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Agricultural Marketing & Agri-Business

Agencies Involved in Agricultural Marketing

The peculiar characteristics of agricultural produce such as small and scattered production, seasonality and persihability of products, transportation and communication etc. requires a large number of intermediaries between the producer and the ultimate consumer. All the agencies more or less participate in assembling and distribution of agricultural products.
Sometimes, agricultural commodities directly pass from producers to consumers. But in indirect marketing agricultural commodities generally move from producers to consumers through intermediaries or middlemen. The number of intermediaries may vary from one to many.


  • Producers

Most farmers or producers, perform one or more marketing functions. They sell the surplus either in the village or in the market. Some farmers, especially the large ones, assemble the produce of small farmers, transport it to the nearby market, sell it here and make a profit.

  • Middlemen

Middlemen are those individuals or business concerns which specialize in performing the various marketing functions and rendering such services as are involved in the marketing of goods.

Wholeselling is the one ion of goods is the wholesale dealers. Wholeselling is the one that covers activities of all individuals or businessmen, which sell to or negotiate sales with customers, who buy for resale or industrial use. His position is that of an intermediary between manufacturer and retailer.
Wholesalers are classified as

  1. Local wholesalers, who deliver their purchases to local retailer.
  2. Provincial wholesalers some time called as distributor selling to the retailers of a particular district or a state and
  3. National wholesalers located at a strategic place and distribute goods all over the country.

He is the last link in chain of middleman, who sells directly to consumer. He takes title to goods, sells and sets up business usually amidst the consumer's groups. He buys his requirement usually from the wholesalers. Retailers in producing areas may have direct contact with producers and buys goods from them for resale.

Co-operative Marketing Societies
Main function is that of commission agency i.e.

  • Selling the produce of member's.
  • They also undertake outright purchases.
  • Provide storage facilities for storage and grading and
  • Save cultivators from exploitation by traders and help farmers in getting fair price for their produce.
  • Performing functions of processing of raw produce.

Pucca Arhatias
He is the real purchase in the wholesale market on his own behalf of acting for some businessmen, firms in consuming markets. Big mills (rice, oils, cotton etc.) play as their agent and order him to purchase certain quantity within a given range of price. When pucca arhatia trades on his own, he dispose of his produce brought by him through dealers in different parts of country.

Katcha Arhatia
He also advances money to the cultivators and village banias on the condition that the produce will be disposed off through him alone and hence charges a very nominal rate of interest on the money advanced. Katcha arhatia charges commission for services rendered by him. Important link between the village cultivator or traders on the one hand.

Village Merchants
He is an important agency in the collection of produce and more so when the mando is situated at a considerable distance from the village. He advances from his shop either on credit or for exchange of foodgrain or so price given for cultivator's produce. The quantities of agril. Produce so collected are either disposed off in the mandi or retained for resale in the village in the processed forms, such as rice, flour, oil etc.

Intinerant Traders
They are small merchants, who move from village to village and buy the produce from cultivator's house. They give a lower price than selling in the nearby market and in setting transportation take into consideration, the factors such as cost of transportation, market charges and profit margin.

Transport Agency
This agency assists in the movement of the produce from one market to another e.g. railways, trucks, bullock carts, camel carts, tractor trolleys.

Communication Agency
It gives information about the prices prevailing, and quantity available and transactions e.g. post, telephone, telegraph, newspapers, radio.

Advertising Agency
It enables prospective buyers to know the quality of the product and decide about the purchase of commodities e.g. newspapers, radio, television, cinema slides.

They put produce for auction and bidding by the buyers.

Government Agencies / Institutions
In addition to individuals, corporate, co-operative and government institutions are operating in the field of agricultural marketing. Some important institutions are :-

The State Trading Corporation (STC)

  1. To make available supplies of essential commodities to consumers at reasonable prices on a regular basis;
  2. To ensure a fair prices of the produce to the farmers so that there may be an adequate incentive to increase production;
  3. To minimize violent price fluctuations occurring as a result of seasonal variations in supply and demand;
  4. To arrange for the supply of such inputs as fertilizers and insecticides so that the tempo of increased production is maintained;
  5. To undertake the procurement and maintenance of buffer stock, and their distribution, whenever and wherever necessary;
  6. To arrange for storage, transportation, packaging and processing;
  7. To check hoarding, black-marketing and profiteering.

The Food Corporation of India (FCI)

  1. To procure a sizable portion of marketable surplus of foodgrains and other agricultural commodities at incentive prices from the farmers on behalf of the Central and State Governments;
  2. To make timely releases of the stocks through the public distribution system (fair price shops and controlled items shops)
  3. To minimize seasonal price fluctuations and inter-regional price variations in agricultural commodities
  4. To build up a sizable buffer stock of foodgrains.
  • The National Agricultural Co-Operative Marketing Federation (NAFED)
  • Cotton Corporation India (CCI)
  • All India cotton co-operative federation limited
  • Jute corporation of India (JCI)
  • National dairy development board (NDDB)
  • National oilseeds and vegetable oils development (NOVOD) board
  • Tobacco board
  • Agricultural processed products and export development agency (APEDA)
  • Marine products export development agency (MPEDA)
  • The directorate of marketing and inspection,
  • Government of India
  • State level agricultural marketing departments and agricultural marketing boards
  • State and lower level co-operative marketing societies
  • Fair price shops
  • Consumers co-operative stores, milk unions

Source: http://www.indiaagronet.com/




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