Agricultural marketing support

In the United States the Agricultural Marketing Service (AMS) is a division of USDA and has programs for
cotton, dairy, fruit and vegetable, livestock and seed, poultry, and tobacco. These programs provide
testing, standardization, grading and market news services and oversee marketing agreements and
orders, administer research and promotion programs, and purchase commodities for federal food
programs. The AMS also enforces certain federal laws. USDA also provides support to the Agricultural
Marketing Resource Center at Iowa State University and toPenn State University.
In the United Kingdom support for marketing of some commodities was provided before and after the
Second World War by boards such as the Milk Marketing Board and the Egg Marketing Board, but these
were closed down in the 1970s. As a colonial power Britain established marketing boards in many
countries, particularly in Africa. Some continue to exist although many were closed down at the time of the
introduction of structural adjustment measures in the 1990s.
In recent years several developing countries have established government-sponsored marketing or
agribusiness units. South Africa, for example, started the National Agricultural Marketing Council (NAMC)
as a response to the deregulation of the agriculture industry and closure of marketing boards in the
country. India has the long-established National Institute of Agricultural Marketing (NIAM). These are
primarily research and policy organizations, but other agencies provide facilitating services for marketing
channels, such as the provision of infrastructure, market information and documentation support.
Examples include the National Agricultural Marketing Development Corporation (NAMDEVCO) in Trinidad
and Tobago and the New Guyana Marketing Corporation.
Several organizations provide support to developing countries to develop their agricultural marketing
systems, including FAO's agricultural marketing unit and various donor organizations. There has also
recently been considerable interest by NGOs to carry out activities to link farmers to markets.
[edit]Agricultural

marketing development

Well-functioning marketing systems necessitates a strong private sector backed up by appropriate policy
and legislative frameworks and effective government support services. Such services can include
provision of market infrastructure, supply of market information (as done by USDA, for example), and
agricultural extension services able to advise farmers on marketing. Training in marketing at all levels is
also needed. One of many problems faced in agricultural marketing in developing countries is the latent
hostility to the private sector and the lack of understanding of the role of the intermediary. For this reason
middleman has become very much a pejorative word.
[edit]Agricultural

advisory services and the market

Promoting market orientation in agricultural advisory services aims to provide for the sustainable
enhancement of the capabilities of the rural poor to enable them to benefit from agricultural markets and
help them to adapt to factors which impact upon these. As a study by the Overseas Development
Institute demonstrates, a value chain approach to advisory services indicates that the range of clients
serviced should go beyond farmers to include input providers, producers, producer organisations and
processors and traders.[2]

[edit]Market

infrastructure

Efficient marketing infrastructure such as wholesale, retail and assembly markets and storage facilities is
essential for cost-effective marketing, to minimise post-harvest losses and to reduce health risks. Markets
play an important role in rural development, income generation, food security, developing rural-market
linkages and gender issues. Planners need to be aware of how to design markets that meet a
community's social and economic needs and how to choose a suitable site for a new market. In many
cases sites are chosen that are inappropriate and result in under-use or even no use of the infrastructure
constructed. It is also not sufficient just to build a market: attention needs to be paid to how that market
will be managed, operated and maintained. [3] In most cases, where market improvements were only
aimed at infrastructure upgrading and did not guarantee maintenance and management, most failed
within a few years.[4]
Rural assembly markets are located in production areas and primarily serve as places where farmers can
meet with traders to sell their products. These may be occasional (perhaps weekly) markets, such as haat
bazaars in India and Nepal, or permanent. Terminal wholesale markets are located in major metropolitan
areas, where produce is finally channelled to consumers through trade between wholesalers and retailers,
caterers, etc. The characteristics of wholesale markets have changed considerably as retailing changes in
response to urban growth, the increasing role of supermarkets and increased consumer spending
capacity. These changes require responses in the way in which traditional wholesale markets are
organized and managed.
Retail marketing systems in western countries have broadly evolved from traditional street markets
through to the modern hypermarket or out-of-town shopping centre. In developing countries, there
remains considerable scope to improve agricultural marketing by constructing new retail markets, despite
the growth of supermarkets, although municipalities often view markets as sources of revenue rather than
infrastructure requiring development. Effective regulation of markets is essential. Inside the market, both
hygiene rules and revenue collection activities have to be enforced. Of equal importance, however, is the
maintenance of order outside the market. Licensed traders in a market will not be willing to cooperate in
raising standards if they face competition from unlicensed operators outside who do not pay any of the
costs involved in providing a proper service.[5]
[edit]Market

information

Efficient market information can be shown to have positive benefits for farmers and traders. Up-to-date
information on prices and other market factors enables farmers to negotiate with traders and also
facilitates spatial distribution of products from rural areas to towns and between markets. [6] Most
governments in developing countries have tried to provide market information services to farmers, but
these have tended to experience problems of sustainability. Moreover, even when they function, the
service provided is often insufficient to allow commercial decisions to be made because of time lags
between data collection and dissemination. [7] Modern communications technologies open up the
possibility for market information services to improve information delivery through SMS on cell phones
and the rapid growth of FM radio stations in many developing countries offers the possibility of more
localised information services. In the longer run, the internet may become an effective way of delivering
information to farmers. However, problems associated with the cost and accuracy of data collection still
remain to be addressed. Even when they have access to market information, farmers often require
assistance in interpreting that information. For example, the market price quoted on the radio may refer to
a wholesale selling price and farmers may have difficulty in translating this into a realistic price at their

local assembly market.[8] Various attempts have been made in developing countries to introduce
commercial market information services but these have largely been targeted at traders, commercial
farmers or exporters. It is not easy to see how small, poor farmers can generate sufficient income for a
commercial service to be profitable although in India a new service introduced by Thompson Reuters was
reportedly used by over 100,000 farmers in its first year of operation. Esoko in West Africa attempts to
subsidize the cost of such services to farmers by charging access to a more advanced feature set of
mobile-based tools to businesses.
[edit]Marketing

training

Farmers frequently consider marketing as being their major problem. However, while they are able to
identify such problems as poor prices, lack of transport and high post-harvest losses, they are often
poorly equipped to identify potential solutions. Successful marketing requires learning new skills, new
techniques and new ways of obtaining information. Extension officers working with ministries of
agriculture or NGOs are often well-trained in horticultural production techniques but usually lack
knowledge of marketing or post-harvest handling. [9] Ways of helping them develop their knowledge of
these areas, in order to be better able to advise farmers about market-oriented horticulture, need to be
explored. While there is a range of generic guides and other training materials available from FAO and
others, these should ideally be tailored to national circumstances to have maximum effect.
[edit]Enabling

environments

Agricultural marketing needs to be conducted within a supportive policy, legal, institutional, macroeconomic, infrastructural and bureaucratic environment. Traders and others cannot make investments in
a climate of arbitrary government policy changes, such as those that restrict imports and exports or
internal produce movement. Those in business cannot function if their trading activities are hampered by
excessive bureaucracy. Inappropriate law can distort and reduce the efficiency of the market, increase the
costs of doing business and retard the development of a competitive private sector. Poor support
institutions, such as agricultural extension services, municipalities that operate markets inefficiently and
export promotion bodies, can be particularly damaging. Poor roads increase the cost of doing business,
reduce payments to farmers and increase prices to consumers. Finally, the ever-present problem
of corruption can seriously impact on agricultural marketing efficiency in many countries by increasing the
transaction costs faced by those in the marketing chain.
[edit]Recent

developments

New marketing linkages between agribusiness, large retailers and farmers are gradually being developed,
e.g. through contract farming, group marketing and other forms of collective action.[10]Donors and NGOs
are paying increasing attention to ways of promoting direct linkages between farmers and buyers. [11] The
growth of supermarkets, particularly in Latin America and East and South East Asia, is having a significant
impact on marketing channels for horticultural, dairy and livestock products. [12] Nevertheless, spot
markets will continue to be important for many years, necessitating attention to infrastructure
improvement such as for retail and wholesale markets.

the
1.
2.
3.
4.
5.
6.
7.
8.
9. Etc

problems
lack
lack
lack
lack
lack
poor
lack

of
of
of

of

poor
access
uniform
access
sincererity

to
ie

are:
of
standardization
of
processing
government
intervention
infrastructure
to
credit
facility
units
or
measures
marketing
information
prevalence
of
cheating

Problems of Agricultural Marketing Africa

Discuss the problems in agricultural marketing and show the policy implications of each
of these problems answers

17 Problems of Agricultural Development

Ads by Google

Generators Kenyawww.GeneratorsKenya.com
Best prices on Cummins, Perkins, John Deere generator sets by Aksa

Get Top Data Speed Nowwww.yu.co.ke

Over 850 Towns Covered Countrywide. Exciting Offers on Data & Top Ups.

Organic Farming www.acresusa.com

Learn how to farm organically Books, magazine on crops, livestock
Developing countries are faced with numerous problems which militate against the development of
agriculture. Some of the problems are:
1. Problem of Land Tenure: Land is one of the most important factors in agricultural production.
The land tenure is the way land is owned in a society. The prevailing land tenure systems in the
country often discourage agricultural land utilization. Land is owned by inheritance hence land is
fragmented over generations. Increase in population has increased the various alternatives to which
land can be put. This further puts pressure on all the available land.
2. Problems of Basic Amenities: Basic amenities like electricity cinema, standard schools, good
and functioning health centers, recreational parks for relaxation, good roads, telephone, television
viewing centers etc, are lacking in the rural areas. This often leads to the following:
a) Rural-Urban drifts, that is, people leaving the village for jobs in the city.
b) Reduction in the working population in the village.
c) Low agricultural production.
3. Problems of Finance or Poor Financing: Most agricultural activities in the developing countries
are subsistent in nature, hence the farmers: (i) are very poor (ii) cannot secure the necessary
collateral for loans (iii) cannot have access to enough credit facilities. (iv) Cannot pay the high
interest rates on loans either from financial institutions or money lenders. (v) Cannot procure the
most sophisticated machines. (vi) Cannot employ agricultural specialists whose salaries and wages
are far above what the farmers can afford.
4. Poor Transportation: This includes
(i) Bad roads (ii) Inadequate vehicles (iii) Vehicles lack spare parts (iv) High cost of bringing the farm
products from rural areas to urban centers (v) Lack of transportation which increases the activities of
middlemen in the movement of agricultural products from the farm to the urban centers where they
are consumed (vi) Lack of transport facilities which increases perishability of farm crops.

5. Poor Communication: This includes lack of good radio, television, telephone, telex, fax
machines for quick messages and assessment of latest discoveries in the agricultural sector. This
makes the professional agriculturists to be unaware of recent developments in his filed.
6. Problems of Good Storage and Processing Facilities: Storage facilities like silo, rhombus,
cribs, barns, rafters are inadequate, thus leading to: (a) Perishability of crops like tomato, pepper,
etc. (b) Pests and diseases which attack farm products (c) Farmers fumigating their products. (d)
Glut during harvests and famine outside harvest periods. (e) The quality of farm products being
reduced. (f) Farm products wasting. Processing facilities like thresher, miller, grater, canning
machine and sealing machines are: (i) Very expensive to procure (ii) Highly technical for local
farmers to operate (iii) Very difficult and expensive to maintain.
7. Lack of Good Agricultural education: Most of the farmers in the developing countries are not
educated enough in the technicalities relating to agricultural product, hence, they are: (i) Dogmatic
and adamant to changes (ii) Very superstitious in their beliefs (iii) Very suspicious of any new
innovation (iv) Unscientific in mind and thinking (v) Not willing to accept technological changes (vi)
Very uncooperative, hostile and unaccommodating (vii) Unwilling to even learn how to use and apply
fertilizers, insecticides and new farm tools. All these bring about low agricultural productivity.
8. Poor Extension Activities: Extensive helps in disseminating recent information to a large
number of people within a very short time. This is not the case in developing countries because:: (i)
Extension workers are too ill-equipped for the work. (ii) The period of training is too long. (iii)
Language barriers. (iv) Lack of recent research work. (v) The uncooperative attitude of farmers. (vi)
Lack of vehicles. (vii) Poor remuneration.
9. Poor Tools and Farm Machines: Farmers still rely on the use of tools like hoe, cutlass, rake, etc
for their activities, instead of using the mechanized implements like ridges, ploughs, cultivators, etc.
Poor tools can lead to:
(i) Drudgery of the farmer (ii) Time wasting (iii) Short life span of the farmers (iv) Low yield (v) Low
farmers income.
While machines are:
(i) Very expensive to procure and maintain (ii) Highly technical to use (iii) Cannot be used in small
farm holdings (iv) Cannot be used in some soils. (v) Cannot be used for some crops like yam.
10. Unstable Policies and Programmes of Government: Even government comes with different
programmes which often tell on the farmers.
11. Poor Marketing System: The sole aim of commercial agriculture is profit making, but this cannot
be achieved due to the following: (i) Activities of middlemen who try to remove all the gains, create
artificial scarcity, etc. (ii) Poor pricing policies. (iii) Non-functional food commodity boards for food
crops. (iv) There is also fluctuation in prices (v) Poor marketing channels for farm produce (vi) Lack
of good roads. (vii) Poor storage facilities.

12. Pest and Diseases: They can: (i) Increase the cost of production (ii) Reduce the quality of farm
produce (iii) Reduce the quality of farm produce (iv) Reduce farmers income (v) discourage farmers
from further production.
13. Unpredictable Climate: This includes: (i) Drought or long period without rain which leads to
poor harvest. (ii) Flooding or excessive rainfall which reduces yield. (iii) Excessive sunshine, which
leads to increase in temperature. (iv) Inadequate sunshine which reduces the photosynthetic ability
of plants. (v) Unfavourable climate which also reduces farm activities.
14. Agricultural Inputs: They include: (i) Agricultural chemicals like insecticides dieldrin dust, aldrin
dust, fernasan D), nematicide like rogor). (ii) Inputs like improved seeds and seedlings, improved
animal materials like the parent stock in birds are lacking. (iii) Agricultural inputs are very expensive.
(iv) The application of these chemicals can lead to pollination of the environment. (v) Some inputs
are very substandard and do not meet the desired result. (vi) Inputs like fertilizers are very expensive
and also inadequate. (vii) Most of the inputs are imported and are very expensive to procure.
15. Sociological and Psychological Attitude Towards Farming: (i) Young people feel that farming
is for the dropouts or never-do-well in the society and a profession for poor people. (ii) Farmers are
believed to be low class and the public seldom reckons with them as they do to accountants,
medical doctors, lawyers and engineers. (iii) Young people also prefer white collar jobs where they
can dress impressively.
16. Smuggling: (i) This means illegal exportation of food. (ii) It increases the cost of farm products.
(iii) Places money in the hands of few individuals. (iv) It can cause hunger in the villages, as
everybody will now want to engage in smuggling.
17. Environmental Degradation: This includes: (i) Pollination of the environment through the
activities of the industries. (ii) Soil erosion destroying the structure of land. (iii) setting up of forest
fire, which increases environmental temperature. (iv) Deforestation reduces rainfall, forest trees and
land protection. (v) Improper waste disposal can lead to spread of diseases in the environment.

PROBLEMS AND PROSPECTS IN AGRICULTURAL MARKETING

INTRODUCTION:
"The future lies with those companies who see the poor as their customers." - C. K. Prahalad ,
the
global
management
guru.
India is basically an agrarian society where sole dependence has been on agriculture since time
immemorial. In the olden days, the agricultural produce was fundamentally barter by nature
where farmers exchanged goods for goods and also against services. Gradually the scenario
changed with the changing times and agriculture produce began being sold with an element of
commercial value. Trading of agriculture produce began for exchange of money. And from
trading to marketing of agricultural produce began although mostly it is a way of traditional
selling. The marketing as a term is broader than traditional trading. And agricultural marketing as
a concept is still evolving in the Indian agrarian society.
In India, there are network of cooperatives at the local, regional, state and national levels that
assist in agricultural marketing. The commodities that are mostly handled are food grains, jute,
cotton, sugar, milk and areca nuts.
Currently large enterprises, such as cooperative Indian sugar factories, spinning mills, and
solvent-extraction plants mostly handle their own marketing operations independently. Mediumand small-sized enterprises, such as rice mills, oil mills, cotton ginning and pressing units, and
jute baling units, mostly are affiliated with cooperative marketing societies.
WHAT IS AGRICULTURAL MARKETING?
The National Commission on Agriculture defined agricultural marketing as a process which
starts with a decision to produce a saleable farm commodity and it involves all aspects of market
structure of system, both functional and institutional, based on technical and economic
considerations and includes pre and post- harvest operations, assembling, grading, storage,
transportation and distribution. The Indian council of Agricultural Research defined involvement
of three important functions, namely (a) assembling (concentration) (b) preparation for
consumption (processing) and (c) distribution.
Agricultural marketing can be defined as the commercial functions involved in transferring
agricultural products consisting of farm, horticultural and other allied products from producer to
consumer. Agricultural marketing also reflect another dimension from supply of produce from

rural to rural and rural to urban and from rural to industrial consumers. In the olden days selling
of agricultural produce was easy as it was direct between the producer to the consumer either for
money or for barter. It brief, it was selling not marketing. In the modern world it became
challenging with the latest technologies and involvement of middlemen, commission agents who
keep their margins and move the produce further. As it is well known more the number of
mediatory more will be the costs as each transaction incurs expenses and invites profits.
Ultimately when it comes to the producer the cost of the produce goes up steep. In the entire
process of marketing the producer gets the lowest price and the ultimate consumer pays the
highest as the involvement of more middlemen in the entire distribution process.
There are several complexities involved in agricultural marketing as agricultural produce
involves element of risk like perish ability and it again depends on the type of produce. If the
agriculture produce happens to be a seasonal one it involves another kind of risk. Like wise,
there are several risk elements involved in agricultural marketing. The pricing of the produce
depends on factors like seasonality and perish ability and it depends on the demand and supply
also. And all these are interwoven and ultimately make a deep impact on agricultural marketing.
AGRICULTURAL MARKETING IN INDIA:
4Ps, the acronym for price, product, place and promotion is the core principle of marketing. In
the case of agricultural marketing in India it is not exactly the marketing in the literal sense and
we can call it as distributive handling and to go further we may call it as distributive handling
of agricultural produce as there are number of intermediaries who are involved in marketing the
agricultural produce. However with the liberalization, privatization and globalization the
economic scenario in India has changed drastically and tremendously. As a result we have
noticed the changes in the distributive handling and again it reinvented and evolved as
agricultural marketing. It is basically because of the rise of retail giants who are the major buyers
in bulk quantity and who constantly look for differentiated, graded, standardized, processed and
packaged products rather than undifferentiated ones. They also look for qualitative and
quantitative supply of agricultural stocks continuously to beat the competition in the retail sector.
PROBLEMS AND PROSPECTS:
There are several challenges involved in marketing of agricultural produce. There is limited
access to the market information, literacy level among the farmers is low, multiple channels of
distribution that eats away the pockets of both farmers and consumers. The government funding
of farmers is still at nascent stage and most of the small farmers still depend on the local
moneylenders who are leeches and charge high rate of interest. There are too many vultures that
eat away the benefits that the farmers are supposed to get. Although we say that technology have
improved but it has not gone to the rural levels as it is confined to urban areas alone. There are
several loopholes in the present legislation and there is no organized and regulated marketing
system for marketing the agricultural produce. The farmers have to face so many hardships and
have to overcome several hurdles to get fair and just price for their sweat.

GLOBALISATION:
The globalization has brought drastic changes in India across all sectors and it is more so on
agriculture, farmers and made a deep impact on agricultural marketing. It is basically because of
majority of Indians are farmers. It has brought several challenges and threats like uncertainty,
turbulence, competitiveness, apart from compelling them to adapt to changes arising out of
technologies. If it is the dark cloud there is silver lining like having excellent export
opportunities for our agricultural products to the outside world.
AGRICULTURAL MARKET REFORMS:
Below are the certain measures that can be affected to bring out the reforms in agricultural
marketing so as to ensure just and fair price for the farming community.
Provide loans to the farmer at low rate of interest so that they will be freed from the clutches of
local moneylenders who squeeze them. It is said that farmer in born into debt, lives in debt and
dies in debt. Right from the beginning of the life, the poor farmers approach money lenders for
investing into cultivation who levies very high rate of interest and who takes away the maximum
amount of the share from the produce. In case if the crop fails due to natural calamities then the
situation would be worse as the farmer is not in a position to pay his loans. And ultimately he is
forced to sell the land at throw away price to the money lender.
It is essential to provide subsidized power supply and loans to the farmers as the expenses
towards
power
consumption
takes
considerable
amount
of
investments.
Generate a new distribution network that connects the farmers directly to the consumers to get
maximum returns as the present channel of distribution involves multiple mediatory who take
away the major portion of profits which otherwise the farmers is supposed to get.
Elimination of the existing loopholes in the present legislations is warranted.
There should be stringent action against black marketers and hoarders who buy the stocks from
farmers at cheap prices and create artificial demand and then sell the stocks at higher prices.
Creating local outlets at each village where the farmers sell their stocks directly to the
consumers or the authorized buyers at fixed prices would help to a great extent. Intervention of
government in this network is essential to bring the fruits to the farmers.
At the village level there should be counseling centers for farmers about the worth of their
stocks so that they can get fair price. The crucial role of Non-Governmental Organizations
(NGOs)
is
needed
in
this
context.
The existing legislations are outdated and are not in tune with the changing trends and
technological
inventions
and
the
same
need
to
be
updated
forthwith.
The retail revolution has brought several changes in the retail sector where the retail giants buy
in bulk directly from the suppliers and sell to the consumers directly and in this process they pass
the benefits to the consumers as well. In the past the consumers were paying more for less as
there were many channels of distribution system and now the consumers pay less for more.

 The government is already fulfilling the objective of providing reasonable prices for the basic
food commodities through Public Distribution System with a network of 350,000 fair-price
shops that are monitored by state governments. It is more effective in states like Punjab, Haryana
and some parts of Uttar Pradesh. And the same needs to be strengthened across the country.
Government should levy single entry tax in stead of levying multiple entry taxes either directly
or indirectly for the transactions and activities that are involved in agricultural marketing such as
transportation, processing, grading etc., as it would benefit both farmers and consumers directly.
HOW TO GET FAIR AND JUST PRICES FOR FARMERS?
Direct marketing of the agricultural produce is the need of the hour. Efforts may be made to
provide facilities for lifting the entire stock that farmers are willing to sell with incentive price.
There should be provision for storing the stocks such as godowns and warehouses. It helps the
farmers to hold the stocks till the prices are stabilized. Usually immediately just after the harvest
the prices would be low and if the farmers are patient in holding the same for some time it would
fetch better prices. The brokers play the games during the trading of the agricultural stocks which
the farmers do not know and realize because of improper information about the market prices.
The brokers without any investment and with their negotiation skills transfer stocks by buying at
low prices and selling at higher prices to the other end. The farmers need to be educated in this
regard.
There should be all-round rationalization and standardization of the prices through legislative
means. Presently there is vast gap between the marketing strategies of agricultural produce in
India and abroad and the same needs to be bridge. Remove the various malpractices prevalent in
the present system. There is need to set up marketing committees which has the representation of
growers, merchants, local bodies, traders and nominees from the govt. There should be collective
and integrative efforts and energies from all quarters for ensuring just and price for farmers.
CONCLUSION:
There is no doubt that in any marketing there is a motive towards profit involved and at the same
time the marketing is to be based on certain values, principles and philosophies such as offering
just and fair prices to the farmers who toil hard to till. Bringing necessary reforms coupled with
proper price discovery mechanism through regulated market system will help streamline and
strengthen the agricultural marketing.
In order to avoid isolation of small-scale farmers from the benefits of agricultural produce they
need to be integrated and informed with the market knowledge like fluctuations, demand and
supply concepts which are the core of economy. Marketing of agriculture can be made effective
if it is looked from the collective and integrative efforts from various quarters by addressing to
farmers, middlemen, researchers and administrators. It is high time we brought out significant
strategies in agricultural marketing with innovative and creative approaches to bring fruits of
labor to the farmers.

THEEND
Posted by Professor M.S.Rao at 2:07 PM

1 comment:

Rita Philip, Nigeria said...

It was a good article. Where your recommendation adhere to

October 19, 2011 at 6:58 PM

Post a Comment

Links to this post

Create a Link

Newer PostOlder PostHome

Subscribe to: Post Comments (Atom)

Read
more: http://profmsr.blogspot.com/2008/10/problems-and-prospects-inagricultural.html#ixzz2SfTc8hOp
Under Creative Commons License: Attribution