This is the need of time to be associated with market.

1. Agricultural Marketing
Reforms & Marketing
Infrastructure
RABI CONFERENCE-2005

2. As a Farmer
 I must thank all of you for your efforts and
concerns
 But what use if I can not be facilitated to sell
my produce at
 Remunerative Price / Quality linked returns
 Choose my buyer
 Place and time convenient to me
 Escape the fleecing of multiple intermediaries

3. PRICE SPREAD
100%
18 14 16
90% 23 23
80% 20
17 19
70% Marketing
60%
35 36
Margins
50% Marketing
40%
65 66 65
Cost
30%
42 41
Farmer's
20%
Share
10%
0%
Rice Wheat Groundnut Apple Onion

4. Increasing Farmers Income
 90% of effort is Production oriented
 Only 10% on Marketing/Post harvest
phases
 Single intervention that can enhance
income by 20-30%
 Private Sector Investment

5. Domestic Markets Scenario
o Regulated Markets.
o 7161 of 7310 Wholesale Markets
Covered Under Regulation.
o Of 27,294 Rural Markets, 15%
Under Regulation

6. Domestic Markets Scenario
o Regulated Markets Lack Need Based Infrastructure.
o Development Confined to Wholesale Markets.
Rural Markets Remain Out of Development Ambit
o Current Mandi System Has Multiple Intermediaries
and High Value Loss
o APMC Regulation Prevents Companies From
Directly Sourcing From Farmers

7. Domestic Markets Scenario
o Fragmented Industry, with no Large
Organized Players
o High Wastage between the Farm and the
Retailer

8. Present Scenario in Value Chain
o Producer’s Share in Consumer’s Retail Price
Mere 40% to 60% depending on the commodity
o Only 25% of Produced Food-grains Utilise
Scientific Storage
o Less Than 2% of Fruits and Vegetables
Production Is Processed
o Post-harvest Losses estimate 10% of Food Grain
and 25% of Fruits and Vegetables Production

9. Problems
 Competitiveness is lost
 Quality assurance is a ?
 Loss of Value
 Export is a problem
 No Grading/Standardization
 Consumer Dissatisfaction
 No Market Intelligence
 No Price Discovery

10. Paradigm Shift
 Present Agriculture is Production Driven
 Transition to Agri-Business
 Market Driven
 What Consumer Wants ?
 Cutting the value Chain
 Knowledge led growth
 Private Investment

11. Investment Requirement (Rs. in crores)
Items Physical X Plan XI Plan Total
(Nos)
Wholesale markets 3213 2410 4016 6426
Modernization of 7293 2260 3766 6026
markets
Rural Periodic 27294 1024 1706 2730
Markets
Grading Centers 5786 400 750 1150
Modernizing Labs 100 10 10 20
Agribusiness Centres 1500 50 100 150
Warehousing (lakhTonne) 518 5965 6200 1216
5

12. Source of Investment
 Public Investment ??
 Significant role of Private Sector
 How do we get them into the sector
 Create enabling Policy and Legal
framework
 This requires Reforms

13. Road Map of Reforms
 Create enabling Legal and Policy
environment
 Private / Cooperative Markets

Direct Marketing and

Contract Farming Programs

Grading/Standardisation/Quality

14. Road Map of Reforms
 Establish Effective Linkages Between
Farm Production And Retail Chains
 Public–Private-Partnership to Promote
Professionalism in Existing Markets
 Stepping-Up of Pledge Financing and
Marketing Credit

15. Road Map of Reforms
 Introduction of Negotiable Warehouse Receipt
System In Storage Projects
 Link Commodity Exchange with Market Yards for
Price and Risk Management
 Information Technology to Promote Trade/ Market
Led Extension Services

Facilitate Investments

16. Leaders In Reforms
 Kerala,
 Tamil Nadu
 Madhya Pradesh
 Andhra Pradesh
 Punjab
 Himachal Pradesh
 Sikkim
 Manipur
 Nagaland
 Andaman & Nicobar

17. Followers
 Many States
 Enabled some components
 Require all Components

18. Scheme For Development /
Strengthening Of Agricultural
Marketing Infrastructure,
Grading And Standardization

19. Objectives of the Scheme
o To Induce Private and Cooperative Sector
Investments in Market Infrastructure Development
Projects
o To Strengthen Existing Agricultural Markets,
wholesale and rural periodic, to Enhance
Efficiency
o To Promote Grading, Standardization and Quality
Certification of Agricultural Produce at Farm/
Market Level

20. Coverage of the Scheme
 Agriculture/Horticulture
 Fisheries
 Meat & Poultry
 Minor Forest Produce
 Dairy
 Medicinal plants
 Apiculture

21. Components of the Scheme
 Functional Infrastructure
 Market user common facilities
 Shortening the Value Chain
 Direct Marketing
 Contract Farming
 E-Trading Infrastructure
 Market extension and market oriented
production planning
 Input Supply

22. Functional Infrastructure
 Assembling
 Combine harvesters
 Cleaning
 Assembling yards
 Collection centers
 Pre-cooling Chambers
 Grading
 Mechanical graders
 Color sorters
 Standardisation

23. Functional Infrastructure
 Quality Certification
 Establishing a Quality Lab
 Accredited Certified agency Infrastructure
 On-Farm Quality Testing Infrastructure
( Sugarcane Quality Testing for timely
harvesting and Maximum Sucrose
Content)
 Grapes Certification

24. Functional Infrastructure
 Labeling
 Bar coding
 Packaging
 Pack houses
 Packing material manufacturing as part of
the integrated project
 Retailing & wholesaling
 Food world
 Nilgiris
 Namdharis in Delhi

25. Functional Infrastructure
 Value addition
 Decortication of Groundnut
 Waxing of Kinnows
 Curing of Honey

26. Market user common facilities
o Market yards
o Platforms for loading/ assembling and
auctioning of the produce etc
o Modern auction Systems
o Weighing and Mechanical Equipment

27. Shortening the Value Chain
o Infrastructure for Direct marketing from producers
to consumers/ processing units/ bulk buyers etc
o Infrastructure for supporting Contract farming
arrangements between processing/ trading units
and farm producers
o Infrastructure for E-Trading, market extension
and market oriented production planning.

28. Scope of Infrastructure Projects
 Infrastructure for supply of production inputs
and need based services to farmers
 AI infrastructure
 Fertilizer storage units
 Feed storage units
 Marketing Intelligence
 Mobile infrastructure for post-harvest
operations
 Market extension and market oriented
production planning

29. Salient Features of Scheme
o Credit Linked Back-ended Subsidy on Capital
Investment for
 Setting up of General or Commodity Specific
Infrastructure for Marketing of Agricultural
Commodities; and
 Strengthening and Modernization of Existing
Agricultural Markets, Wholesale, Rural Periodic
or in Tribal Areas

30. Salient Features of Scheme
Persons Eligible
o Individuals, Farmers, Consumers, NGOs,
APMC, Corporations, Cooperatives and
Marketing Boards in the Entire Country.
o State Projects Assisted by NABARD/NCDC for
Modernization of Existing Markets Subject to
States allowing
 Competitive Markets in Private Sector
 Direct Marketing and Contract Farming
 Rationalize levy of Market Fee

31. Funding Arrangement
S.No. Components of Scheme Tenth Plan Provision
(Rs. In crores)
1. Capital Investment Subsidy on 175.00
Infrastructure Project
2. Strengthening of Central Laboratories 10.00
3. Awareness/Training, Consultancy and 5.00
Evaluation etc.
Total - 190.00

32. • Involve Women through SHGs

33. Expectations from Participants
 Treat marketing as an integral and critical link
 Awareness creation & Publicity
 Identify viable projects
 Capacity Building of all players
 NIAM, NABCONS can assist in Capacity
building, Project Preparation
 Assistance of Trained Project preparation
Experts

34. Further Details & Assistance
 www.agmarknet.nic.in
 reddywr@nic.in
 011 23382416

35. Thank You