Agricultural Marketing Management.ppt

8/10/2019 Agricultural Marketing Management.ppt

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Agricultural Marketing

Management

Ullas P Ramakrishnan

Section II- Agricultural Input

Planning


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Agricultural Marketing

Defn: AM consists of functions & services used in movingcommodities from producer to the final consumer

Defn: AM as a process starts with a decision 2 produce asaleable farm commodity. It involves all aspects of marketstrucure or system, both functional & institutional, based oneconomic considerations and includes pre & post harvestoperations, assembling, grading, storage, transportation &distribution- Nat ional Comm ission for Ag r icu l ture

Marketable Surplus: Surplus that is available 4 sale aftermeeting (i) family needs, (ii) seed requ irements, (iii) k indwages (crop instead of money given as wages 2 employees, (iv)

gif ts to fr iend s & relat ives Marketable Surplusfor Foodgrains (45-50%)

Cash Crops (80-100%)

Fruits & Vegetables (>90%)


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Agricultural vs Manufactured goods mktg

Sl

No

Base Agricultural

Goods

Manufactured Goods

1 Perishable Yes No

2 Seasonal Yes No

3 Variations in quality Natural By design

4 Processing Needed Finished

5 Size Bulk Varying quantities


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Essential functions of agricultural mktg

Assembling: Collection of produce for sale in mandis orlarger mkts

Grading & standardization: is the sorting of commoditiesinto different groups on the basis of size, variety, taste,quality, colour etc.. Standardization fixes the grades and doesnot allow them to vary from season to season and year2year.Grading & standardization are used interchangeably

Processing: is the conversion of farm produce into more

consumable forms . Eg. wheat>flour, paddy>rice. Processingimparts formutility.

Transporting: takes place through different means such asroad, rail, air and water and aims at creating placeutility.

Storing: Storage is the holding of produce from the time of

production until it is needed by the consumers. Storingcreated t ime utility. Some products such as fruits andvegetables are stored for short periods. Also they requirefacilities like cold storage.

Distributing: It relates to channels that take product to alarge number of consumers.


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Types of Agricultural Mkts

1. Based on LOCATION

Primary mkts {shandies(periodical),haats (1 particular day)};

Features: convenient place, cash payments. Secondary mkts { mandis, gunjs} Features: location-district

headquarters, towns, bulk quantities; middlemen,marketing

agents, commission agents r involved in mktg system; Facil i t ies:

grading, packaging, warehousing, loading, transportation,

telephone & banking facilities r available. Terminal mkts { pdt to customer, processed or assembled 4

exports)Features: r located @ highly populated cities like

mumbai, chennai, delhi, kolkata) Functions performed:

assembling of goods, grading, warehousing, distribution for

processing, financing & risk bearing, price maintenance,commodity exchange


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Types of Agricultural Mktscont

2. Based on the FREQUENCY they r held (daily, weekly, biweekly &

monthly mkts)

3. Based on the TYPES of product traded (grains, cotton, fish, fruit& vegetable mkts etc)

4. Based on the VOLUME of transaction (Wholesale

mkts>primary, secondary, terminal; Retail mkts)

5. Based on the NATURE of transaction (spot or cash mkts,

forward mkts)6. Based on the NUMBER of commodities {General Mk ts- alltypes

of commodities, foodgrains, oilseeds, fibre crops, Special ized

mkts- one or two commodities, eg. Foodgrain mkts, vegetable

mkts, wool mkts, cotton mkts)


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Agricultural Input Marketing

Agricultural Inputs; 2 types

Consumable Inputs: manures, fertilizers, seeds,

insecticides/pesticides, diesel, electricity

Capital Inputs: tractors, trailers, harvesters,threshers, pump sets etc.


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Nature of Demand

From marketers point of view, agricultural inputs show a

mix of consumer & industrial products characteristics

Consumption; Farmers do not consume like consumer

pts, but demand comes from demand for agricultural

production. So it is derived demand. Therefore

characteristic of an industrial pdt

Distribution & Promotion: is like consumer pdts as

these are targeted towards customers.

Product & Price: also like industrial pdt as it has derived

demand, complementary to other inputs, also bulky &

high cost.


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Sales of inputs depend on

Weather in a season

Cropping pattern changes

Nature and health of the crop Other facilities like govt price policy,

subsidies, loans and physical facility for

the product.


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Promotion

Retailers: as most farmers are illeterate,

they play a very important role for agri

input company sales

Also kisan mela, fairs, haats etc


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Nature of Competition/Competitive Environment1. WTO & Trips & MNCS

2. Seeds/Planting/ Breeding Material:

Accouns for 20-25percent of productivity

Seed sector in India consists of two national- level corporations

i.e. National Seeds Corporation (NSC) and State Farms

Corporation of India (SFCI).

At the State level, there are State Seed Corporations (SSCs).

Besides, there are private seed companies.

The Seeds Act, 1966; Seeds Rule, 1968; Seed Control, 1983;

National Seeds Policy, 2002; and New Policy on Seed

Development, 1988 provide the framework for seed development.

The Central Seed Committee (CSC), Central Seed Certification

Board are apex agencies set up under the Seed Act. Under the

Act, State Seed Certification Agencies (SSCs),State Seed TestingLaboratories (STLs),Central Seed Testing Laboratories (CSTLs),

Seed Law Enforcement Authorities (at the state level) and

National Seed Research and Training Centre (NSRTC) have been

set up to deal with all matters relating to quality regulation of

seeds.

N f C i i /C i i E i


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3. Protection of Plant Varieties and Farmers Rights Authority

(PPV&FR)

Varieties of crops can have proprietary or Intellectual PropertyRights (IPRs) on them through either patent or plant variety

protection or a combination of both. Legislation for Protection of

Plant Varieties and FarmersRights was enacted in 2001.

The legislation provides for the establishment of a sui generis and

an effective system for both the protection of plant varieties, the

rights of farmers and plant breeders on the one hand and to

encourage the development of new varieties of plants on the other.

The PPV&FR Authority registers plant varieties to protect plant

breeders rights, thereby stimulating R&D investment in

development of new plant varieties.

4. New Policy on Seed Development (NPSD)

New Policy on Seed Development (NPSD), 1988 was formulated

with a view to provide the best planting material available abroad to

Indian farmers. The policy has, over the years facilitated import of

seeds under various categories such as coarse cereals, pulses,

seeds of vegetables, flowers, etc. to improve agricultural production

Nature of Competition/Competitive Environment

N t f C titi /C titi E i t


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5. National Seeds Policy, 2002

The National Seeds Policy, 2002 was formulated keeping in view

the rapid changes that had been taking place in the national

economic as well as agricultural sector and also the changes in the

international markets. The policy aims at enhancing food production

targets achievable by enhancing significantly, the Seed

Replacement Rates (SRR).

Nature of Competition/Competitive Environment


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Challenges

There is a mismatch between the seed multiplication

ratio from breeder seed to foundation seed and from

foundation seed to certified seed, which needs to beaddressed.

The unorganized sector comprising a source mainly of

farm-saved seeds accounts for nearly 80 percent of this

seed supply. This requires attention.Comprehensive and authentic databases on seed

production and trade in India by public and private

sectors as required under the seed and plant variety

laws need to be built up.

The seed chain and the norms for quality control should

be followed without any compromises or shortcuts.


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Challenges

For horticulture crops which have a long gestation period

, it is imperative to ensure that only such varieties are

imported that are suited to Indian conditions .

A number of transgenics particularly in cotton and

vegetable crops, are sought to be introduced into the

country. The potential loss of production on account ofnon introduction of transgenics has to be carefully

balanced against the dangers that transgenics may pose

to ecology. However if a crop is safe for environmental

release and beneficial to the farmers, such transgenics

may need to be taken up in order to ensure that food

security in the country is achieved and maintained.

F k f d t di k t f


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Frame work for understanding market for

inputs

Four major components

Agronomic potential: demand for output,

output price, pesticide price.

Agro-economic Potential: infrastructure,

services, scale, information, organization,entrepreneurship.

Effective demand: food processing, transport ,

storage, etc

Actual Consumption: Even after having good

production, consumpion is function of supply

and effective distribution (eg onions)

Documents

Agricultural Marketing Management.ppt