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Sequence of presentation
1. REGULATED MARKETS IN INDIA2. PRODUCER SURPLUS
3. TYPES OF PRODUCER SURPLUS
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INTRODUCTION
The origin of regulated markets in India datesback to 1864.
150 regulated markets at the time ofindependence.
Number has increased to the 6,251 by 1990.
Currently, 6261 Wholesale Markets in India(majority are regulated markets).
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20870 Rural Primary Markets (about 15% are
regulated markets).
Total27131
2459 Principal Regulated Markets
5006 Regulated Market Sub-yards
Total
7465
(Only 286 regulated markets in 1950)
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The regulated markets are established toavoid the proverbial exploitation of farmersby the traders and their middle men.
To develop the necessary marketingfacilities and fair practices
To create competitive marketing conditionsamong the traders
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Contd
To provide remunerative high prices as wellas safeguard the farmers against various
malpractices in the markets and
To create the requisite environment for
efficient marketing of the agriculturalproduce.
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Objectives Regulated Markets
1. To ensure reasonable gain to the farmers by creating
environment in markets for fair play of supply and
demand forces,
2. To regulate market practices and attain transparency
in transactions
3. Aimed at providing proper method of sale, correct
weighment, prompt payment and various marketing
related services
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4. Democratic set up to control and manage markets
5. Advent of regulated markets has helped in
mitigating the market handicaps of producers/
sellers at the wholesale assembling level
6. Achieved only limited success and Rural Periodic
Markets in general, and the tribal markets in
particular, remained out of its developmental ambit.
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Constraints in Agricultural Marketing
Small size of land holding
Lack of infrastructure
Limited access to the market information
Lack of fair price discovery mechanism
Multiple channels of distribution
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contd..
Multiple and exploitative intermediaries lowreturns
Fragmented supply chain, poor cold chain & highpost-harvest losses
Lack of cleaning, grading, packaging & quality
certification facilities
Limited access to market information andmarketing opportunities available
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Initiative of Market Reforms
Amendments in APMC Acts suggested by Expert
Committee on Market Reforms constituted by the
Ministry of Agriculture (Report in June, 2001)
Expert Committee recommendations discussed in the
National Conference of State Agriculture Marketing
Ministers on 27.09.2002
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Contd
Standing Committee of State Agricultural Marketing Ministers
constituted under the Chairmanship of Union MOS (A) met &
resolved to implement reforms in 2003
Committee headed by Additional Secretary (AM), GOI
including State Representatives set up to draft a Model Law for
Agri-Marketing
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Model APMR Act finalized on 09.09.2003 by theCommittee and circulated to States by CentralGovernment
Model Rules based on the Model Act circulated toStates by the Ministry in November, 2007
NDC has resolved on 29th May, 2007 forcompletion of amendments in APMC Acts andnotification of Rules there under by March, 2008.
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PRODUCERS SURPLUS
Producers surplus is the quantity whichmade available for to the non-producingpopulation of the country.
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Agriculture production expands determinesthe pace of agriculture development, whilethe growth in the marketing Surplus
determines the pace of economicdevelopment.
The larger the production of the commodity,the larger the surplus of that commodityand vice-versa.
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Types of Producers Surplus
1. Marketable surplus.
2. Marketed surplus.
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Marketable surplus
The Marketable surplus is the residual left with theproducer-farmer after meeting his requirements.
The Marketable surplus is the total quantity ofarrivals in the market out of the new crop.
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Marketable surplus
Marketable surplus as follows:
MS= P-C
Where
MS= Marketable surplus
P = Total production, and
C = Total requirements (consumption)
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Marketed surplus
Marketed surplus is that quantity of theproduce which the producer-farmer sells in
the market, irrespective of his requirementsfor family consumption, farm needs andother payments.
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Relationship between Marketed
Surplus and Marketable surplus
The Marketed surplus may be more, less or
equal to the marketable surplus, dependingupon the condition of the farmer and type ofthe crop.
Marketed Surplus Marketable surplus=
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The relation between Marketed Surplus
and Marketable surplus may be stated asfollows:
1. Marketed Surplus is more than the
Marketable surplus when the farmerretains a smaller quantity of the crop thanhis actual requirement for the whole family
and farm needs.
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2. Marketed Surplus is less than theMarketable surplus when the farmerretains some of the surplus produce.
This situation holds true in followingcondition:
a) Large farmers generally sell less than themarketable surplus because of their betterretention capacity.
b) Farmers may substitute one crop foranother crop either for family consumptionpurpose or for feeding their stocks because
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3. Marketed Surplus may be equal to theMarketable surplus when the farmerneither retains more nor retains less thanhis requirement.
This holds true in perishablecommodities.
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Marketed and Marketable surplus
These helps the policy-makers as well asthe traders in the following areas:
1. Farming sound price policies.
2. Developing Proper Procurement andPurchasing strategies.
3. Checking undue Price Fluctuations.
4. Decisions related to the export and export.
5. Development of transport and Storagesystem.
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Factors affecting Marketable surplus
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1. Size of holding
2. Production
3. Price of the commodity
4. Size of family
5. Requirement of seed and feed
6. Nature of commodity7. Consumption habits
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CASE STUDY
Farm of Mr. Jagdish
DATA GIVEN : Quantity sold
120 quintals of Wheat
15 quintals of barley
48 quintals of mustard
40 quintals of gram
60 quintals bajra
1/29/2014 26Agril. Marktg. in India, S.S. Acharya N.L. Agrwal
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Total production and the requirements
of the farm and family are shown as:
Crops Areaundercrop(Ha)
Productivity(Qtl/Ha)
Seedrequirement(Qtl)
Consumptionrequirementper adult unit(Qtl)
Requirementfor Artisansand others
Wheat 8 20 6.0 2.00 2
Barley 2 12 1.0 0.50 -
Mustard 5 10 0.4 0.10 -
Gram 5 10 2.5 0.25 1
Bajra 15 6 3.0 1.00 -
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Crop TotalProduction(Area xProductivity)
Seedrequirem-ent
ConsumptionrequirementNo. of units xrequirementper unit
Otherrequirement
T0otalrequirement
Wheat 8 x 20 = 160 6.0 6 x 2.0 = 12.0 2.0 20.0
Barley 2 x 12 = 24 1.0 6 x 0.5 = 3.0 - 4.0
Mustard 5 x 10 = 50 0.4 6 x 0.1 = 0.6 - 1.0
Gram 5 x 10 = 50 2.5 6 x 0.25 = 1.5 1.0 5.0
Bajra 15 x 6 = 90 3.0 6 x 1.00 = 6.0 5.0 9.0
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Crop TotalProduction(Qtls)
Totalrequirement(Qtls)
MarketableSurplus(Qtls)
Marketedsurplus(Qtls)
As percentage ofproduction
MarketableSurplus
Marketedsurplus
Wheat 160 20 140 120 87.50 75.00
Barley 24 4 20 15 83.33 62.50
Mustard 50 1 49 48 98.00 96.00
Gram 50 5 45 40 90.00 80.00
Bajra 40 9 81 60 90.00 66.67
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Marketed Surplus of Important Agricultural
Commodities in Various States in India
Group of Crops Crops Per cent2003-04 2004-05
1 2 4 5Food grains : Cereals 1. Rice 75.19 71.37
2. Wheat 67.69 63.33
3. Maize 73.26 76.22
4.Jowar 62.50 53.44
5. Bajra 56.95 69.396. Barley 43.40 56.05
7. Ragi 37.33 57.74
Vegetables 1. Onion 99.78 82.91
2. Potato 75.71 85.001/29/2014 30
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Growth Rates of Production of Principal Crops in
India from 2005-06 to 2009-10
-50.00
-40.00
-30.00
-20.00-10.00
0.00
10.00
20.0030.00
40.00
50.00
60.00
2005-06 2006-07 2007-08 2008-09 2009-10*
Rice
Wheat
Ragi
(Base: T.E.1993-94 = 100)
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Area, Production and Yield of Wheat in
India (2004-05 to 2009-2010 )
YearArea
(Million
Hectare)
Production(Million
Tonne)
Yield(Kg./
Hectare)2004-05 26.38 68.64 2602
2005-06 26.48 69.35 2619
2006-07 27.99 75.81 2708
2007-08 28.03 78.57 2802
2008-09 27.75 80.68 2907
2009-10 28.52 80.71 2830
Source : Ministry of Agriculture, Govt. of India.1/29/2014 32
l f h k f d
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Arrivals of wheat in Markets of Major Producing States During
2005 to 2008 (Qty)
STATESYEAR
2005-06 2006-07 2007-08
Haryana 3947470 4593091 7574231
Uttar Pradesh 1556179 1789734 1810198
Bihar 1237230 1451383 1081550
MP 1164824 1377355 9061322
Punjab 793000 9698000 10579000
Rajasthan 789329 1037531 923467
Uttaranchal 308629 282312 320866
Maharashtra 283393 194678 N.A
Karnataka 16488 33743 54569
Jharkhand 21919 20596 10969
Delhi 160390 315260 863301/29/2014 33www. agmarknet.nic.in
i i i d i d i ld f h i
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District-wise Area, Production and Yield of Wheat in
Karnataka(2004-2005)
DistrictArea
(in hect.)
Production
(in tonne)
Yield
(tonne/hect.)Bagalkot 21202 32903 1.55Belgaum 56811 59112 1.04Bellary 848 768 0.91Bidar 7373 4546 0.62Bijapur 49116 44599 0.91Chikmagalur 6 9 1.5Chitradurga 658 932 1.42Davangere 316 383 1.21Dharwad 39502 21470 0.54Gadag 36348
24519
0.67
Gulbarga 16517 11494 0.7Haveri 783 433 0.55Koppal 9762 4371 0.45Mandya 3 1 0.33Raichur 2746
756
0.28
Source : Ministry of Agriculture, Govt. of India.
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Marketable and Marketed Surplus of Wheat
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Commodity/state/Particulars
Marginal Small Medium Large Over all
Wheat
Uttar Pradesh
ML -11.0 48.1 52.7 64.0 45.7
MD 17.1 22.7 48.6 68.0 42.2
HaryanaML 32.0 50.0 65.0 63.0 62.0
MD 38.9 60.8 76.9 67.1 70.7
PunjabML 61.3 70.1 80.7 88.1 83.1
MD 54.2 62.3 91.8 91.1 87.2
RajasthanML -31.2 0.8 47.1 41.4 32.9
MD 18.5 13.7 53.2 49.7 49.1
All IndiaML 4.1 49.6 61.4 70.8 59.7
MD 23.5 32.3 62.3 73.0 58.9
Source: DMI, GOI, Faridabad,1995ML- Marketable surplus, MD- marketed surplus
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TOTAL FARM FAMILY REQUIREMENT AND MARKETABLE SURPLUS OF
PADDY.(AVERAGE 1996-97, 1997-98 and 1998-99)
SL.No.
Category Totalproduction
A
Total farm family
requirement including
lossesB
Marketablesurplus(A-B)
(1) (2) (3) (4) (5)
1. Small 52020.67 28619.76(55.01)
23408.91(44.99)
2. Medium 36672.35 15268.70(41.64)
21403.65(58.36)
3. Large 33569.27 10576.83(31.51)
22992.44(68.49)
Total 122270.29 54465.29(44.54)
67805.00(55.46)
(000 tonnes)
1/29/2014 37Source: Ministry of Agriculture DMI Nagpur (2002)
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MARKETABLE SURPLUS OF PADDY(AVERAGE 1996-97, 1997-98 and 1998-99)
SL.No
.
Category
Totalproduction
A
Total farmfamily
requirement
includinglosses B
Marketablesurplus
(A-B)
Marketedsurplus
Qty. % Qty. % Qty. %
1. Small 52020.67 28619.76 55.01 23408.91 44.99 22778.45 43.78
2. Medium 36672.35 15268.70 41.64 21403.65 58.36 19619.09 53.49
3. Large 33569.27 10576.83 31.51 22992.44 68.49 21144.11 62.99
Total 122270.29 54465.29 44.54 67805.00
55.46 63541.65 51.97
(000 tonnes)
1/29/2014 38Source: Ministry of Agriculture DMI Nagpur (2002)
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Production, Marketable Surplus and Marketed Surplus of Paddy
(Qantity in '000 tonnes and percentage of total production)
Production 122270.29 (100.00%)Marketable Surplus 67805.00 (55.46%)
Marketed Surplus 63541.65 (51.97%)
0
20000
4000060000
80000
100000
120000
140000
Production Marketable
Surplus
Marketed
Surplus
Paddy
Production
Marketable SurplusMarketed Surplus
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STATE-WISE BREAK UP OF PRODUCTION, FARM FAMILY REQUIREMENT,
MARKETABLE SURPLUS AND MARKETED SURPLUS OF PADDY.
(AVERAGE 1996-97, 1997-98 and 1998-99)
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1/29/2014 41Source: Ministry of Agriculture DMI Nagpur (2002)
MARKETABLE SURPLUS RATIOS OF FOODGRAIN
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MARKETABLE SURPLUS RATIOS OF FOODGRAIN
CROPS
S. No. Commodity Marketable
surplus ratio(Percentage)
Year of which data relates
1. Rice 32.2 Market Report 1951
2. Wheat 37.8 Marketing Report1957-58 and 1958-59
3. Jowar 29.6 N.A.
4. Bajra 27.2. N.A
5. Barley 28.0 N.A.
6. Maize 38.5 N.A.
7. Ragi 18.2 N.A.
8. Gram 45.2 N.A
9. Arhar 62.4 Marketing Report 1956-57
10. Urad 63.5 -
11. Masoor 28.8 -
12. Moong 60.7 -Source: Directorate of Economics and Statistics,19761/29/2014 42
MARKETABLE SURPLUS RATIOS OF SELECTED
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MARKETABLE SURPLUS RATIOS OF SELECTED
CEREALS
Sl.No.
Commodity Marketablesurplus ratio(Percentage)
Year ofreference
Year ofpublication
of report
1. Paddy 8.87 1972-73 1979
2. Wheat 65.10 1973-74 1986
3. Jowar 33.14 1974-75 1984
4. Bajra 36.31 1974-75 1985
5. Maize 30.86 1974-75 1987
1/29/2014 43Source: National survey , DMI, 1972-73
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Marketed Surplus of Paddy in Haryana
Category offarmers
Marketed surplus(% to production)
Marginal 90.82Small 90.73
Semi medium 94.39
Medium 96.39Large 98.14
Total 96.31
1/29/2014 44Parmod kumar, 1999
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MARKETED SURPLUS OF RAGI
(AVERAGE 1996-97, 1997-98 and 1998-99)
S.No. Contribution States
1. More than 400 Karnataka (426.05)
2. 50-400 Andhra Pradesh (84.05)
Tamil Nadu (62.69)
3. 10-50 Uttar Pradesh (33.73)Maharashtra (27.12)Orissa (15.56)
4. Less than 10 Gujarat (3.52)Madhya Pradesh (0.61)
(000 tonnes)
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Production, Utilisation and Marketable Surplus of Ragi
(Qantity in '000 tonnes and percentage of total production)
0
500
1000
1500
2000
2500
EstimatedProduction
EstimatedUtilisation
EstimatedMarketable
Surplus
Estimated Production
Estimated Utilisation
Estimated MarketableSurplus
Estimated Production 2282.84(100.00%)Estimated Utilisation 1612.72(70.64%)Estimated Marketable Surplus670.14(29.36%)
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TOTAL FARM FAMILY REQUIREMENT AND ESTIMATED
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TOTAL FARM FAMILY REQUIREMENT AND ESTIMATED
MARKETABLE SURPLUS.
(AVERAGE 1996-97, 97-98 and 98-99).
SL.No. Category TotalproductionA
Total farm-familyrequirementincludinglossesB
Marketablesurplus(A-B)
1. Small 844.01 648.59(76.85) 195.42(23.15)
2. Medium 671.14 441.74(65.82)
229.40(34.18)
3. Large 767.69 522.37
(68.04)
245.32
(31.96)Total 2282.84 1612.70
(70.64)670.14(29.36)
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MARKETABLE SURPLUS OF RAGI
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MARKETABLE SURPLUS OF RAGI
(AVERAGE 1996-97, 97-98 and 98-99).
SL.
No
Category Total
productionA
Total farm-
familyrequirement
includinglosses
B
Marketable
surplus(A-B)
Marketed
surplus
Quantity
% Quantity
% Quantity
%
1 Small 844.01 648.59
76.85 195.42 23.15 186.26 22.07
2 Medium 671.14 441.74
65.82 229.40
34.18 225.57 33.61
3 Large 767.69 5222.37
68.04 245.32 31.96 241.51 31.46
Total 2282.84 1612.
70
70.64 670.14 29.36 653.34 28.62
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STATE-WISE BREAK UP OF PRODUCTION, FARM FAMILY
REQUIREMENT, MARKETABLE SURPLUS AND MARKETED SURPLUS OF RAGI.
(AVERAGE 1996-97, 97-98 and 98-99).
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The startling fact to be noted here was that the states like Andhra Pradesh had morethan 60 percent marketable surplus. In states like Karnataka, Orissa and Tamil Nadu,the marketable surplus was more than 20 percent
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RETENTION OF RAGI BY FARM
HOUSEHOLDRagi is retained for
i) Farm-family consumption,
ii) Consumption by permanent labour and temporarylabour engaged on the farm,
iii) Seed purpose,
iv) Animal feed,
v) Barter (now nearly disappeared) andvi) Payments in kind and cash for different purposes.
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Production Retention and Marketable Surplus of Rice and Wheat
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Production Retention and Marketable Surplus of Rice and Wheat
(Farm size-wise) in India During 1999-2000
Size group Production Feed and
seed
Family
consumption
Marketable
surplus (%)
Rice
Marginal 25.87 1.03 30.08 20.26
Small 21.58 0.87 9.53 51.81
Semi-medium 18.22 0.73 6.61 59.75
Medium 13.09 0.52 3.60 68.52
Large 10.73 0.43 0.78 88.69
All groups 89.49 3.58 50.60 39.46
Wheat
Marginal 16.94 1.86 20.31 30.88
(Million Tonnes)
Source : Various issues of CMIE Publications.1/29/2014 53Atteri,
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Marketable Surplus of Rice and Wheat and
Benefits of Storage to the Farmers in India
It was concluded that 60 per cent of the farmers aremarginal farmers and do not have marketable surplus.
In fact, marketable surplus of these farmers in respect ofrice and wheat in 1999-2000 was negative.
The small, semi medium, medium and large farmers hadthe marketable surplus in India.
The estimated marketable surplus with small, semimedium, medium and large farmers was 51.81, 59.75, 68.52and 88.69 per cent for rice and 8.74, 60.24, 71.53 and 85.00
per cent for wheat, respectively ignoring losses. The total estimated marketable surplus for all India was
39.46 per cent and 43.79 per cent for rice and wheat,respectively.
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D.S. Thakur AND A.S. Shandi
The Bihar Jn. Of Agri. Mktg.
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REASONS FOR LOW MARKET ARRIVALS STRATEGIES TO
PROMOTE ARRIVALS IN REGULATED MARKETS
REASONS ANDMARKETING PROBLEMS STRATEGIES
1. Regulated Market
yards are developedaway from the oldshops of traders fromthe town.
1. Sufficient investmentshould be done tomodern regulatedmarkets near the towns atcentral place.
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2. Traders purchase theproduce direct fromthe farmers in the
village or at their oldshops out side themarkets.
2. market committeeofficials should bestrong , and active toavoid such
malpractices.
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3. Generally, marketcommittees areweak with andincompetentofficials and staffplay in the handsof traders.
3. Sufficient financialsupport politicaland other must begiven. rules and actmust beimplemented.
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4. Lack of competition, 4. Market committee and
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4. Lack of competition,arrival of only 2-3 tradersin the regulated marketsat the time of action,
o payment of low prices,
o delay in unloading oftrucks and sale ofproduce at high rate ofcommission,
o Malpractices in Cleaning,weighing, grading andselling of produce.
o Delayed payment tofarmers and same priceoffers for different lots ofproduce.
4. Market committee andboard officials shouldremove these bottlenecks
which discourage marketarrivals.
private traders, co-operatives and Govt.agencies in the market
yards must beencouraged for forwardspiral of healthycompetition marketing
practices and prices all-around.
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5. Farmers remain at themercy of traders who
purchase bulk ofagricultural producein the market yards bypaying low prices with
no official coming tohelp the farmers.
5. Must imposerestrictions and
exercise control overtraders on buildingup stocks and unfairtrading practice,
avoid exploitation offarmers and ensureremunerative prices.
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6. Market committee doesnot ensure proper andquick sale of produce
Broad and committeesnot providing credit,storage facilities, rural-roads and transport
facilities.
6. The marketing board andcommittee must providefacilities for the benefit of
farmers so that farmerswill bring more and moreagricultural produce forsale in the regulated
markets.
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7. Farmers not aware of thebenefits and facilities of sale
in regulated markets. Market committee not
developing requiredrapport, awareness andbusiness relation with
farmers. Regulated markets should
also make available credit tofarmers on the basis ofpledge of their produce, asalready done in some states.
There is a need to supplyother inputs. Transportfacilities, market
intelligence .
7. There is a need for strongtraining of framers in all
aspects of regulatedmarkets and agriculturalmarketing.
Agricultural marketing tobuild a strong bond of
relationship, rapport andknowledge so that farmers
will bring all theirmarketable surplus to theregulated markets.
The field and market visitsof farmers should to beorganized
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Concluding remarks
The scope for large-scale increase in agriculturalproduction and arrivals in the regulated market infuture.
It is in fact the lack of efficient regulated marketspoorly.
The strategy of training of farmers, large-scaleinvestment in the providing requisite marketingfacilities, control over the scrupulous trading practices
of traders and strict implementation of the regulatedmarkets act as outlined above will at once marketarrivals in the regulated markets.
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Concluding remarks cont.. The state Govt. and chairpersons of the marketing
board and market committees must personally ensureand oversee that staff of the marketing board and
market committees work and act as the true servantsof the farmers and public at large.
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-A Case analysis
N. SaktivalDr. A. SelvaraJ
Financing Agriculture A National Journal of Agriculture & RuralDevelopment(2009)
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Distribution of Sample Responds
by the level of Significance
Level of
Significance
Number of
respondents
Percentage
Less Satisfied 36 18 %
ModeratelySatisfied
60 30 %
Highly Satisfied 104 52%Total 200 100 %
Performance of Satyamangalam regulated market, T.N.
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Problems faced by Farmers in
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Problems faced by Farmers in
Regulated Markets
Time consuming i.e., sale proceeding in regulatedmarket takes more time.
Lack of market news services.
Lack of transportation facilities. Lack of facilities for marketing of all agricultural
commodities.
Lack of amenities.
Lack of storage facilities for keeping all the agriculturalcommodities.
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D.P. MALIK, S.N. SINGH AND K.N. RAI
Journal of Agricultural Marketing
1992
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P d i C i M k bl d
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Production, Consumption, Marketable and
Marketed Surplus of Wheat and Paddy
Item Wheat Paddy
Total Stock 108.59 (100) 117 (100)
Total Production 94.70 (87.21) 103.72 (88.42)
Total consumption 29.43 (27.10) 10.49 (8.92)
Marketable Surplus 79.18 (72.90) 107.19 (91.08)
Marketed Surplus 73.91 (68.08) 101.60 (86.34)
Stock left at the endof the year5.27 (4.48) 5.59 (4.74)
in quintals
Note: Total stock includes current year production + receipts from other sources carry over stock + purchase made during the year.
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REFERENCES
Web: 1
.
India stat2.Ministry of Agriculture, Govt. of India.
3.Directorate of Economics and Statistics.
4. www. agmarknet.nic.inJournals: 1.Financing Agriculture A National Journal
of Agriculture & Rural Development(2009).
2.Journal of Agricultural Marketing.3.The Bihar Journal Of Agri. Mktg.
Book:Agriculture Marketing in India
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