Report on Marketing of Areca nut

INTRODUCTION• India is the leading producer contributing 51% of world’s total production.

• In India, arecanut is marketed as unhusked whole fruit, dehusked and dried nut, boiled dried whole kernel or boiled split and in the form of VAPS.

• About 20 %of total areca production in the country is consumed as ripe fruit .

CONTD….• Karnataka, Kerala, Tamilnadu, and Goa have

established regulated markets for arecanut. Karnataka -23,Kerala - 4 ,Tamilnadu and Goa -

minimum. In Karnataka, Kerala and Tamilnadu more than 30

percent of the marketable surplus is dealt by co-operative societies.

• There are more than 16 major co-operative marketing societies handling arecanut in Karnataka (CAMCO). There are no exclusive markets for the sale of arecanut in the country.

WORLD AREA OF ARECANUT

WORLDPRODUCTION OF ARECANUT

STATE WISE PRODUCTION OF

ARECANUT

STATE WISE PRODUCTIVITY OF

ARECANUT

THE IMPORTANT ASSEMBLING MARKETS

Karnataka - Mangalore, Shimoga, Sirsi, Sagar,Kumta and Bhimasamudra

Kerala -Palai, Ponkunnam, Alleppey, Cochin, Trichur and Kasargod .

Assam- Guwahati and Dhubri and Shillong Tamil Nadu- Chennai and Mettupalyam Goa- Ponda and Bicholim

Market influencing factors

• Foreign demand for the nut

• Import policies of the consumer countries

• Government policies over the pricing of betel nut

• Growth of the consumer industries

• Government policies over the consumer industries

• Weather condition during the growth period.

• Demand from overseas consuming centers like Nepal , Pakistan, Indonesia, Thailand and Burma.

• Government regulations and Growth of the Gutkha industry

VALUE CHAIN :

There are two types of system prevailing in marketing of Areca nut .

System – I

System - II

SYSTEM-I The growers bring their produce to the nearby

market after harvesting. The middlemen purchase the produce at

throughout prices and make arrangement to transport the same to supari traders / processing units.

The traders /processing units supply the same to retailers after processing of arecanut in the local market for use of local consumers as well as supply to outside the state.

System -II

The middlemen/traders purchase the areca

nut in the field by bargaining at a lump sum price and the traders make arrangements to market the same within the district as well as outside the district as per their convenience and considering the margin of profit.

Value system

1. Farmer Merchant Processor Consumer/Terminal market

2.Farmer Local vendor District level Market

PRIMARY DISTRIBUTION CHANNEL

• Prime markets at village level are held generally once in a week on a fixed day. There could be collection or pooling centers enabling the growers to market the produce.

SECONDARY MARKET DISTRIBUTION CHANNEL

• The secondary markets are regular wholesale markets held daily and are situated in a districts and Taluk head quarters and important trade centers. Both assembling and distribution takes place in these markets.

TERMINAL MARKET DISTRIBUTION CHANNEL

• The terminal markets are those where areca nut is assembled for further distribution for intra and interstate trade and for exports. Areca nut is marketed as un-husked whole fruit, de-husked and dried nut, boiled and dried whole kernel or nuts. 1/3 of total production in the country is consumed as ripe fruit and rest in the form of processed nuts.

PRODUCERS

CONSUMERS

TS/VS/contractor

TS/VS/Contractor/commission agent

Traders

Contractor

Traders

Retailers

Middle man

Wholesalers or processor

Overseas dealers

Retailers

Problems in existing channels

• More numbers of intermediaries• Local level forces and need for credit are high• Lack of information about prices• Low producer’s share in consumer price(30-

40%)• Farmers can not able go for value addition

Improved marketing channel

Overseas Customer

Cooperative processing and Grading society

Cooperative collection centers

Overseas Dealer

producer

Customer

Retailers

Retailers