Farmers Producer Organizations (FPOs) were launched in 2011-12 by the Department of Agriculture and Cooperation to collectivize small and marginal farmers. The goal was to mobilize about 2.5 lakh farmers into 250 FPOs across India. FPOs provide various services to members like input supply, procurement, packaging, marketing, insurance, and technical support to improve productivity and market access. Challenges in establishing FPOs include raising capital, mobilizing farmers, and gaining technical knowledge of relevant acts and regulations. Two examples provided are of an FPO in Tumkur district marketing unripe bananas for 24 farmers, and an FPO in Chitradurga district marketing

1. FARMER PRODUCER
ORGANIZATIONS

3. FPO
• Collectivization of producers, especially small and marginal
farmers into producer organizations.
• It has emerged as one of the most effective pathways to
address the many challenges of agriculture.
• Less investments , improved technology and inputs and
markets.

4. BACKGROUND
• Department of Agriculture and Cooperation (DAC),Ministry of Agriculture,
Government of India launched Farmer Producer Organisations (FPOs).
• During 2011-12, in partnership with state governments, which was
implemented through the Small Farmers AgribusinessConsortium (SFAC)
• The organisation involved the mobilisation of approximately 2.50 lakh farmers
into 250 FPOs (each with an average membership of 1000 farmers) across the
country, under scheme of the Rashtriya Krishi VikasYojana (RKVY).

6. Who can be the Initiator for establishing PC?
• An NGO working with the primary producers group and
willing to introduce the concept of ‘Producer Companies’
for the economic enhancement of the producers.
• Any person or group of persons.
• Any Government organization or department can also
promote Producer Companies.

7. • coconut is top priority and pomegranate the least.
• 40,000 hectares of potatoes in Karnataka are tie-up with
ITC(which manufactures Bingo) and Pepsi (Lays) can take
care of our entire potato crop.

8. OBJECTIVES
• Mobilising farmers into groups of between 15-20
members at the village level.
• Strengthening farmer capacity through agricultural
best practices for enhanced productivity.
• Ensuring usage of quality inputs and services for
intensive agriculture.
• Facilitating fair and remunerative markets including
linking of producer groups to marketing
opportunities.

9. Government intervention
• Government : 90 lakhs per permanent structures like cold
storage.
• Small Farmers Agriculture-Business Consortium (SFAC) will
give grant of Rs 10 lakh
• NABARD is committed to give each FPO Rs 5 lakh.

10. FPO SERVICE MODEL
• Financial Services: The FPO will provide loans for crops,
purchase of tractors, pump sets, construction of wells,
laying of pipelines.
• Input Supply Services: The FPO will provide low cost and quality
inputs to member farmers. It will supply fertilizers, pesticides, seeds,
sprayers,pumpsets, accessories,pipelines.
• Procurement and Packaging Services: The FPO will procure
agriculture produce from its member farmers, will do the storage,
value addition and packaging.

11. • Marketing Services: The FPO will do the direct marketing after
procurement of agricultural produce. this will enable members to
save in terms of time,transaction costs, weighment losses distress
sales, price fluctuations,transportation,quality maintenance etc.
• Insurance Services: The FPO will provide various insurance like
Crop Insurance, Electric Motors Insurance and Life Insurance.
• Technical Services: FPO will promote best practices of farming,
maintain marketing information system, diversifying and raising
levels of knowledge and skills in agricultural production and post-
harvest processing that adds value to products.

12. • Networking Services: Making channels of information(e.g. about
product specifications, market prices) and other business services
accessible to rural producers.
• Facilitating linkages with financial institutions, building linkages of
producers, processors, traders and consumers, facilitating linkages
with government programmes.

15. STARTUP OUTCOME

16. Challenges
• Raising share capital is the main challenge.
• Difficulty in convincing government.
• To mobilize farmers into community organizations is
very big task.
• It requires very high skills to convince individual
producers / growers to form organizations.
• Legal and technical knowledge about Acts and
Regulations.

17. Output Marketing of Banana by Hemavathy HFPCL, Gubbi,
Tumkur District
• Market linkages established for Unripe Banana fruits
• Farmers benefited/covered out of this linkage is 24
• Benefits:The number of FPO members are getting margins of 3-
5%, transportation is saved and commission charges are lesser.
• Local buyers buy the produce.
• Impact:The FPO is acting as collection aggregator, where they
procure bananas from share holder at an average price of 25 Rs
from farmers every day. The Local buyers contact the FPO and
buys the Banana produce at the price 3-5% more of margin than
Local markets.
• CEO- Chandrashekar, Contact number – 9740161407

18. • 35 farmers involved in this organisation.
• Benefits: they got a margin of 15-20% higher than the local
market price.
• Benefits for FPO:FPO got benefit of Rs.20 /Quintal as service
charge.FPO played role of aggregator.
• Buyer:Kissan Networks Private Limited.
• The impact:FPO acting as a collection centre. they have sold
62 Tons of onion.
• CEO:Pradeep, Contact Number-+919743068215
Output Marketing of Onions by Ramalingeshwara HFPCL, Hosadurga
Taluk, Chitradurga Distsrict