Agricultural Marketing

Notes

Agricultural marketing covers all the activities involved in moving farm produce from the farmer to the consumer: assembling, grading, storage, transport, processing and sale. A good system gives farmers a better price share and reduces waste.

Existing system

APMC (Agricultural Produce Market Committee) mandis: State laws (the APMC Acts) require farmers to sell notified produce in regulated markets (about 7,000 principal and sub-yards), with licensed commission agents (arhatiyas); in addition there are about 22,000 rural periodic markets (gramin haats).
Problems: a chain of middlemen, high commissions and fees, cartelisation by traders, delays in payment, poor storage and cold chains, post-harvest losses, lack of grading and price information, and limited choice for small farmers.

Reforms and initiatives

Model APMC Act, 2003, and the Model APMC and Livestock Marketing Act, 2017; Model Contract Farming Act, 2018.
e-NAM (National Agriculture Market, April 2016): a pan-India electronic trading platform linking mandis, with SFAC as the nodal agency, offering online bidding and transparent price discovery.
Gramin Agricultural Markets (GrAMs) and direct marketing; farmer producer organisations (FPOs) to aggregate produce; the Agriculture Infrastructure Fund (2020).
Warehousing: the Warehousing Development and Regulatory Authority (WDRA, 2007) and negotiable warehouse receipts (e-NWR) allow farmers to pledge stored produce for credit; the Operation Greens scheme (2018) for tomato, onion and potato.
The three farm laws of 2020 (on trade outside APMCs, contract farming, and the Essential Commodities Act) were repealed in 2021 after protests.
Commodity futures: NCDEX and MCX (regulated by SEBI); some agricultural futures remain suspended.
Cooperative and institutional marketing: NAFED (1958), TRIFED (1987) (tribal produce), NCDC, APEDA (1986) for agri exports; the Amul model.
Digital: ONDC, Agmarknet.

Related law: the Essential Commodities Act, 1955 (stock limits to control hoarding), amended in 2020 and used selectively.

Key Points

APMC mandis regulate sales; middlemen and fees are problems.
e-NAM (2016) is a national electronic market.
WDRA and e-NWR support warehousing and credit.
Model APMC Act 2003 and 2017; contract farming Act 2018; farm laws repealed in 2021.
NAFED, TRIFED and APEDA support marketing.

MCQs

Q2. The nodal agency for e-NAM is: (a) NABARD (b) SFAC (c) FCI (d) NAFED Ans: (b).

Q3. WDRA issues and regulates: (a) Crop insurance (b) Negotiable warehouse receipts (c) MSPs (d) Fertiliser quotas Ans: (b).