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AN ASSESSMENT OF MARKETING MARGINS IN DIFFERENT MARKETING CHANNELS FOR VEGETABLE CROPS IN SOLAN DISTRICT(H.

P)

PROJECT REPORT
SUBMITTED BY: NARESH THAKUR (H-2009-MBA-17) Submitted in partial fulfilment of the requirements for the degree of MASTER OF BUSINESS ADMINISTRATION

(AGRIBUSINESS) (20092011)

DEPARTMENT OF BUSINESS MANAGEMENT COLLEGE OF HORTICULTURE Dr. Yashwant Singh Parmar University of Horticulture & Forestry

Nauni, Solan (HP) 173230


Dr. Manoj Department of Social Sciences, Associate Professor Y.S. Parmar University of Horticulture and Forestry, Nauni, Solan (H.P.)-173230 Kumar Vaidya Dr.

CERTIFICATE-I
This is to certify that the project entitled An Assessment of Marketing Margins in different Marketing Channels for Vegetable Crops in Solan District (H.P.) has been submitted to Dr. Yashwant Singh Parmar University of Horticulture and Forestry, Nauni, Solan (H.P.) by Naresh Thakur (H-2009-MBA-17) in partial fulfilment of Master of Business Administration (Agribusiness) programme. This project has been done under my guidance and no part of this work has been submitted for any other degree or diploma. The assistance and help received during the course of investigation and source of literature has been fully acknowledged.

Place: Project Advisor Dated:

Nauni,

Solan

CERTIFICATE-II
This is to certify that the project entitled An Assessment of Marketing Margins in different Marketing Channels for Vegetable Crops in Solan District (H.P.) has been submitted to Dr. Yashwant Singh Parmar University of Horticulture and Forestry, Nauni, Solan (H.P.) by Naresh Thakur (H-2009-MBA-17) in partial fulfilment of MBA (Agribusiness) programme. This project has been approved by the examination committee after conducting an oral examination in collaboration with the external examiner.

Project External Examiner

Advisor

Head of the Department

Dean

College of Horticulture, UHF, Nauni, Solan

CERTIFICATE-III
This is to certify that all the corrections pointed out by the external examiner have been incorporated in the project report entitled An Assessment of Marketing Margins in different Marketing Channels for Vegetable Crops in Solan District (H.P) submitted to Dr. Yashwant Singh Parmar University of Horticulture and Forestry, Nauni, Solan (H.P.) by Mr. Naresh Thakur (H-2009MBA-17) in partial fulfilment of the requirement for the degree of Master of Business Administration (Agribusiness).

(Dr. Manoj Kumar Vaidya) Project Advisor

(Dr. Y.S. Negi) Professor & Head Department of Business Management

ACKNOWLEDGEMENT
It grants me immense pleasure to extent my sincere thanks and a deep sense of gratitude to Dr. Manoj Kumar Vaidya, Associate Professor, Project Advisor for his valuable and thorough guidance, concrete suggestions, keen interest, constructive criticism during the entire course of studies.

I owe a deep sense of gratitude to Dr. Y. S. Negi (Professor and Head of the Department of Business Management), Dr. Piyush Mehta (Assistant Professor), and Dr. Kapil Kathuria (Assistant Professor) department of Business Management.

It is my privilege to extend thank to the farmers, wholesalers, commission agents, contractors, retailers who spend their invaluable time in filling up the schedule.

I acknowledge with thanks the help received and a nice company during my study period of my friends Prasoon, Ankit, Ravi, Ankur, Ankush, Suresh.

At the last but not the least, I would like to put on record my deep sense of gratitude to my worthy Parents, Brother and sister, whose inspiration, encouragement, love and affection made my present work quite effective.

Naresh Thakur

CONTENTS
Chapter No. 1. Introduction Need and Objectives of the study 2. 3. 3.1 3.2 3.3 3.4 4. 4.1 4.2 4.3 4.4 4.5 4.5.1 Review of Literature Research Methodology Selection of study Area Sampling Design Collection of Data Analytical Framework Results and Discussions Distribution of Area under Vegetables Marketing Channels for vegetable crops Marketable Surplus of selected vegetables 5-7 8-10 8 8 9 9-10 11-52 11 13 14 Title Page No. 1-4

Marketing Channels for selected vegetables in the study 21 area Marketing costs, Margins and Price Spread Price spread in marketing of selected vegetable crops through channel-I 28-33 25-48

4.5.2

Price spread in marketing of selected vegetable crops through channel-II 33-39

4.5.3

Price spread in marketing of selected vegetable crops through channel-III 41-48 49-52 53-55 56-57 I-V

4.6 5. 6.

Problems in vegetable marketing Summary and conclusions Bibliography Appendices

LIST OF TABLES
Table 3.1 4.1 4.2 4.3 4.4 4.5 4.6 4.7 4.8 4.9 4.10 Area-wise sample farmers Distribution of area and production under selected vegetables Marketing channels followed by vegetable growers in the study area Per farm marketable surplus of French bean Per farm marketable surplus of ladys finger Per farm marketable surplus of brinjal Per farm marketable surplus of cauliflower Per farm marketable surplus of tomato Per farm marketable surplus of peas Marketing channels used for tomato in the study area Marketing channels used for peas in the study area Title Page (s) 8 12 14 15 16 17 18 19 20 22 23

4.11 4.12 4.13 4.14 4.15 4.16 4.17 4.18 4.19 4.20 4.21 4.22 4.23 4.24 4.25 4.26 4.27 4.28 4.29 4.30 4.31 4.32 4.33

Marketing channels used for cauliflower in the study area Marketing channels used for French bean in the study area Marketing channels used for ladys finger in the study area Marketing channels used for brinjal in the study area Price spread for tomato in channel-I Price spread for peas in channel-I Price spread for cauliflower in channel-I Price spread for French bean in channel-I Price spread for ladys finger in channel-I Price spread for brinjal in channel-I Price spread for tomato in channel-II Price spread for peas in channel-II Price spread for cauliflower in channel-II Price spread for French bean in channel-II Price spread for ladys finger in channel-II Price spread for brinjal in channel-II Price spread for tomato in channel-III Price spread for peas in channel-III Price spread for cauliflower in channel-III Price spread for French bean in channel-III Price spread for ladys finger in channel-III Price spread for brinjal in channel-III Multiple response of vegetable growers related to problems faced in the market Multiple response of vegetable growers related to problems of financing Multiple response of vegetable growers related to market information Multiple response of vegetable growers related to problems faced in getting market-related information

23 24 24 25 28 29 30 31 32 33 35 36 37 38 39 40 43 44 45 46 47 48

50 50 51

4.34 4.35 4.36

52

LIST OF FIGURES
Figure 1. 2. 3. 4. Title Total area under selected vegetables in sampled villages Total production under selected vegetables in sampled villages Marketable surplus of vegetables per farm Marketing channels followed by vegetable growers for selected vegetable crops Producers share in consumer rupee for the selected vegetable crops in channel-I Marketing efficiency of selected vegetables in channel-I 6. 7. Producers share in consumer rupee for the selected vegetable crops in channel-II Marketing efficiency of selected vegetables in channel-II 8. 9. Producers share in consumer rupee for the selected vegetable crops in channel-III Marketing efficiency of selected vegetables in channel-III 42 10. 42 26 27 Page (s) 11 13 15

22

5.

34 34

CHAPTER I INTRODUCTION

CHAPTER 1
INTRODUCTION
Vegetable growing is a profitable activity on the one hand and an essential part of the human diet on the other. Another important feature of the vegetable is that these can be grown on a small land holding for self-consumption in kitchen gardens as well as for commercial purposes in the field and polyhouses. Due to the high value cash crops vegetable cultivation is becoming lucrative vocation in the farming community. The vegetable production in India has touched a new height in recent years, placing it as the second largest producer of vegetables in the world, next only to China (Kumar et al., 2004). The growing population and improving economic status in the country have increased vegetable consumption both across regions and different income groups (Kumar and Mathur, 1996; Kumar, 1998). The vegetables demand is expected to grow further, requiring the production of 185 million tonnes by 20112012 (Singh et al., 2004). In India, vegetables have enormous potential in providing employment and nutritional security, as our biodiversity in vegetables is very wide and supportive. Being seasonal, the production of vegetables in India is highly localized in favoured agro-climatic regions and has been identified as the most viable option for replacing subsistence farming, particularly in the hills (Kumar et al., 2002).

Indian hills are bestowed with internal viability and multiplicity of highly localized and complex agro-systems, suitable for cultivation of several important vegetable crops. The natural niche and other favourable conditions of Himachal Pradesh provide a vast potential of producing vegetables both normal and off-season, and could make the produce regularly available to the neighbouring plains. Within the state, Solan district is an important vegetable growing area in Himachal Pradesh due to irrigation facility (Khuls, ponds, wells), temperature suitability, fertile land and high demand. The district has made a commendable progress in vegetable production especially tomato (67,200 MT in 2001) and mushroom, besides producing commercial crops viz., potato, green peas, beans, caulifower, cabbage, cucurbits and capsicum. Total area under vegetables during the year 2006-07 was 7629 Ha in district Solan producing about 186921 MT of vegetables. In addition to Kharif and Rabi vegetables onion, garlic, coriander and chillies are also produced in the area. The acreage under vegetable cultivation has shown a significant increase of about 271% during past four decades in Solan district (Saraswat and Sharma, 2008). This scenario indicates that vegetables cultivation has considerable potential in improving the economic status of farming community in the region. Marketing is an important activity of vegetable production system particularly due to the perishable nature of the crop. An efficient marketing system is essential for maintaining reasonable farm prices and keeping consumer prices at relatively accessible level. The various studies shows that the growing development and commercialization of the horticulture sector in the district has highlighted the inadequacies of the existing agricultural marketing system. This shows that the system is not yet geared to meet the requirements of a modern developing agricultural economy. There are various reasons put forward that the system is exploitative, collusive and economically inefficient and operates with high profit margins. Due to lengthy and complex marketing channels, the marketing costs are high and vegetable producers suffer tremendous economic losses. The common perception is that marketing margins are very high, which diminish the return of the vegetable growers. The technical breakthrough in Indian Agriculture has brought about a spectacular increase in crop yield levels. This has generated the problem of marketing for which adequate attention has not been paid. Even though it is recognized that solution of this problem is a pre-condition for overall agricultural prosperity for the farmer, with the

commercialization of agriculture, disposal of surplus produce is as important as adoption of new farm practices. Increased production in any sphere is of no economic significance unless this is efficiently marketed. Efficient marketing improves the share of producer in consumers rupee beside incentive to the cultivators to enhance their production. The demand for vegetables is increasing at a very fast rate resulting from increasing population and an increase in per capita income. Vegetable production offers great potentialities of generating more income and employment in per unit of area and per unit of time due to their short duration. Marketing is more important in case of vegetables; it differs from other crops like cereals, pulses and oil seeds because of their high perishability, concentration of trade in a few hands and production by large number of growers on small areas. Moreover, vegetables cannot be grown in all parts of the country due to climatic variations and seasonality of production. The produce has to be transported from one place to another as quickly as possible. The considerable quantity of produce goes waste because of losses during post-harvest operations. The extent of post-harvest losses mainly depends upon the nature of the produce, distance between producing and consuming centres, mode of transportation, management of the farm etc.

Need of the study


A study of the vegetable marketing system is necessary to understand the complexities involved and to identify the bottlenecks with a view to providing efficient services in the transfer of farm products and inputs from producers to consumers. An efficient marketing system minimizes costs and benefits all sections of society. Marketing margins tends to be higher for perishables like fruits and vegetables. Whereas marketing margins provide an understanding of the spread between the producer and the consumer prices. Marketing costs can reveal inadequacies in the existing marketing structure and suggest, for example, the need for greater vertical integration of marketing functions, by reducing the number of intermediaries and improving services. The farmers have not been able to fully exploit the resources mainly because of illiteracy and unorganization. They face various difficulties during marketing of produce. Transportation of produce is mainly taken by private sector, which at times is not available in time and is costly. This has lead to delayed sale and higher post-harvest losses of the produce. Disposal pattern is also complicated as large numbers of agencies are involved in marketing. Growers face exploitation by the middlemen. The cultivators have been selling their produce

directly in the market or through post-harvest contractors, commission agents and wholesalers etc. The growers get different prices through different agencies, while the cost of selling is also different. On this account, this study is designed to investigate the vegetable growers share in consumer rupee and also sort out shares of various middlemen involved in marketing process. It also analyses the costs incurred at various steps of marketing process and highlights the marketing bottlenecks of vegetable growers, beoparies, commission agents/hawkers, wholesalers and retailers, with the following specific objectives:

Objectives
1. To identify the marketing channels of selected vegetables in Solan district of Himachal Pradesh. 2. To study the margins and costs of intermediaries at various levels/stages of vegetable marketing.
3. To workout the bottlenecks in the vegetable marketing system and suggest and

recommend policy guidelines for improving vegetable marketing.

CHAPTER II REVIEW OF LITERATURE

CHAPTER 2
REVIEW OF LITERATURE
Baba, Wani and Yousuf (2010) assessed marketed surplus and price spread of vegetables in Kashmir valley using multistage-stratified random sampling. Computation of marketing efficiency was done using corrected marketing efficiency measure formulated by Acharaya and Aggarwal in 2001. It highlighted the fact that spoilage in the marketing of vegetables had affected the marketing margins as well as marketing efficiency. Saraswat, Singh and Sharma (2008) observed that the share of area under vegetables crops increased by 271% during four decades in Solan district. It signifies to the fact that the people here are enhancing their farm income through commercialisation of vegetable crops. Singh and Chauhan (2004) conducted a study on marketing of vegetables in Himachal Pradesh and identified four marketing channels which mainly exist in the area viz., Channel I: Producer Channel II: Producer Channel III: Producer Consumer Channel IV: Producer Consumer The marketing efficiency was found to be maximum for all the selected vegetables (tomato, brinjal, peas, cauliflower) in channel-I and minimum in channel-III. The marketing margins of wholesalers were observed to be the highest (17%) for tomato Commission agent Wholesaler (distant market) Retailer Retailer Consumer Consumer Retailer

Wholesaler/Commission agent (Local market)

and the marketing margins of retailers was the highest (19.03%) in case of cauliflower in channel-III. Singh (2004) conducted a study on marketing of vegetables in Madhya Pradesh and stressed on the fact that an efficient marketing system minimizes costs and benefits all sections of the society. The producers share was estimated to be in the range of 50 to 67 per cent and the rest went to middlemen. Further it was suggested that latters share needs to be reduced in such a way, that it provides better remuneration to the producer without affecting the vegetable marketing business adversely. Gajanana and Sudha (2004) studied the post-harvest losses, including those in transportation and marketing and concluded that high post-harvest losses resulted in lower per-capita availability of vegetables. K. S. Birari, D. S. Navadkar and J. T. Dorge (2004) observed the marketing efficiency of cole vegetables such as cabbage, cauliflower in Western Maharashtra. In the case of cole vegetables nine types of marketing channels were identified. Kumar et al., (2004) reported that the local markets for vegetables were thin and trading in distant markets was non-remunerative due to high transportation costs. V.M. Chole, J.M. Talathi and V.G. Naik (2003) conducted a study to assess the price spread in marketing of brinjal in Maharashtra state. Three marketing channels were identified viz., producer producer wholesaler wholesaler retailer retailer retailer consumer, commission agent consumer, and producer

consumer. The channel-II was most favoured channel in

the study area as maximum (nearly 50%) quantity was sold through this channel. It was also observed that the producer share in consumers rupee was maximum in channel-I (68.28%), followed by channel-II (57.94%) and channel-III (53.14%). It is revealed that the marketing efficiency was higher in channel-I (2.25%) followed by channel-II (1.37%) and channel-III (1.13%). A.V.Gadre, J.M.Talathi and S.S. Wadekar (2002) estimated the price spread in marketing of white onion in Raigad district of Maharashtra. Four marketing channels were identified for white onion. The producer share in consumers

rupee was highest in case of channel producer to consumer (98.85%) and lowest (65.60%) in channel producer to wholesaler to consumer. Ajay Verma, Sudhir Kumar and P.M. Singh (2002) conducted a study on marketing and export of fresh vegetables. The study reveals that only 1% of the vegetable output was being processed commercially. He further stated that the prices of vegetables fluctuate frequently and often fall drastically during harvesting, hampering efforts of growers. EDA Rural Systems Pvt. Ltd., Gurgaon (2001) in a research on tomato cultivation in Himachal Pradesh shows that the Solan district has 46% ( 67,200 metric tonnes) contribution to states total tomato production of 1,44,900 metric tonnes. Alam (2001) observed through his studies that the vegetable cultivation was capital intensive and production risks were very high. Subramanian et al., (2000) reported that about 90-98% of the vegetables were sold and used afresh, except some roots and tubers. Chattaopadhyay and Sarkar (1994) in their study that revealed the middlemen were exploiting farmers and big marketing margins existed for agricultural commodities ranging from about 10 to more than 80 per cent.

CHAPTER III RESEARCH METHODOLOGY

CHAPTER 3
RESEARCH METHODOLOGY 3.1 Selection of the study area

Solan district of Himachal Pradesh was purposively selected for the present study because out of twelve districts of the state Solan district ranks first in area under vegetable crops. The climatic conditions of the district are most congenial for vegetable production especially tomato. The Saproon and Doon valley of the district are well known for off season vegetable and quality seed production. Moreover, marketing structure for vegetables is comparatively well developed in the district.
3.2

Sampling design

For the selection of ultimate sample of respondents from the selected district multi-stage random sampling technique was used. Out of the total five developmental blocks in the district one block with largest area under vegetable cultivation was selected. The Solan block had the largest area under vegetables and hence selected for the present study. In the next step, a list of villages with acreage under vegetable crops was prepared and five villages with the highest acreage under vegetable crops were selected viz., Damrog, Shamti, Oachghat, Nauni, and Deonthi respectively. In the next step, a list of all the vegetable growers was prepared and ten respondents from each village were randomly selected which constituted a total number of fifty growers to collect the primary data. For the collection of data from market functionaries, a random sample of ten each of wholesaler, commission agent, and retailer constituting a sample of thirty market functionaries was taken pertaining to the study.

Table: 3.1 Area-wise sample farmers


Village covered (study area) Damrog Shamti Oachghat Nauni Deonthi No. of farmers (sample size) 10 10 10 10 10

3.3

Collection of data

Both primary and secondary data was collected and used for the proposed study. Primary data was collected through pre-tested questionnaires from producers of vegetables, commission agents, wholesalers and retailers. The questionnaire included both open-ended and closeended questions. The information sought included sales price, harvesting cost, packing cost, packing materials cost, transportation costs, commission agent fee and market-committee fee. Personal interview method was used to collect the data. Secondary data was collected from all published sources viz., Department of Agriculture, Horticulture, Market Committee, reports of National Horticulture Board and relevant websites etc.

3.4 Analytical framework 3.4.1 Marketing margins


Marketing margins of each marketing channel were calculated as: a. Producers share in the consumer rupee Ps = (Pf/Pr) * 100 Where, Ps = producers share/ unit, Pf = price received by the farmer/producer at the time of first sale of per unit produce, and Pr = retail price per unit produce. b. Middlemens share in the consumer rupee To calculate the middlemens share in the consumer rupee, the following measure was used: Pmi = [{Pri (Ppi + Cmi)} / Pri] * 100 Where, Pmi = percent margin of middlemen per unit produce, Pri = sale/retail price per unit produce, Ppi = purchase price per unit produce, and Cmi = marketing cost per unit produce.

3.4.2 Marketing efficiency (M.E)


M.E. = (value added by marketing/ cost of marketing) * 100

3.4.3 Multiple response percentage Method


P= (X / Y)* 100 Where P is percentage, X is the individual factor, and Y is the sum total of factors.

CHAPTER IV RESULTS AND DISCUSSIONS

CHAPTER 4

RESULTS AND DISCUSSIONS


In the study area the observations were made to identify the major vegetable crops among different vegetables grown based on the acreage and production under the particular crop. Hence, six crops viz., tomato, peas, cauliflower, French bean, ladys finger, and brinjal were selected for the detailed study. The results shows that out of six selected vegetables in five villages cauliflower was not commercially grown in Oachghat and ladys finger in Shamti village respectively.

4.1 Distribution of area and production under vegetables


The area under different selected vegetables and their production by the sampled growers was analysed and presented in table 4.1. The table reveals that on overall basis French bean accounted for highest acreage of 30 acres among different vegetable crops, followed by tomato (25.4), brinjal (22.3), ladys finger (17.6), peas (17.4), and cauliflower (15.1) acres respectively. Among the sampled villages ladys finger occupied 39.77 per cent in Damrog village followed by French bean (37.33%), tomato (27.55%), peas (24.13%), brinjal (13.45%), and cauliflower (6.62%) respectively. Among the sampled villages French bean occupied the highest acreage of 23.47 per cent followed by tomato (19.87%), brinjal (17.44%), ladys finger (13.77%), peas (13.61%), and cauliflower (11.81%) (Fig.1).

Similarly, production under selected villages was assessed and it was estimated that on overall basis French bean accounted for highest production of 316 quintals followed by tomato (261.5), brinjal (229.0), peas (180.2), ladys finger (166.5), and cauliflower (160.3) quintals respectively. The production under all the selected vegetables for sampled villages was found to be highest for village Deonthi (369.8 q) followed by Damrog (344.5 q), Oachghat (230.5 q), Nauni (186.7 q), and Shamti (182.0 q). On an overall basis among the sampled villages French bean accounted for 24.05 per cent of total production followed by tomato (19.90%), brinjal (17.43%), peas (13.71%), ladys finger (12.67%), and cauliflower 12.20 per cent respectively (Fig. 2).

4.2 Marketing channels for vegetable crops

The following marketing channels were prevalent in the study area: Channel I: producer Channel II: producer Channel III: producer Retailer consumer consumer retailer consumer

wholesaler/commission agent (local/distant market)

The area wise marketing channels followed by the vegetable growers are presented in table 4.2. It reveals that in all the selected five villages the growers preferred channel-III the most for marketing their produce followed by channel-II, and channel-I. The highest number of growers 24.24 per cent preferred to market their produce through channel-III in Nauni followed by Damrog (22.21%), Deonthi (21.21%), Shamti (18.18%), and Oachghat (15.15%). It was also observed that channel-II was most followed by growers of Oachghat (50.00%) whereas channel-I was found to be most followed by growers of Deonthi (33.33%) to dispose their produce.

Table: 4.2 Marketing channels followed by the vegetable growers in the study area
(in percent) S.No. Area /villages Farmers adopting marketing channel Channel-I 1. 2. 3. 4. 5. Damrog Shamti Oachghat Nauni Deonthi 22.22 22.22 11.11 11.11 33.33 Channel-II 12.5 25.0 50.00 12.50 ---------Channel-III 22.21 18.18 15.15 24.24 22.21

4.3 Marketable surplus of selected vegetables


A marketable surplus of vegetable produce refers to the quantity of produce which is available for marketing after meeting family and self consumption requirements, wage payment to labourers, gift and donations at growers level. This is expressed as MS= P-C, where MS = marketable surplus, P = total production and C = total

requirements. Table 4.3-4.8 depicts the marketable surplus of selected vegetables per farm. It indicates that about 2-5 per cent of total vegetable produce was exhausted at growers level for various purposes and the rest, up to 95-98 per cent was available as marketable surplus with the grower. On percentage basis maximum and minimum marketable surplus per farm were observed for peas (97.67%) and cauliflower (95.32%) respectively. Similarly, marketable surplus per farm in quintals was observed to be highest for French bean (30.69 quintals) followed by tomato (25.35), brinjal (22.30), peas (17.60), ladys finger (17.05), and cauliflower (15.28) quintals respectively (Fig. 3).

Table: 4.3 Per farm marketable surplus of French bean


S.No. 1. 2. Utilization of the produce: a. Home consumption 0.43 (1.36) b. Payments in kind 0.16 (0.51) c. Quantity spoiled 0.32 (1.01) Sub-total 0.91 (2.88) 3. Marketable surplus 30.69 (97.12) Figure in parenthesis show percentages to total production Particulars Total Production Quintals (q) 31.6

Table: 4.4 Per farm marketable surplus of ladys finger


S.No. Particulars 1. 2. Utilization of the produce: a. Home consumption 0.44 (2.48) b. Payments in kind 0.12 (0.68) c. Quantity spoiled 0.14 (0.79) Sub-total 0.70 (3.94) 3. Marketable surplus 17.05 (96.05) Figure in parenthesis show percentages to total production Total Production Quintals (q) 17.75

Table: 4.5 Per farm marketable surplus of brinjal


S.No. 1. 2. Utilization of the produce: a. Home consumption 0.30 (1.31) b. Payments in kind 0.10 (0.43) c. Quantity spoiled 0.20 (0.87) Sub-total 0.60 (2.62) 3. Marketable surplus 22.3 (97.38) Figure in parenthesis show percentages to total production Particulars Total Production Quintals (q) 22.9

Table: 4.6 Per farm marketable surplus of cauliflower


S.No. 1. 2. Utilization of the produce: a. Home consumption 0.39 (2.43) b. Payments in kind 0.09 (0.56) c. Quantity spoiled 0.27 (1.68) Sub-total 0.75 (4.68) 3. Marketable surplus 15.28 (95.32) Figure in parenthesis show percentages to total production Particulars Total Production Quintals (q) 16.03

Table 4.7: Per farm marketable surplus of tomato


S.No. 1. 2. Utilization of the produce: a. Home consumption 0.53 (2.02) b. Payments in kind 0.06 (0.22) c. Quantity spoiled 0.21 (0.80) Sub-total 0.80 (3.05) 3. Marketable surplus 25.35 (96.94) Figure in parenthesis show percentages to total production Particulars Total Production Quintals (q) 26.15

Table: 4.8 Per farm marketable surplus of peas


S.No. 1. 2. Utilization of the produce: a. Home consumption 0.25 (1.39) b. Payments in kind 0.10 (0.55) c. Quantity spoiled 0.07 (0.39) Sub-total 0.42 (2.33) 3. Marketable surplus 17.6 (97.67) Figure in parenthesis show percentages to total production Particulars Total Production Quintals (q) 18.02

4.4 Marketing channels for selected vegetables in the study area


The number of growers and quantity sold by them of different vegetables through various marketing channels were analysed and presented in tables 4.9 to 4.14. The data reveals that the growers who sold their vegetables through channel-I ranged between 5 to 18 per cent while vegetables marketed through this channel ranged between 0.63 to 15.78 per cent. The maximum was found in case of peas. In case of channel-II the percentage of vegetable growers who opted this channel ranged between 6 to 32 per cent and selected vegetables sold through this channel ranged between 2.17 to 26.84 per cent. The maximum quantity of cauliflower (26.84%) sold through channel-II by the maximum number of vegetable growers (14). Channel-III was found to be the most important channel in the marketing of selected vegetables, because maximum number of vegetable growers opted this channel and also maximum selected vegetables was disposed of through this channel. The percentage of vegetable growers who followed channel-III ranged between 68 to more than 85 per cent (Fig. 4) and selected vegetables sold through this channel ranged from 57 to more than 95 per cent. Maximum (96.68%) produce of peas sold through this channel followed by ladys finger (95.35%), tomato (94.40%), brinjal (91.18%), French bean (83.94%), and cauliflower (57.37%) respectively. Maximum quantity of produce sold by vegetable growers through various marketing channels for six selected vegetables was found to be about 1108 q in case of tomato followed by brinjal about 1080 q, cauliflower about 950 q, ladys finger about 792 q, peas about 783 q, and French bean about 346 q respectively.

Table: 4.9 Marketing channels used for tomato in the study area

S.No. 1.

Channel Producer consumer

Grower (No.) 3 (6.00)

Produce sold (q) 7.00 (0.63) 55.01 (4.96) 1046 (94.40) 1108.01 (100)

2.

Producer

retailer

consumer

7 (14.00)

3.

Producer agent Total

wholesaler/commission retailer consumer

40 (80.00) 50 (100)

Figure in parenthesis shows percentage to the total

Table: 4.10 Marketing channels used for peas in the study area
S.No. 1. Channel Producer consumer Grower (No.) 5 (10.00) 2. Producer retailer consumer 3 (6.00) 3. Producer commission agent consumer Total wholesaler/ retailer 42 (84.00) 50 (100) Figure in parenthesis shows percentage to the total Produce sold (q) 9.00 (1.14) 17.00 (2.17) 756.84 (96.68) 782.84 (100)

Table: 4.11 Marketing channels used for cauliflower in the study area

S.No. 1.

Channel Producer consumer

Grower (No.) 9 (18.00)

Produce sold (q) 150.00 (15.78) 255.00 (26.84) 545.02 (57.37) 950.02 (100)

2.

Producer

retailer

consumer

7 (14.00)

3.

Producer agent Total

wholesaler/commission retailer consumer

34 (68.00) 50 (100)

Figure in parenthesis shows percentage to the total

Table: 4.12 Marketing channels used for French bean in the study area
S.No. 1. Channel Producer consumer Grower (No.) 4 (8.00) 2. Producer retailer consumer 16 (32.00) 3. Producer agent consumer Total wholesaler/commission retailer 30 (60.00) 50 (100) Produce sold (q) 9.00 (2.61) 46.50 (13.45) 260.10 (83.94) 345.60 (100)

Figure in parenthesis shows percentage to the total

Table: 4.13 Marketing channels used for ladys finger in the study area
S.No. 1. Channel Producer consumer Grower (No.) 7 (14.00) 2. Producer retailer consumer 5 (10.00) 3. Producer agent Total wholesaler/commission retailer consumer 38 (76.00) 50 (100) Figure in parenthesis shows percentage to the total Produce sold (q) 12.20 (1.54) 25.00 (3.16) 762.00 (96.18) 792.20 (100)

Table: 4.14 Marketing channels used for brinjal in the study area
S.No. 1. Channel Producer consumer Grower (No.) 3 (6.00) 2. Producer retailer consumer 4 (8.00) 3. Producer agent wholesaler/commission retailer consumer 43 Produce sold (q) 35.00 (3.24) 60.20 (5.57) 984.70

(86.00) Total 50 (100) Figure in parenthesis shows percentage to the total

(91.18) 1079.90 (100)

4.5 Marketing costs, margins and price spread


Price spread in relation to agricultural commodities refers to the difference between the prices paid by the ultimate consumer and price received by the grower for an equivalent amount of farm produce. The price spread consists of marketing costs and margins of intermediaries. It is a method which indicates as to how much is actually received by the producer out of every rupee that is spent by the consumer and what portion goes into the coffers of intermediaries for the performance of their functions. The study of price spread carries importance in the sense that, if goods could be move from producers to consumers desires, the marketing system would said to be efficient. Reduction in the cost of performance of various marketing functions and improving the standard of service with the same or lower cost represents a clear case of marketing efficiency.

Channel-I:
The marketing costs and price spread for major vegetable crops produced in study area were analyzed for different marketing channels, the results of which are presented in table 4.15 to 4.20. The data reveals that in case of channel-I (producer consumer), the producers share in the consumers rupee was found to be higher (94.50%) in case of ladys finger followed by peas (92.70%), French bean (92.63%), tomato (90.86%), cauliflower (90.60%), and brinjal (88.53%) respectively. Further, it revealed that the producers were receiving in the range of 88 to 95 per cent of consumers rupee in different vegetables (Fig. 5). Net price received by growers was found maximum in ladys finger and lowest in case of brinjal. Marketing costs incurred by the producer were found to be maximum Rs. 82.25 per quintal in case of tomato followed by brinjal (Rs. 80.25), cauliflower (Rs. 75.25), peas (Rs. 73.00), French bean (Rs. 72.25), and ladys finger (Rs. 63.25) respectively. Marketing efficiency was found to be highest in case of ladys finger (17.18%) followed by peas

(12.70%), French bean (11.56%), cauliflower (10.07%), tomato (9.94%), and brinjal (7.72%) respectively (Fig. 6). This indicates that an increase in acreage under ladys finger can enhance the farm income of the growers.

4.5.1 Price spread in marketing of selected vegetable crops through channel-I Table: 4.15 Price spread for tomato
S.No. Functionary Rs./q (%age of consumers price) 1. Net price received by the producer 817.75

(90.86) 2. Marketing cost incurred by producer: 82.25 (9.14) a. Grading charges 3.00 (0.33) b. Packing charges 12.00 (1.33) c. Transportation charges 7.25 (0.80) d. Labour charges 60.00 (6.67) 3. Price paid by the consumer 900.00 (100) 4. Marketing efficiency 9.94

Table: 4.16 Price spread for peas


S.No. Functionary Rs./q (%age of consumers

price) 1. Net price received by the producer 927.00 (92.70) 2. Marketing cost incurred by producer: 73.00 (7.3) a. b. Grading charges Packing charges -----------6.00 (0.6) c. Transportation charges 7.00 (0.7) d. Labour charges 60.00 (6.0) 3. Price paid by the consumer 1000.00 (100) 4. Marketing efficiency 12.70

Table: 4.17 Price spread for cauliflower


S.No. Functionary Rs./q (%age of consumers price) 1. Net price received by the producer 724.75 (90.60) 2. Marketing cost incurred by producer: 75.25 (9.40) a. Grading charges 1.00 (0.13) b. Packing charges 6.00 (0.75) c. Transportation charges 8.25 (1.03) d. Labour charges 60.00 (7.5) 3. Price paid by the consumer 800.00 (100) 4. Marketing efficiency 10.07

Table: 4.18 Price spread for French bean


S.No. Functionary Rs./q (%age of consumers price) 1. Net price received by the producer 907.75 (92.63) 2. Marketing cost incurred by producer: 72.25 (7.37) a. Grading charges 1.25 (0.13) b. Packing charges 6.50 (0.66) c. Transportation charges 4.50 (0.46) d. Labour charges 60.00 (6.12) 3. Price paid by the consumer 980.00 (100) 4. Marketing efficiency 11.56

Table: 4.19 Price spread for ladys finger


S.No. Functionary Rs./q (%age of consumers price) 1. Net price received by the producer 1086.75 (94.50) 2. Marketing cost incurred by producer: 63.25 (5.50) a. Grading charges 2.00 (0.17) b. Packing charges 6.00 (0.52) c. Transportation charges 5.25 (0.46) d. Labour charges 50.00 (4.35) 3. Price paid by the consumer 1150.00 (100) 4. Marketing efficiency 17.18

Table: 4.20 Price spread for brinjal


S.No. Functionary Rs./q (%age of consumers price) 1. Net price received by the producer 619.75 (88.53) 2. Marketing cost incurred by producer: 80.25 (11.46) a. Grading charges 1.50 (0.21) b. Packing charges 6.50 (0.93) c. Transportation charges 7.25 (1.03) d. Labour charges 65.00 (9.28) 3. Price paid by the consumer 700.00 (100) 4. Marketing efficiency 7.72

Channel-II:
The crop wise price spread of different selected vegetables for channel II (producer retailer consumer) is depicted in Tables 4.21 to 4.26. The tables revealed that in case of channel-II, the producers share in consumers rupee was found to be more than 70% in all the selected crops and it was found to be maximum (79.95%) in French bean. It means that the producers were receiving in the range of 70 to 80 per cent of consumers rupee in selected vegetables. Net price received by growers was found to be maximum in French bean and lowest for peas (Fig. 7). Marketing costs incurred by producer were observed to be maximum (3.5%) in case of tomato and minimum (1.46%) in case of ladys finger. Margin of retailer was found to be maximum of Rs. 232.50/quintal (23.25%) in case of peas and lowest (15.91%) in case of ladys finger. The retailer incurred Rs. 46.00, 42.50, 39.75, 39.75, 42.00 and Rs. 38.35 per quintal on loading/unloading, storage, transportation and losses for tomato, peas, cauliflower, French bean, ladys finger and brinjal, respectively. Marketing efficiency of selected vegetables in channel-II was found between 2.42 to 3.99 per cent (Fig. 8). The price paid by retailer was reported maximum in case of French bean (81.63%) followed by ladys finger (80.43%), tomato (77.80%), cauliflower (75.00%), brinjal (75.00%), and peas (72.50%) respectively.

4.5.2 Price spread in marketing of selected vegetable crops through channel-II Table: 4.21 Price spread for tomato
S.No. Functionary Rs./q (percentages of

consumers price) 1. Net price received by the producer 668.50 (74.30)

2.

Marketing cost incurred by producer

31.50 (3.50)

a.

Grading charges

3.00 (0.33)

b.

Packing charges

16.50 (1.83)

c.

Transportation charges

10.00 (1.11)

d.

Loading/unloading charges

2.00 (0.22)

3.

Price paid by retailer

700.00 (77.80)

4.

Margin of retailer

154 (17.11)

5.

Marketing cost incurred by retailer

46.00 (5.11)

6.

Price paid by consumer

900.00 (100)

7.

Marketing efficiency

2.89

Table: 4.22 Price spread for peas


S.No. Functionary Rs./q (percentages of

consumers price) 1. Net price received by the producer 707.50

(70.75) 2. Marketing cost incurred by producer 17.50 (1.75) a. Grading charges 1.50 (0.15) b. Packing charges 5.00 (0.5) c. Transportation charges 9.00 (0.90) d. Loading/unloading charges 2.00 (0.20) 3. Price paid by retailer 725.00 (72.50) 4. Margin of retailer 232.50 (23.25) 5. 6. Marketing cost incurred by retailer Price paid by consumer 42.50 1000.00 (100) 7. Marketing efficiency 2.42

Table: 4.23 Price spread for cauliflower


S.No. Functionary Rs./q (percentages of

consumers price) 1. Net price received by the producer 577.75 (72.22) 2. Marketing cost incurred by producer 22.25 (2.78) a. Grading charges 1.00 (0.13) b. Packing charges 9.00 (1.13) c. Transportation charges 10.25 (1.29) d. Loading/unloading charges 2.00 (0.25) 3. Price paid by retailer 600.00 (75.00) 4. Margin of retailer 160.25 (20.03) 5. Marketing cost incurred by retailer 39.75 (4.97) 6. Price paid by consumer 800.00 (100) 7. Marketing efficiency 2.77

Table: 4.24 Price spread for French bean


S.No. Functionary Rs./q (percentages of

consumers price) 1. Net price received by the producer 783.50 (79.95) 2. Marketing cost incurred by producer 16.50 (1.68) a. Grading charges 1.25 (0.13) b. Packing charges 4.75 (0.48) c. Transportation charges 8.50 (0.87) d. Loading/unloading charges 2.00 (0.20) 3. Price paid by retailer 800.00 (81.63) 4. Margin of retailer 140.25 (14.31) 5. Marketing cost incurred by retailer 39.75 (4.06)

6.

Price paid by consumer

980.00 (100)

7.

Marketing efficiency

3.99

Table: 4.25 Price spread for ladys finger


S.No. Functionary Rs./q (percentages of

consumers price) 1. Net price received by the producer 908.25 (78.98) 2. Marketing cost incurred by producer 16.75 (1.46) a. Grading charges 1.50 (0.13) b. Packing charges 4.75 (0.41) c. Transportation charges 8.50 (0.74) d. Loading/unloading charges 2.00 (0.17) 3. Price paid by retailer 925.00

(80.43) 4. Margin of retailer 13 (15.91) 5. Marketing cost incurred by retailer 42.00 (3.65) 6. Price paid by consumer 980.00 (100) 7. Marketing efficiency 3.99

Table: 4.26 Price spread for brinjal


S.No. Functionary Rs./q (percentages of

consumers price) 1. Net price received by the producer 506.00 (72.29) 2. Marketing cost incurred by producer 19.00 (2.71) a. Grading charges 1.78 (0.25) b. Packing charges 6.00 (0.86) c. Transportation charges 9.25

(1.32) d. Loading/unloading charges 2.00 (0.29) 3. Price paid by retailer 525.00 (75.00) 4. Margin of retailer 136.65 (19.52) 5. Marketing cost incurred by retailer 38.35 (5.48) 6. Price paid by consumer 700.00 (100) 7. Marketing efficiency 2.61

Channel-III:
Channel-III (producer wholesaler/commission agent retailer consumer)

was the very important channel prevailed in the study area. The unit marketing costs and margins in marketing of selected vegetables through channel-III reveals that more than 70 per cent vegetable growers followed this channel to sell their produce. The data pertaining to channel-III is presented in tables 4.27 to 4.32. The tables revealed that producers were receiving in the range of 48 to 64 per cent of consumers rupee in different vegetables. The producers share in consumers rupee was observed to be maximum in case of French bean (63.88%) and in case of tomato, peas, cauliflower, ladys finger and brinjal, it was observed to be 56.00, 53.07, 54.09, 62.56 and 48.07 per cent respectively (Fig. 9). Net price received

by growers was found maximum in French bean and lowest for brinjal. The producers expenses varied between 6.94 and 11.00 per cent of consumers rupee in different vegetables. Marketing costs on grading, packing, transportation, loading/unloading and commission charges in wholesale market, incurred by producers were observed to be maximum of Rs. 96.50/quintal (11.00%) in case of tomato followed by ladys finger (Rs. 80.55), French bean (Rs. 74.00), peas (Rs. 69.53), cauliflower (Rs. 67.25), and brinjal (Rs. 63.50) respectively. Price paid by wholesaler in wholesale market was observed to be highest in case of French bean (71.43%) followed by ladys finger (69.57%), tomato (67.00%), cauliflower (62.50%), peas (60.00%), and brinjal (57.14%). Whereas price paid by retailer for the selected vegetables were observed to be maximum (81.63%) in case of French bean followed by ladys finger (80.43%), tomato (78.00%), brinjal (75.00%), cauliflower (75.00%), and peas (72.50%) respectively. Similarly, price paid by consumer was also assessed for the selected vegetable crops in channel-III and found to be maximum Rs. 1150/q in case of ladys finger and lowest (Rs. 700/q) for brinjal. Margin of wholesaler/commission agent was observed to be highest in case of tomato (17.00%) followed by brinjal (13.68%). Marketing costs on loading/unloading, transportation, losses and storage incurred by the wholesaler/commission agents were found to be highest in case of brinjal (4.18%) followed by tomato (4.00%). Margin of retailer was found to be highest (22.07%) in case of peas followed by cauliflower (19.07%) and marketing costs on loading/unloading, storage and transportation and losses incurred by retailer were found to be maximum (6.44%) in case of brinjal followed by tomato (6.00%). The marketing efficiency was found to be maximum for all the selected vegetables in channel-I and minimum in channel-III which ranged between 0.93 to 1.81 per cent (Fig. 10).

4.5.3 Price spread in marketing of selected vegetable crops through channel-III Table: 4.27 Price spread for tomato
S.No. Functionary Rs./q (percentages of

consumers price) 1. Net price received by the producer 503.50 (56.00) 2. Marketing cost incurred by producer 96.50 (11.00) 3. Price paid by wholesaler in wholesale market (Gross price received by the producer) 4. Margin of wholesaler/commission agent 600.00 (67.00) 65.20 (17.00) 5. Marketing cost incurred by wholesaler/CA 34.80 (4.00) 6. Price paid by retailer 700.00 (78.00) 7. Margin of retailer 143.00 (16.00) 8. Cost incurred by retailer 57.00 (6.00) 9. Price paid by consumer 900.00 (100.00) 10. Marketing efficiency 1.27

Table: 4.28 Price spread for peas


S.No. Functionary Rs./q (percentages of

consumers price) 1. Net price received by the producer 530.65 (53.07) 2. Marketing cost incurred by producer 69.53 (6.94) 3. Price paid by wholesaler in wholesale market (Gross price received by the producer) 4. Margin of wholesaler/commission agent 600.00 (60.00) 93.25 (9.33) 5. Marketing cost incurred by wholesaler/CA 31.75 (3.18) 6. Price paid by retailer 725.00 (72.50) 7. Margin of retailer 220.75 (22.21) 8. Cost incurred by retailer 54.25 (5.43) 9. Price paid by consumer 1000.00 (100.00) 10. Marketing efficiency 1.13

Table: 4.29 Price spread for cauliflower


S.No. Functionary Rs./q (percentages of

consumers price) 1. Net price received by the producer 432.75 (54.09) 2. Marketing cost incurred by producer 67.25 (8.41) 3. Price paid by wholesaler in wholesale market (Gross price received by the producer) 4. Margin of wholesaler/commission agent 500.00 (62.50) 68.00 (8.50) 5. Marketing cost incurred by wholesaler/CA 32.00 (4.00) 6. Price paid by retailer 600.00 (75.00) 7. Margin of retailer 152.25 (19.03) 8. Cost incurred by retailer 47.75 (5.97) 9. Price paid by consumer 800.00

(100.00) 10. Marketing efficiency 1.18

Table: 4.30 Price spread for French bean


S.No. Functionary Rs./q (percentages of

consumers price) 1. Net price received by the producer 626.00 (63.88) 2. Marketing cost incurred by producer 74.00 (7.55) 3. Price paid by wholesaler in wholesale market (Gross price received by the producer) 4. Margin of wholesaler/commission agent 700.00 (71.43) 67.70 (6.91) 5. Marketing cost incurred by wholesaler/CA 32.30 (3.30) 6. Price paid by retailer 800.00 (81.63) 7. Margin of retailer 125.00

(12.76) 8. Cost incurred by retailer 55.00 (5.61) 9. Price paid by consumer 980.00 (100.00) 10. Marketing efficiency 1.81

Table: 4.31 Price spread for ladys finger


S.No. Functionary Rs./q (percentages of

consumers price) 1. Net price received by the producer 719.45 (62.56) 2. Marketing cost incurred by producer 80.55 (7.00) 3. Price paid by wholesaler in wholesale market (Gross price received by the producer) 4. Margin of wholesaler/commission agent 800.00 (69.57) 90.40 (7.86) 5. Marketing cost incurred by wholesaler/CA 34.60

(3.01) 6. Price paid by retailer 925.00 (80.43) 7. Margin of retailer 161.25 (14.02) 8. Cost incurred by retailer 63.75 (5.54) 9. Price paid by consumer 1150.00 (100.00) 10. Marketing efficiency 1.67

Table: 4.32 Price spread for brinjal


S.No. Functionary Rs./q (percentages of

consumers price) 1. Net price received by the producer 336.50 (48.07) 2. Marketing cost incurred by producer 63.50 (9.07) 3. Price paid by wholesaler in wholesale market 400.00

(Gross price received by the producer) (57.14) 4. Margin of wholesaler/commission agent 95.75 (13.68) 5. Marketing cost incurred by wholesaler/CA 29.25 (4.18) 6. Price paid by retailer 525.00 (75.00) 7. Margin of retailer 129.90 (18.57) 8. Cost incurred by retailer 45.10 (6.44) 9. Price paid by consumer 700.00 (100.00) 10. Marketing efficiency 0.93

4.6 Problems in vegetable marketing


The lack of availability of cheap labour, inadequate credit facility, lack of standard grades, costly packing materials, high transportation costs, lack of cool chain system, lack of proper storage facilities/systems, lack of proper enforcement of market laws, lack of proper

congestion problems, law and fluctuating prices, high marketing margins were identified as major problems in vegetable marketing in the area.
i.

Lack of proper storage facilities at the market place compel the farmers to sell their perishable produce even at unfavourable prices (Table 4.33). The farmer loses the bargaining power once the produce is unloaded in the market. This affects the pricing efficiency in agricultural markets. Hence, proper storage facilities should be provided at the market place. Because of high perishability of vegetables and poor standardization of products, physical inspection by buyers need to be facilitated in order to ascertain just what was being bought. In this regard, improved techniques of refrigeration and storage along with improved grading procedures in the producing areas needs to be introduced. Farmers should not only be trained and educated in respect of opportunities for value additions to their produce but also be trained in scientific storage methods and grading procedures.

ii. Malpractices in buying and selling affect the distributive justice and efficiency of the

system (Table 4.33). The commission agents normally remain in league with the buyers, who are their regular clients, rather than the individual farmer. Many unauthorized deductions are made from the farmers even in regulated markets. Malpractices are more frequent when farmers have low status, poor education, and weak bargaining power. These malpractices need to be curbed through strict enforcement of market laws.

Table: 4.33 Multiple response of vegetable growers related to problems faced in the market
S.No. Problems Vegetable growers (in per cent) severe 1. Problem of space to unload 12 moderate 56 normal 12 No problem 20

the truck 2. Sometimes climatic conditions does not allow to unload the truck 3. Malpractices by traders at the time of auction 4. Others facilities such as storage 70 8 16 6 64 20 12 4 16 16 60 8

iii. About 80 per cent of the respondents in the study area felt that the institutional credit presently available to them is not sufficient for marketing. Whereas 64 per cent of the respondents replied negative towards the proper timing of institutional credit when they need it most (Table 4.34). It necessitates on the fact that this credit-linked marketing needs to be revamped. In this regard, credit and crop insurance of vegetable cultivation should be provided from the formal institutional sources so as to lessen growers dependence on traders on this account and to improve their bargaining power in the market.

Table: 4.34 Multiple response of vegetable growers related to the problem of financing
S. No. Problems Vegetable growers (in percent) Yes 1. 2. 3. Institutional credit is not available at proper time Institutional credit is not sufficient for marketing Interest rate of non-institutional credit is high 64 80 44 No 36 20 56

iv. Source of market information and its effectiveness was also analysed and it was depicted in Table 4.35. The table reveals that about 64 to 72 per cent of the respondents received market-related information from village traders and personal

visits and about 20 per cent through radio. It stresses on the fact that communication network between growers and market needs to be enhanced.

Table: 4.35 Multiple response of vegetable growers related to market information


S.No. Source of market information and its effectiveness 1. 2. 3. 4. 5. 6. Village trader Neighbour farmer Radio/T.V Trunk call from wholesaler/CA Telegram/postcard Personal visits to important market Vegetable growers (in per cent) Yes 64 40 20 76 32 72 No 36 60 80 24 68 28

v. Non-availability of sufficient market information also effects operational efficiency of

the vegetable markets (Table 4.36). Farmers often remain deprived of the latest information about prices prevailing in different markets, changes in demand, and prospective prices of the crops, etc. Thus, they miss the opportunities to sell their produce at the right time and place so as to obtain the most remunerative prices. Therefore, emphasis should be given to develop a mechanism through which latest market information is displayed and made available to the growers on daily basis.

Table: 4.36 Multiple response of vegetable growers related to problems faced in getting market-related information

S.No.

Problems Yes

Vegetable growers (in percent) No 20 24 Somewhat 16 40

1. 2.

Late information Information available for limited markets

64 36

3. 4.

Misleading information Inadequate information

28 50

60 40

12 10

vi. The conditions of the market yard are not always good. Problem of

protection of the

produce from sun and rains, etc. always adds to the problems of wastage and quality deterioration. In market sanitary conditions must also be given due attention. vii. Though vegetable crops are relatively more profitable as compared to cereals and other crops, yet lack of irrigation, high yield instability, uncertain and fluctuating prices limit their widespread cultivation. The high price variability of vegetables is due to weak vertical linkage between production, marketing and processing. This calls for developing appropriate institutional arrangement for minimizing the price uncertainity.
viii.Infrastructure like access to motorable roads, transport and communication facilities,

market yards and market expansion, irrigation, rural literacy, etc. created enabling conditions for setting in motion the process of efficient vegetable marketing, even in the remote areas. Their positive impact can be seen in improved income status, enlarged employment, improved structure and conduct of agricultural marketing. There is still more scope to expand and improve infrastructural and other facilities, so that their benefits are diffused to and equitably shared by all section of farming community in the area. ix. Besides all above, the concept of e-marketing could be used to increase the marketing efficiency in vegetable crops.

CHAPTER V SUMMARY AND CONCLUSIONS

CHAPTER 5
SUMMARY AND CONCLUSIONS

The present study was an attempt to analyse the vegetable production and marketing scenario in the Solan district of Himachal Pradesh with special reference to the following objectives. To identify the marketing channels of selected vegetables in Solan district of Himachal Pradesh. To study the margins and costs of intermediaries at various levels/stages of vegetable marketing. To workout the bottlenecks in the vegetable marketing system and suggest and recommend policy guidelines for improving vegetable marketing. The study is based both on primary and secondary data. The primary data were collected from selected vegetable growers through sample survey and personal interview method. Multi-stage random sampling procedure was adopted to select the villages, growers, and vegetable crops from five developmental blocks in the district. Out of five developmental blocks in the district one block was purposively selected. Thereafter, five villages with highest acreage under vegetable crops were selected viz., Damrog, Deonthi, Shamti, Oachghat, and Nauni respectively. A total sample of 50 vegetable growers was drawn for the purpose of study. Similarly, for the collection of data from market functionaries a random sample of ten each of wholesaler, commission agent, and retailer constituting a sample of 30 market functionaries was taken for detailed study. The secondary data related to the study were collected from various publications and records of different institutions, namely, State Agriculture Department, National Horticulture Board, Market Committee and various other published sources of government and semi-government organizations. The data was analysed using appropriate statistical tools.
The study has thrown up a number of insightful findings in respect of production and

marketing of vegetables in the Solan district. The analysis of distribution of area and production under vegetables in sampled villages reveals a significant increase in the net sown area especially area under ladys finger in Damrog. Among the sampled villages, highest acreage of 23.47 per cent in case of French bean was observed followed by tomato. It shows that area under commercial crops has gain momentum in the study area. Similarly, production of commercial crops has also increased in comparison to the past especially in Deonthi village which outfar other sampled villages. As French bean occupied maximum 24.05 per cent of total production of vegetables in sampled area it indicates towards the fact that the area is gaining prominence in cultivation of beans, in addition to other crops.

Insofar as marketing of vegetables is concerned commission agents, retailer,

forwarding agents are the most important marketing agencies through which the growers sold most of their produce. In the study area, more than 90 to 95 per cent of total produce of different vegetables on an average was meant for the market. Whole of this surplus in sampled villages was sold in the nearby local markets. The pattern of home consumption, payments in kind, quantity spoiled of different vegetables was found to be almost similar.
Three main marketing channels were identified during the course of study of the

vegetable marketing in the area. Out of these three, wholesaler/commission agent (channel-III) channel was found one of the most important channel in almost all of the study area (except channel-II in Oachghat and channel-I in Deonthi) through which maximum proportion of marketable surplus (57 to 97 per cent) of different vegetables in area was routed.
The marketing costs and price spread of major vegetable crops produced in the area

were analysed for different marketing channels which reveals that the producers were receiving in the range of 88 to 95 per cent of consumers rupee in different vegetables in channel-I. Producers expenses varied from 5 to 12 per cent of consumer rupee in this channel for selected vegetables. For channel-II producers share in consumer rupee ranged between 70 to 80 per cent. Whereas retailer expenses ranged from 3 to 6 per cent of consumers rupee in this channel in selected vegetables. Similarly, for channel-III producers price in consumer rupee ranged between 48 to 64 per cent for selected vegetables in the area. Intermediaries margins in case of channel-III indicates that combined margins (wholesaler/CA + retailer) were high and ranged from 19.67 to 33.00 per cent. The pattern of price spread is almost same for all the vegetable crops except for brinjal and French bean. Producers share for brinjal and French bean in channel-III was 48.07 (minimum) and 63.88 (maximum) per cent of consumers rupee.
Marketing efficiency of the selected vegetables in the study area was found to be

maximum in case of channel-I and minimum in channel-III. It indicate towards the larger role of intermediaries in marketing of vegetables in the study area as they relish much higher marketing margins. The study stresses on the fact that marketing efficiency of the selected vegetables can be increased through reduction or elimination of the market functionaries.

Farmers should not only be trained and educated in respect of opportunities for value additions to their produce but also be trained in scientific storage methods and grading procedures.
Malpractices in the market need to be curbed through strict enforcement of market

laws.
Credit and crop insurance of vegetable cultivation should be provided from the formal

institutional sources so as to lessen growers dependence on traders on this account and to improve their bargaining power in the market.
Communication network between growers and market needs to be enhanced. To develop a mechanism through which latest market information is displayed and

made available to the growers on daily basis.


In market sanitary conditions must also be given due attention. There should be development of appropriate institutional arrangement for minimizing

the price uncertainity.


The farmers should be made aware of the concept of e-marketing so, that they can

increase the marketing efficiency in vegetable crops.

CHAPTER VI BIBLIOGRAPHY

CHAPTER 6
BIBLIOGRAPHY
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2. Khan, D., Bashir, M., Kassana, M. J. and M. Zulfiqar, (2005). Determining

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3. Singh, M. K, (2004). Economics of Production and Marketing of Vegetables in

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Vegetable Crops in Solan District of Himachal Pradesh. Indian Journal of Agricultural Economics.

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APPENDICES

APPENDICES Appendix: I Schedule for growers


Name of the producer/vegetable grower VillageTehsil.. 1. Which vegetables you have grown and sell in the market? S.No. Vegetables Area Production Quantity Home Quantity Payments

(Q) 1. 2. 3. 4. 5. 6. 7. Tomato Peas Cauliflower French bean Ladys finger Brinjal Any others (specify)

sold (Q)

consumed spoiled (Q)

in kind

2. To whom you sell your vegetable crop? S.No. 1. 2. 3. 4. 5. 6. Hawkers Retailers Consumers Beoparies/wholesalers Pre-harvest contractor Market/sabji mandi Quantity sold (Q) Price

3. Problems faced in the market: S.No. Problems 1. 2. Problem of space to unload the truck Sometimes climatic conditions does not allow to unload the truck Malpractices by traders at the time of auction Others specify severe moderate normal No problem

3. 4.

4. Do you think these problems can be minimized if yes how a. b. c. d. 5. What is your opinion about services of marketing committee for regulation? a. services are excellent b. services are optimum c. services are not good 6. Finance related problems a. Do you need funds from other sources for marketing? b. Problem of financing: S.No. Problems 1. 2. 3. Institutional credit is not available at proper time Institutional credit is not sufficient for marketing Interest rate of noninstitutional credit is high Yes No If yes why Yes/No

7. Suggestions a. b. c. d. e. f.

8. Market information S.No. Source of market information and its effectiveness Village trader Neighbour farmer Radio/T.V Trunk call from commission agents/wholesaler Telegram/postcard Personal visits to important market Yes/no Rating according to scale (04) (5-8) (9-10)

1. 2. 3. 4.

5. 6.

Where 0-4 = 1& 2, 5-8 =3&4, and 9-10 = all.

9. Problems faced in getting information S.No. 1. 2. 3. 4. Problems Late information Information available for limited markets Misleading information Inadequate information Yes No Somewhat

Appendix: II Schedule for commission agent

Name of commission agent. Market/Mandi .


1. Vegetables you are dealing

with
2. Auction price of the aforesaid vegetable 3. Net margin @.........of auction price.

Appendix: III Schedule for wholesaler


Name of the wholesaler Location/area. 1. Vegetables you are dealing with. 2. From whom you buy the vegetables: i. Farmers ii. Hawkers iii. Subji mandi 1. Market cost accrued to you for the aforesaid vegetable: I. Purchase price.. II. Transport charges.. III. Rent of shop. IV. Sorting and repacking charges V. Wastage VI. Total cost.. VII.Gross income

VIII.Net margin.

Appendix: IV Schedule for retailer

Name of the retailer.. Location/area 1. Vegetables you are dealing with. 2. From whom you buy the vegetables: I. Farmers II. Wholesalers III. Subji mandi 1. Marketing cost for the aforesaid vegetable(s): I. Purchase price.. II. Rent of shop III. Sorting costs.. IV. Repacking costs. V. Transport charges. VI. Labour charges VII.Other costs.. VIII.Wastage.. IX. Total costs.. X. Gross income XI. Net margins. 1. At what price you sell these vegetables to the customers?