1. SEMINAR
ON
MARKET LED AGRICULTURE:-
INSTITUTIONS, ISSUES & POLICIES
SPEAKER – AMOL JAMALE
REG. NO. - J4-000905-2011
JAU.

2. CONTENT
1 INTRODUCTION
2 EVOLUTION CONCEPT
3 DIMENTIONS
4 INSTITUTIONS
5 ISSUES
6 POLICIES
7 CASE STUDIES
8 CONCLUSION

3. INTRODUCTION
Market led agriculture is the market ward orientation of agriculture through
extension includes agriculture & economics is the perfect blend for reaching at
the door steps of farming community with the help of appropriate technology.
During last 50 years emphasis was given on PRODUCTION-LED
EXTENSION (PLE). India become self reliant on food production. But the
farmers at individual level are not realizing remunerative prices for their
produce. They prone to sell their produce “AS IS WHERE”.
Farmers need to transform themselves from producers to producers cum sellers.
Source: Sheela et al, (2008)

4. EVOLUTION OF CONCEPT OF M. L. A.
Legitimized -led agriculture :
Focussed mainly on rural development Some of the attempts include,
 Sevagram attempt – Mahatma Gandhiji – 1920.
 Shriniketan - Rabindranath Tagore – 1921.
 Marthandam project - Spencer Hatch – 1921.
 Gurgaon attempt – F. L. Bryne – 1927.
 Etawah pilot project - Albert Mayor – 1946.

5. CONT…
State -led agriculture :
Central and State governments took responsibility.
 Grow more food campaign -1947.
 Intensive Agriculture Development Programme -1965.
 Intensive Agriculture Area Programme -1965.
 High Yielding Varieties Programme -1967.
 Drought Prone Area Programme - 1971.
 Agriculture Technology Management Agency - 2000.

6. CONT…
Market-led agriculture :
 Started in kerala in the year 1993, as an experiment by combining SHGs
and market oriented production.
 The GOI in collaboration with MANAGE Hyderabad as successfully pilot
tested MLA with ATMA in 7 states and 28 districts.
 Some of the developments are,
AEZ, FIGS, Collective marketing,
AGMARKNET,
Rythu Bazaars (Rythara Santhe), RKVY
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7. OBJECTIVES OF M. L. A.
To conversion of Agriculture sector into profit oriented business.
To strengthening R-E-F linkages – between various departments at
various levels
To strengthening market linkages to farmers – IT application in
Agricultural marketing.
To wider use of electronic mass media for Agricultural Extension.
Source : GOI, (2007)

8. NEED FOR MARKET LED AGRICULTURE
Conversion of P-L-A into M-L-A.
Expansion of Market - more of agribusiness and trade.
Changing consumers preference-move towards HVCs.
Revolution in Information Communication Technology (ICT).
New trade opportunities within and outside the country.
Introduction of export oriented product.
Modernization of wholesale markets with new Agricultural policy.

9. ROLE OF EXTENSION PERSONS IN LIGHT OF MLA
Doing SWOT analysis.
Organization of Farmer Interest Groups (FIGs).
Enhancing the communication skills of farmers.
Establishing market linkages between farmers, markets and processors.
Helping in production and marketing plan.
Educating farmers about direct marketing.
Capacity building of FIGs.
Source: Reddy and Jaya, (2002)

10. DIMENSIONS OF M. L. A.
A
E B
DIMENSIONS
D C

11. INDIAN AGRICULTURAL WEB SITES
 www.agri.mah.nic.in
 www.agrinto.com
 www.ciks.org/agri.html
 www.khetiwadi.com
 www.kisan.net
 www.krishiworld.com
 www.nabard.org
 www.nic.in/agrico
 www.pravara.com
 www.ycmou.com/agri

12. REASONS FOR NON USAGE OF INTERNET
Among rural users in India
90% 84%
80%
70%
60%
50%
38%
40% 31% 31% 28% 28% 25%
30% 22%
20% 10%
10%
0%
Source : Internet and Mobile Association of India (IAMAI)

13. INSTITUTIONS FOR MLA
STATE AGRICULTURAL MANAGEMENT & EXTENSION TRAINING INSTITUTE
SAMETI, JHARKHAND
A State level Training Institute of Jharkhand

14. CONT…
ICAR (Indian Council of Agriculture Research).
NARSs (National Agriculture Research Systems ).
KVK (Krishi Vigyan Kendra).
NHB (National Horticulture Board)
SAMB (State Agriculture Marketing Boards ).
APEDA (Agri. & Processed food product Export Development Authority)

15. Objectives.
 To strengthen Research – Extension – Farmer linkages
 To increase the quality and type of technologies being disseminated.
 To develop new partnerships with the private institutions including NGOs.
Salient Features.
 Creating Farmer Advisory Committee to improve feed back.
 Using NGOs to organize farmers.
 Increased use of Information Technology (AGMARKNET, WWW)

16. ISSUES OF M.L.A.
Quality standards.
Marketing infrastructure building.
Bridging the information gap.
Direct marketing.
Specialized markets.
Involving corporates.
Source: GOI, (2007)

17. DIFF. BETWEEN ISSUES OF S.L.A. & M.L.A.
based on the pro-market explanations
ISSUES STATE-LED MARKET-LED
Supply-driven;
Demand-driven; self-
Beneficiaries beneficiaries state
selected
selected
Protracted; politically Quick; politically &
Pace and nature
& legally contentious legally noncontentious
Land prices Higher Lower
Privatized–
Statist-centralized;
Implementation decentralized;
transparency = low
method transparency = high
degree
degree

18. ISSUES STATE-LED MARKET-LED
Credit and Low credit supply & Increased credit and
investments low investments investments
Exit options None Ample
Cost of reform High Low
Farm development Farm development
Programme
plans after land plans before pace of
sequence
redistribution redistribution
Protracted, uncertain Quick, certain, and
Development and anaemic postland dynamic post-land
transfer development transfer development

19. POLICIES INITIATIVES
The National Agriculture Policy had highlighted the need for increase
in the private sector participation in farming by leasing private land for
agri-business & contract farming to private companies.
The government proposed to set up 20 Agri-Export zones in different
state that would integrate the complete process from production to
export stage & contract farming is being encouraged to rope in local
farmers to join these export zones as members to pool in their produce.
Source : Ramasamy et al, (2008)

20. PHASES IN AGRI. POLICY & DEVELOPMENT
GOVT. ACTION STATUS OF AGRI.
Extensive, low
Phase 1. Roads/ Irrigation Systems/ productivity agriculture
Establishing Research/ Extension/
the basics (Land Reforms)
Profitable intensive
technology. Wider uptake
inhibited by lack of
Phase 2. Reliable local seasonal inputs, finance & output
Kick starting finance, input & output markets
markets markets
Effective farmer input
demand & surplus prod.
Phase 3.
Withdrawal Effective private sector Larger volumes of
(non-agri.) markets finance & input demand
& produce supply
Source : Dorward, (2004)

21. NATIONAL AGRICULTURAL POLICY
Focus areas of policy document.
 Sustainable Agriculture.
 Food and Nutritional Security.
 Generation and Transfer of Technology.
 Input Management.
 Incentives for Agriculture.
 Investments in Agriculture.
 Institutional Structure.
 Risk Management.
 Management Reforms.
 Follow up Actions.
 Cooperative Sector Reforms.
Source: GOI, (2000)

22. FUTURE POLICY DIRECTIONS
 Completion of market reforms. (Min. of agriculture & state govt.)
 Promotion of supply chain infrastructure. (Various ministries)
 Promotion of grading, standardization and quality certification of farm
produce. (Min. of agriculture)
 Expansion of food processing facilities. (Min of FPI)
 Ensure farmer’s linkage with future market with price discovery and price
risk management. (Min. of CA. F. & PD)

23. MLA WORKS WITH DIFF. FARMING SYSTEMS
 Precision farming.
 Contract farming.
 Corporate farming.
 Cooperative farming.
 Integrated farming.

24. PRECISION FARMING
An application of technologies and principles to manage spatial and
temporal viability associated with all aspects of agriculture production.
(Pierce and nowak, 1999)
Objectives.
 To prepare the farmers for market led Horticulture/
Agriculture.
 To empower the Farmers and Farmers’ Forum.
 To promote Hi tech Agri. /Horticulture inbuilt with precision farming
elements.
 To be the model hi tech production system to maximize the productivity.

25. MEASURABLE OUT PUTS OF P.F.
 Enhancing the Productivity of crops by 50-60%.
 95 percent marketable produce .
 Water economy 30 to 40 %.
 Electricity economy 50 %.
 Less labor dependence.
 25% more weight per unit volume for the produce.
 Empowerment of farmers ( Technical, Economical and social
empowerment).
Source : Ajjan et al, (2008)

26. PROFITABILITY OF P.F.
No Crop Particulars Cost of Gross Marketing Net %
cultivation income cost (Rs) return increase
(Rs./ha) (Rs./ha) (Rs) in net
return
1 Cucumber Project farmers 51,579 1,20,000 12,000 56,421 221
Other farmers 49,960 75,000 7,500 17,540
2 Cabbage Project farmers 64,545 1,57,500 - 92,955 136
Other farmers 73,275 1,12,500 - 39,225
3 Chilli Project farmers 1,75,500 2,10,000 29,000 92,500 111
Other farmers 1,06,250 1,50,000 22,000 43,750
4 Potato Project farmers 84,100 2,10,000 5000 1,25,000 66
Other farmers 67,000 1,43,000 5000 76,000
5 Tomato Project farmers 2,58,280 95,971 13,068 1,49,241 62
Other farmers 2,00,304 96,430 11,824 92,051
Source : Ajjan et al, (2008)

27. PRECISION FARMING SUCCESS
STORIES
Snake guard’s height, 10 feet Brinjal: 500MT/ha, all India record
Carrot
Sugar cane 110 MT / acre (22 MT against 12 MT /ha)

28. Turmeric 3000 kg dry Vs 4500 kg dry. Banana double density. (6000 Plants/ha)
Workshop on precision vegetables. Service agency.

29. CONTRACT FARMING
Forward trade agreement between the producer and sponsor (buyer)
who may be processer or supplier / exporter.
Major States
Maharashtra, A.P., Karnataka, Punjab, Orissa, Tamil
Nadu, Madhya Pradesh etc.
Major Crops
Cotton, Soybean, Potato, Sugarcane, Basmati
Rice, Chilli, Spices, Medical Plants, Fruits and
Vegetables, Flowers, Poultry etc.
Major Sponsoring Agencies
Mahindra Shubhlabh, PepsiCo, United
Breweries, Dabur, Cadbury, Godrej, Himalaya Health
Care, ITC Agro-Tech etc.

30. COMPARATIVE STUDY OF COST & RETURN OF COTTEN
in CF & NCF (Rs per acre)
No Particulars CF NCF % Diff. to
CF over NCF
1 Preparatory cultivation. 1430 1290 10.58
2 Seeds & sowing. 196 374 -47.59
3 Manures. 1702 1490 14.23
4 Fertilizers. 2013 1499 34.32
5 Inter culture operations. 2325 2150 8.14
6 Plant protection. 4873 5595 -12.91
7 Picking cost. 1930 1755 9.97
8 Post harvest operations. 0 1800 -100
9 Total cost. 14469 15954 -9.31
10 Gross return. 32020 29705 7.79
11 Net return. 17551 13751 27.63
Source : Senthilnathan, (2008)

31. ADVANTAGES OF CONTRACT FARMING
WASTAGE ACROSS SUPPLY CHAIN
To the Farmers…
 Assured market price.
 Financial support in kind.
 Assured quality of seed and pesticides.
 Better price for producer.
 Elimination of middlemen.
 Remunerative returns and timely payment.
To the Buyers…
 Assured required supply.
 Assured required quality.
 Protection from fluctuation in market price.
 Buyer can plan on long term basis.

32. INTEGRATED FARMING
Productivity, Economics and Employment Generation of
Wetland Integrated Farming System.
Farming Productivity Production Gross Net BCR Per day Employment
systems (kg/ha) cost (Rs/ha) return return return generation
(Rs) (Rs) (Rs) (man days/
ha/yr)
Cropping 12995 27822 64975 37153 2.43 178 369
alone
Crop + 29609 48303 146035 97731 3.02 400 515
Fish +
Poultry
Crop + 29173 47090 145868 98778 3.06 400 515
Fish +
Pigeon
Crop + 37679 55549 186667 131118 3.36 511 576
Fish +
Goat
Source : Natarajan and Sudhalakshmi, (2008)

33. AGRICULTURE SUPPLY CHAIN
INDIA Trader Wholesaler Retailer
Consumer
Commission
Consolidator agent
Farmer
High wastage and low
margins
Consumer
DEVELOPED COUNTRIES Retailer
Wholesaler
Farmer
High investments –
Low wastage - better
margins

34. WASTAGE ACROSS SUPPLY CHAIN
Producer
Field Losses Developing
(e.g. Pest, Diseases, Rodents etc) Countries –
Pre-Processing Relatively
(e.g. inefficient harvesting, drying, milling) high losses in
the initial
Transport parts of the
(e.g. spillage, leakage) value chain
Storage
(e.g. technical deficiencies)
Rich
Processing & Packaging Countries
(e.g. excessive peeling, washing) – High
losses at a
Marketing later
(e.g. spoilage, rotting in stores) stage in
Consumer
Wastage by Consumer the value
(e.g. overeating, food wastage) chain
Field Source :MOFPI (2008-2009) Fork

35. STAGES IN A COMMODITY MARKETING SYSTEM
STAGES EXAMPALS
• Commodity buyers specializing in specific
1:Assembly agricultural products, such commodities as grain,
cattle, beef, oil palm, cotton, poultry and eggs, milk
• Independent truckers, trucking
2: Transportation companies, railroads, airlines etc.
• Grain elevators, public refrigerated
3: Storage warehouses, controlled atmosphere
warehouses, heated warehouses, freezer warehouses
Source : GOI, 2001 ( Draft )

36. STAGES EXAMPALS
4: Grading and • Commodity merchants or government grading
Classification officials
• Food and fiber processing plants such as flour mills,
5:Processing oil mills, rice mills, cotton mills, wool mills, and
fruit and vegetable canning or freezing plants
• Makers of tin cans, cardboard boxes, firm bags, and
6:Packing bottles for food packaging or fiber products
• Independent wholesalers marketing products for
7:Distribution and various processing plants to retailers (chain retail
retailing stores sometimes have their own separate
warehouse distribution centers)

37. STAGES IN PROMOTING MARKETING LED
Review stage.
Implementation.
Decision making & agreeing.
The marketing system.
Determining what market wants.
Audit of local resources.
Source: Sheela et al, (2008)

38. PARADIGM SHIFT FROM
P L A TO M L A
Aspects Production-Led Market-Led
Agriculture Agriculture
• Purpose or • Transfer of production • Enabling farmers to get
objective. technologies. optimum returns out of
the enterprise.
Expected end Delivery of messages. High returns.
results. Adoption of package of
practices by most of the
farmers.
Focus. Production / yields Whole process as an
”Seed to seed” enterprise /High Returns
”Rupee to Rupee”
Source: Reddy and Jaya, (2002)

39. Production-Led Market-Led
Aspects
Agriculture Agriculture
Extensionists’ Messages, Training / Joint analysis of the issues
interactions
Motivating Varied choices for adoption
Recommendations . Consultancy
Extensionists’ Limited to delivery mode Establishment of marketing
role and feedback to research and agroproccessing linkages
system between farmer groups
markets and processors
Maintenance of Very important as agriculture
Not much importance as the
Records focus was on production viewed as an enterprise to
understand the cost benefit
ratio and the profits generated

40. CHALLENGES TO MARKET LED EXTENTION
Gigantic size of extension system.
Information technology.
Market intelligence.
Extension cadre development.
Reorganization of extension system.
Source: Reddy and Jaya, (2002)

41. CHALLENGES IN RURAL MARKETING SYSTEM
Availability.
Affordability.
Acceptability.
Understanding the rural consumer.
Physical distribution.
Communication barriers.
Unauthentic arrival of products.
Source: Balaji et al, (2008)

42. TYPICAL QUESTIONS IN FARMER’S MIND
Market Led trying to change it

43. WE WANT SUPPORT
But not like this…..

44. CASE STUDY
Market-led Extension, an Experience with Rubber board in India
 The companies were importing rubber from other countries due to high
quality and low price.
 Local producers were in trouble .
 Factories was operating at low capacity utilization Capacity was 40
tonnes/day Were operating at 10 tonnes/day.
To tackle this situation,,,,,,,,,,,,,,
 Established Rubber Producer Societies (RPS).
 Linking gross root level organization like SHGs to processing factories.
 Trained the producers on producing high quality rubber.
 Created infrastructure facility.
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Source: Kumar, (2004)

45. Result....................
Result....................
 Productivity increased up to 40% .
 70% of rubber is processing now .
 20-30% increase in farmer income.
 Farmers realizing 90% of terminal market price.
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46. CASE STUDY
Market-led partnership - FIGs and Chitoor Poultry Association.
 Groundnut is the main crop in Chitoor.
 ATMA made diversification of the farmers into maize cultivation.
 Poultry association and FIGs were linked with buyback arrangements.
 ATMA conducted 22 awareness camps and 6 exposure visits to A.P.
 Poultry association provided 2 MT of poultry manure to networked farmers
free of cost.
Result................
 Crop diversification.
 Area expanded to 1150 hectares from 60 hectares.
 The average income from maize was raised to 20000 rupees.
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Source: Charyulu, (2007)

47. CONCLUSION
 The focus of the market led functionaries need to be extended
beyond production.
 Farmers should be sensitized on various aspects on
quality, consumer’s preference, market intelligence, processing
and value addition and other marketing information.
 With globalization of the market, farmers need to transform
themselves from producers-sellers in the domestic market to
producers cum sellers in a wider market sense to best realize the
high returns for the produce, minimize the production costs, and
improve the product value and marketability.
And at last………..

48. For listening me…….
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