Edible
821 954 861 822 926 696 1077 888 1010 918 1122 1004 953 1192 1116
oilseed
Non edible
746 775 735 651 688 585 832 808 894 874 970 1052 1080 1208 1365
Oilseed
Total
817 945 854 810 913 691 1064 885 1004 916 1115 1006 958 1193 1133
Oilsedds
Cotton 208 224 225 190 186 191 307 318 362 421 467 403 403 499 491
Jute 1978 1876 2003 2026 2182 2139 2173 2186 2362 2342 2260 2207 2492 2329 2389
Mesta 952 986 1078 1177 1131 1056 1087 1108 1136 1210 1219 1141 1121 1115 1245
Sugarcane 71133 71203 70934 68578 67370 63576 59380 64752 66919 69022 68877 64553 70020 70091 71667
Source: Government of India- „State of Indian Agriculture 2012-13’, Ministry of Agriculture, Department of Agriculture and Co-operation, New Delhi.
needs of farmers. To ensure deeper penetration in rural (DSS) in forecasting of oilseeds scenario in India through a
India the application was designed to be made available system dynamic model. They observed that the oilseeds
online, accessible through kiosks or tele-centers in villages scenario is rapidly changing, the forecasting needs a
or via telephones. dynamic approach to account for the complex nature of the
Kiresur et al. (2001) explored the Decision support systems agricultural sector and it‟s backward and forward linkages
International Journal of Agricultural and Food Science 2013, 3(3): 108-118
113
with other sectors of the economy. The system dynamic operation in the Union Ministry of Agriculture sanctioned a
approach was found to fill the gap. System dynamics central sector scheme to NICNET to link 810 nodes
method is a computer aided structural modeling technique through its attached office, DMI during 2000-02.
in which time varying effects can be explicitly considered. Gunatilke (2003) reported that the private sector played a
The DSS projected demand – supply gap of about two major role in production and marketing in Sri Lanka while
million tonnes of edible oil by 2010 AD. The simulated the State sector played a supportive role in facilitating them
scenario forecasted demand for 15 million tonnes of edible and for the improvement of the living standards of the
oils leaving a net gap of about 2.7 mt in domestic farmer population. The Market Information System was
availability of edible oils by 2010 AD. The review of completely based on private sector participation. Rahman
simulation results suggested that the model developed can (2003) reported that the existing service capability of
be successfully used for strategic planning as the simulated Market Information System was very poor in Bangladesh.
data gave close resemblance with the existing system. The limitations were non availability of required
Metkewar and Acharya, (2001) suggested possible information, unreliable and untimely availability of
alternatives to approach the problem of formulation of the information and lack of awareness among farmers with
arrival-prices information systems for the regulated markets respect to the use of available information.
in Maharashtra as; Shreshtha (2003) identified that duplication of efforts, lack
a) A dynamic system of standardization, inadequate network for information
b) Artificial neural network and flow, lack of coordination and integration among various
c) Fuzzy – Dynamical system. agencies as some of the limitations of Market Information
They suggested that a model free approach would be System in Nepal. The researcher also reported that the
appropriate as arriving at appropriate functional forms and information service served the needs of the policy makers
examining the stability of the dynamic system would be a rather than the producers and traders.
very difficult task given the various market forces affecting Yan Bo and Bu Yibio, (2003) studied the agricultural
the system and given the state of information that is marketing system in China and found that the major
maintained at the market committees. information sources of Chinese farmers were other farmers,
Rai et al. (2001) in their study on application of television and broadcast. The Chinese farmers were not
information technology in agricultural marketing explained sensitive to the price changes on future market and
the necessity for developing a Farmers Agriculture international market. Similar results were obtained by Rana
Information System (FAIS) which could be operated at and Astuti, 2003.
Zonal Agricultural Research Stations (ZARSs), Krishi Anonymous (2004) studied the information system and its
Vigyan Kendras (KVKs), Agricultural Marketing uses in Chinese agriculture. Accordingly, the Ministry of
Corporations (Mandis) and Extension centers of SAU‟s Agriculture (MOA) initiated research on computer
where farmers normally assemble for various reasons. application in agriculture during Seventh Five Year Plan
Anonymous (2002) reported that the National Horticulture for the first time and the first professional journal entitled
Board (NHB) had launched a scheme for development of “Computer Application in Agriculture” started to appear in
marketing of horticulture produce realizing that a sound 1986. In order to achieve industrialization and market-
system of marketing with the latest and accurate orientation of agriculture through Internet, Ministry of
information on prices and arrivals on the Internet was Agriculture developed the website known as China
important for effective disposal of highly perishable Agricultural Information Network (CAIN), one of the
horticultural crops. The NHB has been catering to this need earliest government websites related to agriculture. CAIN
since 1988 with 33 marketing information centres located also emphasizes on services for production operation and
all over India called NHB NET. These centres collected the market.
market information and sent it to a coordinating cell for China‟s ministry of agriculture has established an
publication of monthly bulletins (www.nhb.gov.in). information centre to act as a nodal agency for constructing
Dhankar (2003) studied the Agril Marketing information the information system for country‟s rural market. MOA
system network (Agmarknet) in India and found that almost has also initiated the action plan for the program of rural
all the states and union territories were providing market market information service under tenth five year plan
information in one form or the other for the benefit of (2001-2005). A rural market information system
market users like producers, traders and consumers. construction leading group and office setup by MOA will
However, the information was collected and disseminated be responsible for planning, guiding and supervising the
by conventional methods which caused inordinate delay in action plan of rural market information service nationwide.
communicating the information to different target groups, The action plan concentrates on providing timely and
and thus adversely affecting their economic interest. accurate information for the development of rural economy,
Therefore there was a need to improve the present market the strategic restructuring of agriculture sector and the
information system by linking all Agricultural Produce increase of farmers‟ income. The aim is to establish rural
Market Committees / wholesale markets, State Agricultural market information service network through strong
Marketing Boards and State Directorates of Marketing and collaboration of news media, agricultural information
Inspection (DMI) with the DMI of the Ministry of websites, teams of farmer information collectors and
Agriculture for effective and efficient information agricultural socialization service organizations. To enhance
exchange. Thus, the Department of Agriculture and Co- the role of radio and other information distribution