Rural MarketingMarketing of Agri-ProduceRegulated MarketCooperative marketing and processing societiesRural Industry

Agriculture Produce Agriculture sector contributes 18.1% GDP in India

as on 2011. India is ranked second worldwide in farm output. India is the largest producer of many fresh fruits,

vegetables, milk, fibrous plants. India is second largest producer of rice and wheat. India is third largest producer of dry fruits. World five largest producer of 80% agri. produce. World five largest producer of livestock with

fastest growth rate as on 2011.

Marketing of Agriculture Produce The peculiar characteristic of agriculture produce

result in a very complicated marketing system and in the process rural produce are exploited. The rural credit survey conducted by RBI in 1951 described marketing system of agriculture produce as “Inefficient and Exploitative”

Income of rural consumer depend upon the efficiency of marketing of agricultural produce irrespective of the technology adopted in production. Any technology Innovation should go hand in hand with efficient marketing.

Agri-Marketing Around 700 million people or 70% of India’s

population live in 6,38,000 villages in rural areas.

90% of the rural population is concentrated in villages with population of less than 2000. Rural marketing is as old as the civilization.

Surplus of agro products are exchanged in earlier days in the barter system. The introduction of currency, transport and communication has increased the scope of rural market.

Agri-Marketing The demand for products an services has

increased a lot in rural areas.

Green Revolution in North and White Revolution in west has brought about a new prosperity in the lives of rural people. Government emphasis on rural development has caused significant changes in the rural scenario.

Moreover the special attention given for infrastructure development through the successive Five-Year plans has improved the buying and consumption pattern of rural people.

Marketing of Agriculture Produce The Rural Agro – Products The Peculiar Characteristic of Agriculture

Produce are : Bulkiness Perishability Wide Varietal Differences Dispersed Production Processing need for consumption Seasonality Comparative Advantage

Market them according to needs There are three marketing functions

while selling of agri-product Assembling Preparation for consumption Distribution

Selling of agriculture product depends upon Demand of product Availability of storage

Selling strategies The products can be sold directly or stored. It can be sold as gathered from the filed or it

can be cleaned, graded and processed. Distribution system needs to match supply

with the demand by whole selling and retailing in various points of different markets.

Most of the time the product is sold to moneylenders where farmers are indebted.

It can be sold weekly in village or at irregular intervals in mandi.

Government Institutions Commission of agriculture cost and

prices. Food Cooperation of India. Cotton Cooperation of India. Jute Cooperation of India. Specialized market for rubber, tea,

coffee, tobacco, spices and vegetables. Agriculture Produce Act of 1937.

Marketing of Agriculture Produce

Approximate Consumption Value of Major Agriculture Equipment

Conclusion Rural marketing depends on agricultural produce, the

production is seasonal and the consumption is spread out equalization of demand and supply has to be done.

In addition, the raw agricultural produce as marketed by farmers has to be processed by many middlemen This include collection and assembling, financing, grading and standardization, storage, transportation, wholesaling and retailing these functions performed by village merchants, commission agents, wholesalers, processors etc.

These people seek returns commensurations with their investments of capital, time and labor. As a result, the middlemen get more share of the price than the producers.

Cooperative Marketing A major improvement for rural producers is

the formation of cooperative societies. Farmer’s common interest helped to increase the incomes of the farmers and avoid exploitation by the middlemen.

There are about 5 lac cooperatives working but very few cooperative societies in selected areas like Dairy, sugar, oilseeds, Maha-grape in Maharashtra, tomato growers in Punjab etc. succeeded in cooperative processing industry.

Cooperative Society Historically Cooperative society in India

started with enactment of the Cooperative society Act 1904. Although in Bengal and Bihar some preexisted.

The purpose of cooperative societies before independence was to provide relief to farmer from moneylenders.

After independence they became a powerful instrument of economic development.

New objectives of Cooperative societies became A group of people should not exploit

others. Voluntary participation of planning and

implementation plan for economic development.

To avoid concentration of economic powers.

This is how the democratic India was planned to emerge after independence.

Merits of Cooperative societies They are association of persons with

common needs. They join hands for self protection. Promote social cohesion. Encourage individual initiative through

collaborative actions. They have ideological base, economic

objectives and social approach.

Roles of Cooperative Societies Increase returns to the farmers Helpful in creating marketing infrastructure. Associated with other aspects of agriculture. Providing inputs and consumer goods. Others

Finances farmer from the sale of their produce. Bulk purchasing so farmer has to pay less. Provide quantity seeds, pesticides and

fertilizers. Arrange availability of requisite inputs and

ensure distribution.

Regulated Markets A regulated market or controlled market, is

the provision of goods or services that is regulated by a government appointed body. The regulation may cover the terms and conditions of supplying the goods and services and in particular the price allowed to be charged and/or to whom they are distributed. It is common for a regulated market to control natural monopolies such as aspects of telecommunications, water, gas and electricity supply. 

Regulated market The produce had many defects and the royal

commission in 1928 studied this. The royal commission suggested commencing with the regulated markets and accordingly various market committees were incorporated. The three basic functions of this committee were To meet the demand of the Increase in population and

industrial advancement.

To increase the quality of agriculture produce.

To fetch an appropriate price for the farmers 

Objectives of Regulated Market To ensure reasonable gain to the farmers by

creating environment in markets for fair play of supply and demand forces.

  To regulate market practices and attain

transparency in transactions.

Aimed at providing proper method of sale, correct weighing, prompt payment and various marketing related services.

Democratic set up to control and manage markets.

Conclusion There are more than 5000 primary and secondary

agriculture produce whose assembling markets functioning in the country. These markets are meant for farmer to take their produce for sale.

These markets facilitates farmers, immediate cash payments. The directorate of state Agricultural Marketing Board or Registrar of cooperative marketing societies is controlling these markets.

The market is run by an elected committee comprising of members from the farmers community, commission agent/whole sealers and some government nominees from Directorate of state agriculture / cooperative societies.

Rural Industry Marketing of Rural/Cottage,

Industry/Artisan Product Rural and Cottage Industries and rural

artisan are very significant to rural economy. They have proved to be the source of employment and income generation for landless population who possess certain skills and talent acquired over generations.

Significance Provide a subsidiary occupation to rural

population. Enable the rural population to supplement

their slender income. Provide employment during off season,

drought and famines. Develop the rural talents, help uphold our

culture. Reduce evil of urban Industrialization. Suits a country like India very well.

Classification of Rural/Cottage Industries

Rural Industry There is tremendous scope for developing such rural, village and

cottage industries to augment the employment and income of people in rural areas.

To help such rural/cottage industries and rural artisans produce and market their production, a number of central and state level organization have been established.

The first and the foremost among them are KVIC (Khadi and Village Industry Comission) of Central Government and KVIB (Khadi and Village Industry Board) of different state government. These organization help rural folk in: Technology Up gradation Getting the artisan organized Getting credit from Institutions Procurement and supply of R/M Domestic Marketing through Retail outlet Export Marketing wherever possible

Conclusion If the rural market has to expand and grow,

it is not enough to just concentrate on marketing of manufactured goods, but it is also necessary to pay adequate attention to the marketing aspect of the rural product namely, agriculture produce of rural/cottage industries and rural artisan.

Such an approach will help rural population in generating adequate disposable income for purchase of manufactured goods.

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