Agricultural Marketing system in North-Eastern States … : Rural Marketing system in Assam … : Rural Marketing system in Tripura … : Agricultural and Rural Marketing system in Meghalaya … : Perceptions of farmers on Rural Marketing … : Promoting Agribusiness Marketing Channels … : Development of Marketing Infrastructure for Farmers … : Summary and Recommendations … INTRODUCTION Background of the Study The economy of the northeastern region is predominantly agriculture comprising agriculture and horticultural crops.The rural marketing is largely unorganized in the region and dominated by the private traders.
The northeastern states have observed high production of fruits, spices and cashew in the recent past but could not fetch market price to the farmers at par with the markets in the other states. The topography of the NE states is not favorable for the movement of the products. Besides, the infrastructure, procurement practices, marketing approaches and processing facilities are also observed as the major constraints in the rural marketing in the NE region.The social and cultural taboos are also responsible to a large extent in not developing agro-industries in the region to provide better value addition to the horticultural crops. It is hence, necessary to diagnose the problems in the NE region for providing improved marketing environment and value added economic benefits to the farmers through better management of various post-harvest functions of the horticultural crops. Scope of the Study The economy of the northeastern region is predominantly agriculture consisting of agriculture and horticultural crops.
That the North-Eastern Region of India is an untapped reservoir of potential for development of horticulture is stating the obvious. Abounding in crops like Banana, Pineapple, Cashew, Citrus, Ginger and Onions which have high commercial valve before or after processing, the region seems to have already missed a great opportunity as Post-liberalized India is looking forward to penetrating international markets for some of Indian Horticultural products like grapes and mangoes as has happened in ports of Maharashtra, Andhra Pradesh and Karnataka. The rural marketing is largely unorganized in the region and dominated by the private traders.
The northeastern states have high production of fruits, spices and cashew in the recent past but could not fetch market price equivalent to the other states. The topography of the NE states is not favorable for the movement of the products. Besides, the infrastructure, procurement practices, marketing approaches and processing facilities are also observed as the major constraints in the rural marketing in the NE region. The social and cultural taboos are also responsible to a large extent in not developing agro-industries in the region to provide better value addition to the horticultural crops.Therefore it is, necessary to diagnose the problems in the NE region, in order to provide improved marketing environment and economic benefits to the farmers through better post-harvest management of the horticultural crops.
Objectives of the Study In recognition of the vast scope that exists in the north eastern region for improving the socio-economic condition of the farmers through better post-harvest management of horticultural produce with specific emphasis on marketing, the study is designed covering three states of Assam, Meghalaya and Tripura.The specific objectives of the study will be as under: ?? To assess the existing infrastructure and policy support from the state and central government for post-harvest management and marketing of horticultural produce. ?? To study the existing practices for procurement, pricing and payments to the horticulture farmers on their produce and problems thereof. ?? To study the institutional arrangements and economic linkages across the area of study ?? To study the existing agro-processing network in terms of constraints related to capacity, productivity and overall viability, and ? To suggest policy measures to overcome the constraints in the present system and identify areas for more in-depth study in future. AGRICULTURAL MARKETING SYSTEM IN NORTHEASTERN STATES Indian agriculture has recorded substantial growth during post- independence period of planned development beginning with the First Five Year Plan in 1951-52. Despite significant growth in agricultural production, income disparities between the developed and underdeveloped agricultural regions in the country have widened.
Consequently, the Indian agriculture has been divided into two segments, firstly, dynamic or progressing and secondly, the backward and stagnating. It is in the latter segment, that little dent has been made into the basic problems of resource allocation, technology, marketing and media development. The Northeastern states of the country fall in the latter category where topographical heterogeneity and cultural factors act as constraints. Agricultural Production and Marketing in NE RegionSince the economy of the NE Region is essentially agro-based having 77 per cent of the working population engaged in agricultural operations, the development of agricultural marketing system bears considerable importance. The total foodgrain production in the region amounts to 430. 96 Lac tons in 1985-86, but very small quantity of marketable surplus is sold in the regulated markets.
According to an estimate, about 28 per cent arrival of paddy was recorded during the year 1987-88. Among cereals, paddy is the principal crop grown in the northeastern states, which occupies 63. 4 per cent share of the total area under foodgrains in the region. Maize is the next important crop grown in the NE Region except Tripura.
However, the pulses are cultivated in small quantities in all except Arunachal Pradesh. It shows that a major share of marketable surplus finds its outlet in the poorly equipped markets held periodically in the villages. Most of the transactions in the rural markets involve small quantity of agricultural Produce to purchase the commodities of daily requirements. The private traders, middleman, petty retailers and moneylenders locally known as ‘Mahajans’ dominate these markets.The bargaining power of the farmers is very weak and, therefore, the traders dictate the price.
One of the main reasons for prominence of traders in the agricultural produce markets in villages is the heavy indebtedness of the farmers to traders, commission agents and middleman. Besides the organizational and functional dimensions of the marketing system, the flow of commodities in the NE region is restricted and localized to certain specific areas due to geophysical conditions as well as lack of infrastructure facilities.Consequently, the factors of marketing such as pricing, backward and forward linkages, demand and supply of commodities are greatly affected to the disadvantage of both the producers and the consumers. The basic infrastructure facilities include storage and warehousing, road links, transportation and communication aids. Of these, storage and transportation network performs a significant role in stocking and mobilization of goods.
The storage facilities in NE Region are located mainly at district headquarters and state capitals.Till recently there were practically no rural godowns in the region. The National Cooperative Development Corporation (NCDC) has, however, pioneered the construction of rural go-downs work in the region. The existing marketing system is three-tier as in other parts of the country. The primary markets are held periodically at village level, wholesale assembling markets at block level and terminal markets located at towns and at the places from where the goods could be transported.The trade, however, is not regulated due to the absence of enforcement of market regulations in the primary and wholesales produce assembling markets. Among all the NE-states, Assam and Tripura have, to some extent, succeeded in the enactment of market acts to ensure efficient marketing of agricultural products. Marketing System Marketing of agricultural commodities in the northeastern states, by and large, is dominated by the private traders due to the absence of proper implementation of market regulation act by the state agricultural marketing boards.
Among the seven states in the region, Assam, Meghalaya and Tripura have market regulation act and of these only in Tripura it has been enacted and implemented to some extent for non-food grain crops like jute and mesta. In Assam, the implementation process is hampered due to various litigations put up by the traders. The agricultural produce marketing act in Meghalaya has been enacted but it is yet to be implemented while in Manipur preparation of the bill is in process. A brief description of the trade practices related to agricultural commodities in different states of the region is given below.Assam Assam is basically an agricultural state.
The rural population is about 89 per cent living in 21,995 villages. Out of the total rural population about 80 per cent depend directly upon agriculture. The overall economy of the state depends upon the agricultural development and, hence, agricultural sector has been receiving considerable attention in the planning process. Assam grows a large number of agricultural crops like paddy, pulses, oilseed, spices, fiber crop like jute, mesta and cotton and fruits and vegetables.Under the existing system of agricultural marketing in Assam, farm produces change many hands before reaching the consumer. The middleman, in the process extracts a large share of consumer’s rupee while the farmer gets only a small share.
Taking advantage of the farmer’s poor condition and weak bargaining power in the transaction, a set of middleman at different stages have emerged as a powerful channel for the procurement of food grains. They by and large, dictate the price.Thus, the farmer needs protection from such exploitation and also assistance in many respects, more so in a state like Assam where the agriculturists are subject to natural calamities and various other constraints. There are 1273 markets in Assam comprising primary and secondary markets. The farmers also sell their produce at the farm itself to itinerant merchants and such sales constitute about 60 per cent of the total marketable surplus. Of the remaining a certain percentage is also sold by the growers to village mahajans at their business premises.
The Dadan system is still prevalent in rural areas. Under this system, the village moneylenders advance loans to the cultivators at the time of need making it obligatory on the part of the farmer to deliver their produces after harvest at a price offered by the moneylender. Such price is much lower than the market price. The credit offered under this system is not less than 25 per cent of the total annual credit needs of the farmers in the state. There is no separate independent Directorate of Agricultural Marketing in the State.The Agricultural Marketing Schemes are being supervised directly by the Joint Director of Agricultural Marketing, Assam. Four schemes viz.
Development of Market Intelligence, Development of Marketing of Fruits and vegetables, Development of Jute Grading and Bailing and Development of Quality Control and AGMARK Grading are implemented in the plain districts by the Deputy Director of Agriculture (Marketing) with headquarters at Guwahati. In each market area, there is one principal market yard and one or more sub-market yards.The number of sub-market yards would be more in a market area as and when necessary, for the display of incoming produce. The State Government establishes a market committee for every area declared to be a market area under the provisions of the Act.
The duties and responsibilities of the market committees are clearly laid down in the provisions under the Act and Rules which mainly pertain to the collection of revenue, grading, forward trading, auction and price control and farmers’ welfare by providing all amenities in the market place.According to a survey conducted by the marketing board the farmers are losing at least 1 0 per cent of the market price due to lack of proper sale arrangements in markets. In addition, farmers do not undertake proper cleaning and grading of the produce before sales, which is also, one of the reasons for low price. Regulated markets take up such quality improvement measures to increase the value of the produces in the market. Properly cleaned and graded produce normally fetches a minimum premium of 5 per cent in the price as estimated.Adoption of the measures as envisaged in the regulated market scheme is expected to benefit the producer-farmers by about 20 per cent of the total value of the produce according to a survey report of the Marketing Board. Manipur Marketing of agricultural produce in Manipur has not been systematically organized. The lion’s share of the consumers’ rupee goes to the pockets of innumerable middlemen working in between the producer and the ultimate consumer.
The agriculturists of Manipur are generally the persons of small means. Their holdings are small and scattered.As such, they have got very little quantity of agricultural produce available individually as a marketable surplus to be disposed off. Obviously it becomes uneconomical to carry the small quantity of produce to the assembling markets located at distant places where middlemen operate at different stages. Under the prevailing practice in the state farm produce is collected Rural Marketing System in the Northeastern States 11 ACSI Consultancy from the producers in the interior villages and are brought to a central point, which is the assembling centre, by the womenfolk.Sometimes agriculturists sell their produce to the itinerant merchants. From the village markets it is procured by the itinerant merchants and agents of wholesalers belonging to towns such as lrnphal, Singjarnei, Thoubal, Kakehing, Bishenpur, Moirang, Churanchandpur and the like.
The transport that gives “place utility” to a farm product is one of the main problems in Manipur. As motorable roads do not properly connect most of the production areas, the farmers find it difficult to bring their produce to the primary and terminal markets for sale and thus deprive themselves of remunerative prices.In some interior areas, there is no road at all and even bullock carts as a means of transport for bringing farm products to the assembling centres cannot be used. Consequently, the farmers have to sell their commodities at a lower and uneconomical price to the itinerant traders at their farm itself. Regarding market charges, it seems that the prevailing system in Manipur is different than those prevalent in the unregulated markets in other parts of the country. In Manipur, the sellers have the advantage of not paying any charges like Gosala (Cattle Cess), Dharmoda (Charity), Dalaii (Commission).There are about 30 assembling markets and 103 primary markets and no regulated markets in the state.
Constraints. Road transport is the only means of transport for farm products to distant places as there is no rail link in the state. During rainy and few months of post-rnonsoon season water transport by boat is also used in some places. In the rnonsoon season due to bad road conditions and tear of landslides, the transport charges are very high. Again the cost of transport by road is not uniform as it varies according to the condition of the roads.Inadequate transport facility causes glut in the producing area and scarcity in consuming centres at times affecting both the producer for receiving in lower price and the consumer due to irregular supply and high retail price.
There is a general shortage of storage facilities in both the urban and rural areas of the state. The prevailing systems of storage in the rural and urban areas are quite primitive and they cannot be regarded as satisfactory. There are no warehousing and cold storage facilities.
Due to lack of storage facilities, the bulk of the agricultural produce is sold in the village.The itinerant traders and small merchants purchase the produce in village immediately after harvest. They either store it in the shops of the big merchants or sell the produce to the wholesalers or consumers. The big merchants purchase the produce and store it in their own godowns till better prices prevail and reap the benefits of escalated prices. As the farmers do not have the storage facilities and enough finance to meet their requirements, they are deprived of their genuine share in the price hike. . MeghalayaAgriculture is the main occupation in Meghalaya in spite of the fact that only about 10 per cent of the total land is available for cultivation in the hilly terrain of the State. About 82 per cent of the total population of the State live in rural areas and mainly depend on agriculture for their livelihood.
Paddy is the main food-crop grown in the state. Besides maize, wheat, millets and pulses, potato, jute and rnesta, cotton, mustard, ginger, turmeric, areca nut and betel leaf are some of the important cash crops produced in the state.Among the horticultural crops, banana, pineapple, citrus fruits mainly oranges are grown in abundance in medium and lower altitude regions and fruits like plum, pears and peaches are grown in the high altitude temperate region. Though the state is deficit in terms of food grains production, there is surplus cash crops and horticultural crops. Lack of proper marketing outlets in the State is a deterrent factor for increasing productivity and production. The production function is complete when marketing is so arranged that who is assured the producer of a fair return for the labour and other inputs investment made for producing a commodity.Unless a farmer gets remunerative price for the produce he will not go for increasing production. Meghalaya so far does not have the required base and the infrastructure facilities for organized agricultural marketing.
Marketing of surplus agricultural produce as well as the procurement of the necessary agricultural inputs and the daily requirements of the people in the State is a problem to be tackled. There are a number of constraints such as transport, communication, suitable organized marketing set-up, weak cooperative organization, and deplorable conditions of the primary markets in the rural areas of the state.Marketing of surplus agricultural produce and other minor forest produce, supply of essential foodstuffs, agricultural inputs etc. are mostly handled by the private traders. The traders are well organized and are in an. advantageous position that dictates their terms as far as the procurement of the surplus agricultural produce is concerned.
Farmers, in general, bring their surplus produce from distant villages to the market for disposal and at times, not being aware of the prevailing market trends resort to distress sales.As such the price situation of the surplus agricultural produce is very much fluctuating particularly for the perishable produce like, potato, ginger, fruits and vegetables. The middleman in the process takes advantage of the situation at the cost of the producer and the consumer as well.
Tripura The Tripura Agricultural Produce Markets (Amendment) Act, 1983 has been enacted for the establishment of the Tripura Agricultural Produce Market Board and subsequent amendment was proposed for the constitution of Market Committee of Regulated Markets to increase the number of members.The Tripura Agricultural Produce Markets (Administration) rules, 1985 was framed to allocate powers to the Marketing Board and Committees. In the regulated markets paddy and banana are notified as transaction able commodities. The paddy is admissible in the regulated markets in husked or raw form for transactions.
The transactions are made by open regulations between the buyers and the sellers. Rural Marketing System in the Northeastern States 15 ACSI Consultancy Some of the markets have been provided with minimum required amenities while the remaining markets have yet to be covered.The minimum basic facilities to be provided at the regulated market are: (a) Sale Hall (Auction platform), (b) Sale Stall, (c) Market Committee’s Office, (d) Godown, (e) Internal Brick lined pathways, including approach road, (f) Providing drinking water facilities, (g) Sanitary block with drainage system. Arunachal Pradesh In Arunachal Pradesh, there are no regulated markets and the whole trade moves around the private merchants who mostly procure the commodities at local markets in villages held periodically.The traders take the contract of standing crops particularly paddy and fruit and harvest it at their cost paying less price than prevailing market price. The cooperatives are mainly the distributing agencies for consumer goods and do not enter into the product market for procurement of food grains, fruits or vegetables. The itinerant traders visit the villages all the six days in a week and collect the produce from them. The conditions of the state do not allow for free and uninterrupted transportation.
Cooperative MarketingIn the northeastern states the cooperatives dealing with food grain marketing are weak in terms of organizational set-up and financial condition. The cooperative marketing societies in the region though established extensively, most of them are defective due to lack of marketable surplus of agricultural commodity and price manipulation by the private traders. In Assam, large number of cooperative marketing societies are not handling the procurement of agricultural produce. The State Cooperative Marketing Federation has also weak resource base and is dormant in marketing activities.Since the regulated markets and the cooperatives are not active in the state, paddy is mostly Rural Marketing System in the Northeastern States 16 ACSI Consultancy sold to the private traders. The Food Corporation of India is also procuring rice under levy from processors. Manipur The marketing of agricultural commodities in the state is largely unorganized.
In the absence of regulated markets for the agricultural commodities, the private trades have dominated the agricultural and horticultural produce marketing activities in the state.The idea to establish a parallel marketing institution through cooperatives has also received a setback due to reorganization of societies. Most of these societies have become defunct due to reorganization of Primary Agricultural Credit Societies (PACS). These reorganized PACS has taken up the marketing of agricultural products by their area of operation is very limited due to paucity of finances.
The main commodity procured by these societies is paddy. Though PACS are mains, the credit agencies in cooperative sector some of them have also taken up marketing as an additional activity.Meghalaya The cooperative marketing net-work in the state has been set-up for the horticultural production specifically for fruits like pineapple and orange There are 5 Horticultural Produce Cooperative Marketing Societies located within Pynursia block.. The members of these societies are engaged in procurement of horticultural and minor forest products and distribution ( consumer goods.
The commodity procured in these societies is Soli in the open market through its own outlets and private traders engage in wholesale and retail trade of fruits and vegetables. TripuraThe primary cooperative marketing societies are procuring specially jute, mesta and jute seeds, paddy and oilseeds grown by the tribe through Jhum cultivation. The cooperatives procure mainly from the members as sub-agents of Tripura Apex Cooperative marketing Society Limited under price support scheme. Paddy is the main crop among food grains which the societies are unable to procure it as the open market price of paddy is higher than support price and is dominated by the private traders. The societies are also engaged in distribution of essential commodities through retail outlets and fair price shops.Apart from primary agricultural produce Cooperative Marketing Societies there are also Large-scale Multipurpose Cooperative marketing Societies (LAMPS) mainly dealing with jute procurement. Problems of the Non-Farm Sector Enterprises Handlooms and handicrafts are the major non-farm employment and income generating activities in the rural areas.
The integrated action plan for promotion of these activities in the selected districts constitutes the identification of the craft and handloom weaving potential, economic linkages, infrastructure, technology and skill development and strategy for the overall development of the craft.Besides, the scope of the project includes also to develop bankable projects for providing credit to the artisans and handloom weavers in consultation with the local and specialized financing institutions like rural and commercial banks, SIDBI, NABARD and the like. Assam has largely the crafts culture of hilly terrain. The crafts of Assam which are popular across the states include cane and bamboo products, wood work , brass and metal work, toys and dolls and sholapith. Artisans were found not enterprising enough to sell or export the finished items on their own. Bulk of the finished output (91. %) was handed over to middlemen and/or traders. It was only bamboo craft , wood work and paper mashie industry that some exports were done by the artisans themselves.
Among the crafts, wage-earning artisans in the imitation jewellery craft received the highest wage rates. The daily wage rates were found to increase at an annual rate of 5. 9 to 6. 2 per cent during the last ten years. Income from handicraft activity formed 88. 2 per cent of their family income of a self- employed artisan and 72. 7 per cent of the income of a wage-earning artisan.
The common work sheds are not available to a large number of rtisans in the all the sample districts. The working capital is often insufficient for the artisans to procure the raw material and manufacture the marketable craft items for quick sales. The artisans do not have any technical and other support to lead their activities for establishing better marketing linkages marketing channels such as private traders, contractors and government emporia. None of the State Handicrafts Development Corporations in the selected states makes spot payments to the artisans in procuring crafts and it takes 45-60 days to settle the bills of the artisans.These Corporations largely procure the products of artisans on consignment basis. The marketing of handicrafts is also largely concentrated in the hands of the private traders. The study revealed that the weavers are largely facing problems related to production and marketing.
As stated in the pre-text, the high dependency on the master weavers and private trade linkages have put an operational crux of input supply and marketing among the primary handloom societies. Overview Agricultural marketing is a complex phenomenon.Involvement of a number of trade channels in the procurement of agricultural produce, the attitude of farmers towards the selling of their produce and to get immediate returns is the main factors governing the whole market operations. There are different types of problems in the marketing of agricultural and allied products pertaining to organizational, functional and physical infrastructure aspects. The organizational aspect is mostly concerned with the state intervention in agricultural marketing by implementing the market regulation as an instrument to offer better price to the farmers and feeble the lobby of private traders.The functional aspects are concerned with the bottlenecks found in transaction during grading, weighing, pricing, payment and other marketing operations.
The physical infrastructure in the northeastern region is weak in general. RURAL MARKETING SYSTEM IN ASSAM General Economy of the State The economy of Assam has been affected adversely for the past few years due to inadequacy of financial resources, insurgency problems and natural calamities like flood. At the current prices the net state domestic product (NSDP) recorded a growth rate of 9. percent in 1998-99 as against the growth rate of 10. 3 percent recorded in pervious year.
In respect of per capita income the growth rate was registered only 0. 4percent as against the growth rate of 2. 2 percent during 1997-98. The economy of the state is largely agricultural based and the growth in this sector has shown discouraging performance over the years. The flood problem of Assam, which is a regular feature during monsoon, as well as occurrence of drought at times continue to affect the agriculture and allied sector performance in the state.The share of agriculture sector in the NSDP at the 1993-94 prices was 37. 26 percent, which declined to 34.
11 percent in 1998-99. The manufacturing and processing sectors of the state has also showed an unimpressive performance during the late nineties. The processing of fruits and vegetables in the states is almost absent except a few private processing units of tomato and pineapple with meager plant utilization. The growth rate has also been found declining in the state, of rice and flourmills and oil mills.
The overall index of industrial production (Base 1970=100) fell from 202 in 1997 to 200 in 1998. In all, the economy of Assam is passing through growth setbacks in various sectors. Agriculture Agriculture occupies a very important position in the economy of Assam and forms the major occupation of the people of the state. According to 1991 census 69 percent population of the state was dependent on farming activity. Government of Assam has assigned high priority to the various programmes in this sector in view of its contribution to the state economy. .
Technology The agriculture technology development and dissemination has been entrusted to the Assam Agriculture University and over the years it has developed a variety of foodgrains, pulses and oilseeds to match the specific locations of the state. Specific varieties of the major crops have been developed to sustain the pre- and post- flood situation of the state and the package of practices have been developed accordingly. Marketing The Haat and the regulated markets are the two major channels existing in the state for marketing of agricultural produce.The cooperative network is very weak in the state and does not undertake procurement of agricultural produce. The farmers sell their agricultural produce in small quantity through the network of regulated markets in some places.
A large volume of foodgrains, oilseeds, cash crops and fruits and vegetables are sold in the state in the rural unorganized markets (Haat) held in the villages at regular intervals. The middlemen and private traders largely dominate these markets. There are 1237 rural markets existing in the state, which is the highest number in the Barapeta district.The regulated markets are located in urban areas and are 67 in number with minimum required infrastructure. The Assam State Marketing Board has various market promotion programmes for implementation.
Of these, creating suitable infrastructure at the market places is one of the prominent activities. The market committees in the state function as per the guidelines formed by the State Marketing Board. The committees function from their respective offices at the principal market yards and check the essential transactions and market management through their staff with the jurisdiction of market committee.
The market yards under the market committee are not yet functional in accordance to the Agricultural Produce Marketing Act and the decision on the control process of the markets is pending with the Government of Assam. The principal function of the market committee is collection of Cess and implementation of the provisions of the Act. It has been observed that all regulated market committees have piles of cases pending in the court of law as the provisions of the Act is being challenged time and again by the traders involved in the transaction of notified agricultural commodities.The rural markets are of traditional nature and many times the farmers are at a disadvantage in striking the bargain due to various economic reasons. Of these, the crop contract binding, indebtedness, need for cash, lack of adequate infrastructure are some of the major reasons of distress sales in the rural markets. However commission agents are found transacting the agricultural produce in the Haats. The contract farming in foodgrains, oilseeds and horticultural crops exists in the state in which the traders make advance payments to the farmers at the then prevailing prices and procure the produce from them on harvest.
The regulated markets do not have an elected body for the last three years and the members nominated by the Government of Assam manage the regulated market committees. The auction of the agricultural produce is conducted on the Haat day in the regulated markets in the state. The regulated market committees ensure that the payment of the purchased produce is made on the same day. However, the deferred payments are allowed to be settled within 4 days from the date of transaction. The regulated markets in the state are free from the middlemen as no license is issued to the commission agents to operate therein.
All the functions of regulated market committees are performed under the supervision of the agricultural department of the state. Only the notified agricultural produce including the foodgrains, oilseeds, pulses, fibers, spices, fruits and vegetables are permitted for selling in the regulated markets. Among foodgrains, paddy is a market deficit crop and is rarely brought to the market in significant quantity for sales. However, among the horticultural crops tomato has high surplus and is often sold in the market under distress.
The regulated markets in the state possess poor market infrastructure.However, all the market yards have the auction platforms. There are only three cold storages of 5000 MT capacities each available in the state in the private sector and godowns in the regulated markets or Haats for use of either farmers or traders. .
Cooperative Marketing The cooperative movement in Assam dates back to 1904 and has passed through various facets of change over the period and has yet to achieve success in its endeavor. At the end of 1996, there were 754 primary credit societies functioning in the state consisting of 707 Gaon Panchayat Level Sambhai Samitites (GPSS), Large Scale Multipurpose Cooperative Societies (LAMPS).There exist various commodity based non-credit societies, which include marketing, fisheries, dairy and consumer marketing activities. Among various non-credit societies 77 are primary marketing societies.
There were 771 primary consumer cooperative societies and 53 wholesale consumer cooperatives during 1996 in the state. The cooperative network is weak in the state and has insignificant contribution in procurement of agricultural produce, processing and marketing of agricultural inputs. A large number of societies are engaged in public distribution system.The apex cooperative body of the state, state cooperative marketing federation is functionally sick to provide any support to the primary societies. In the allied sector the fish and poultry production are in deficit and the marketing of these products are carried out by the business cartel directly.
The state government is gradually making attempts to restore the cooperative system in the state, which has been reflected in conducting the recent elections of the cooperative bodies. It has been found that about 80 percent of the primary agricultural credit societies have the elected representatives in the state.The fish and poultry products imported from other states are better in terms of quality and the market of these products is more organized in terms of price information, customer services, packaging and the like than the local products sold in the markets. RURAL MARKETING SYSTEM IN TRIPURA BACKGROUND Tripura is a small state in the northeastern region of the country. The terrain of the state is hilly and 70 percent is covered under small hillocks. The state has a large population of tribal community that stays in the hills.The people on hills are nomadic tribes and mostly marginal and sub-marginal farmers and those located on the plains of the state are better placed with the agricultural occupation. The distribution of farmers by the categories of land holding sizes is exhibited in Table 4.
1. It may be seen from the data that marginal farmers owning less than 1 hectare land constitute 68. 1 percent of the total land holders in the state. The figure 4. 1 exhibits the distribution of different categories of land size holdings in the size.The important crops grown in the state are paddy, jute and mesta, cotton, oilseeds like mustard, groundnut, sesame and the major horticultural crops consist of potato, pineapple, orange, jackfruit, cashew nut etc. Spices like ginger and turmeric are also cultivated in the state. Most of the foodgrains are consumed within the state to cater the needs of the local markets while other crops like jute and mesta, cotton, pineapple, orange, jack fruit, ginger and vegetable crops such as cabbage, cauliflower, potato are having considerable quantity of marketable surplus.
However, due to lack of proper marketing facilities available in the state the disposal of some of the important produce like jute and Mesta, pineapple, ginger and other vegetable crops is adversely affected. Agriculture A large area in the Tripura state is under forest, which occupies 57. 77 percent of the total geographical area. Agriculture in the state is largely practiced in a conventional pattern. The major food crop like paddy is cultivated largely in the plains of the state for domestic consumption. The land holdings in the state are largely fragmented and per capita land holding size is 0.
7 hectares. The single cropped are in the state is 1. 10 Lac hectares out of the net sown area of 2. 80 Lac hectares. The intensity of cropping in the state is 173 percent.
Agricultural Marketing There are total 555 rural and 30 urban markets in the state. All these markets have been provided with minimum required market infrastructure such as market sheds, yards, link roads through implementing a scheme of development of markets and marketing facilities. Of the above markets about 237 rural and 10 urban markets are located in the south district of the state.However, the accessibility to these markets is limited and in all, 53 percent of markets are accessible in all weather by road.
The Table 4. 4 shows the network of rural and urban markets in the districts and their status of accessibility. The ninth plan of the state further envisages the scope for similar programmes for the promotion of agricultural markets. The graphic presentation of the rural and urban markets in various distracts in the state is exhibited in figure 4.
2. The Table 4. 5, figure 4. 3 exhibits the distribution of various categories of markets in the state by various gricultural divisions. The storage capacity available in the state is for 1. 33 Lac MT under various organizations. The Food and Civil Supplies Department of the state owns the largest capacity of storage in the state that accounts for 28. 72 percent to the total available capacity in the state.
The Central Warehouse Corporation (CWC) provides 17. 28 percent capacity of the storage facilities to the total while the storage capacity in the cooperative sector and agriculture department accounts for 18. 41 and 20. 45 percent respectively to the total of the state.
The Table 4. exhibits the states storage capacity available in various organizations. All these organizations are having general type of storage facilities with them.
There is only 5000 MT cold storage available in the state owned by CWC, Tripura Apex Cooperative Marketing Society (TAMCS) and private sector. The TAMCS and private sector own 40 percent each of the total available capacity of the cold storage in the state while 20 percent capacity accounts for the CWC in the state. The storage available with the government departments is generally not provided for the farmers’ use.The cold storage charge for Potatoes is Rs 85 per quintal per season.
The transportation of agricultural and horticultural commodities to the rural and urban markets is mainly done by surface transport operated by the private agencies. The cost of transport is as high as Rs. 1. 00 per quintal per kilometer and the farmers experience 15-18 percent of transit loss in the fruits and vegetables transport due to bad condition of roads and poor transport facilities.
There is no scientific packaging of agricultural and horticultural produce is available in the state and almost all farmers practice conventional packaging for their produce.Among various commodities, paddy, rice, oilseeds, cotton, jute and mesta, fruits and vegetables, spices and condiments are the main commodities transacted in the rural and urban markets spread over the state. Cooperative Marketing The Cooperative Societies are voluntary and democratic organization based on equity, fraternity and common interest.
These organizations are formed by common people with a view to liberate themselves from the exploitation of stranger groups. There are as many as 1500 cooperative societies in Tripura during 1998-99 engaged in different activities.In tribal areas of the district there are 56 LAMPS, which are functioning, for the interest of tribal people and in plain land 213 Primary Agricultural Credit Societies and Farmers Service Societies have been formed mostly with the SC ;amp; OBC members to fulfill their objectives.
Besides, there are 14 Primary Marketing Co-operative Societies, which are actively participating in market of agricultural ;amp; consumers’ goods in rural areas. Due to paucity of resources with the state government the cooperative movement could not be thrived at the desired level.Yet the cooperative societies in the state are playing a vital role to hold the price line including the service to the common people by supplying essential commodities at a reasonable price. The Tripura State Cooperative Consumers Federation Limited, the Tripura Apex Marketing Cooperative Society Limited, Tripura Apex Weavers Coop. Society Limited, Tripura Fishery Cooperative Society Limited, and Tripura Milk Union Ltd are engaged in marketing agricultural commodities like potato/jhum seeds/paddy/other vegetable/jute etc/textiles including wholesale business of S.
K Oil/ medicine, etc.The primary societies have their linkage with Statefeds in procurement of agricultural produces, Jhum seeds, Jute and Mesta and Minor forest produces also in dealing with consumer goods. The primary societies are directly linked with the producer while for procurement of those commodities and act as an agent of State. Rural Marketing System in the Northeastern States 45 ASCI Consultancy As far as Primary Societies are concerned, they have infrastructural facilities available with them. They have their own storage facilities.
There are 213 go-downs owned by the different cooperative societies including a cold storage owned by TAMCs Limited.They purchase agricultural commodities, minor forest produces, etc. , from the producers and sell out these to the societies, which in turn store these commodities in their own godowns. Thereafter the Statefeds lift these from the societies by their own arrangement and the primary societies get a small margin.
AGRICULTURAL AND RURAL MARKETING IN MEGHALAYA Introduction Barely 10% of the total geographical area of 22,40,900 hectares reported for land utilization statistics is available for crop husbandry in Meghalaya while the availability of cultivable land as percentage of total area for the nation as a whole is a little over 55%.Just around 10% of cultivated area has access to any kind of irrigation which is again far below the national average of 37% and lesser than even the average for the North- Eastern region. Yet, nearly 70% of the state’s active workforce of 8,53,622 main workers out of a total population of 22 lakhs depended directly or indirectly on agriculture for their livelihood in 1997-1998 (Source: Statistical Handbook for Meghalaya-1998). Another 15% of main workers depend on other rural economic activities.Besides employment, agriculture and allied activities contributed at 1995-’96 prices to a quarter of the Net State Domestic Product of Meghalaya.
It is in this scenario where serious constraints exist to both expanding cultivable area as well as intensive cropping, coupled with the problems relating to geographical nature of the entire region and inadequate infrastructure, that marketing of agricultural and horticultural produce assumes critical importance for the economy of Meghalaya.Not only would the limited resource have to be exploited consciously for high value cropping but the system of marketing should support fullest realization of the value and more importantly its fair share to all the stakeholders. The same logic would also extend to other rural products like honey, bamboo articles, leather goods etc. Rural Marketing System in the Northeastern States 51 ASCI Consultancy Agricultural Marketing System Despite having a varied crop-mix within Meghalaya, the fact remains that the cropping pattern across the Northeastern region tends to be similar, leaving he state with a marketable surplus particularly of commercial and horticultural crops. There are 108 market centres in Meghalaya on record, variously managed by the Municipalities, Autonomous District Councils, Co-operatives and the Meghalaya State Agricultural Marketing Board (MSAMB) of which only two are wholesale markets regulated by the MSAMB under the ‘Meghalaya Agricultural Produce Market Act’, 1980. The district-wise break-up of the agricultural markets may be seen from Table 5. and Figure 5.
2. Rural Marketing System in the Northeastern States 53 ASCI Consultancy But for the two wholesale market yards, one each at Mawlong in the East Khasi Hills district and at Garobadha in the West Garo Hills district, which are not yet fully operational, almost the entire marketing system is unorganized in the form of traditional ‘Haats and weekly bazars’. This renders the job of determining the commodity-wise and district-wise marketable surplus very difficult.
The situation is further compounded by the fact that a chain of middle-men operate as transporters and traders between the farm-gate and the markets within the state as well as outside including the markets in neighboring Bangladesh. Post Harvest Support Systems Basic infrastructure, hard and soft, for post harvest management of agricultural and the more perishable horticultural produce is grossly inadequate which leaves the producers without any bargaining power at the marketplace.There is no cold storage facility in the state, either in the private or public/co-operative sectors despite the fact that perishable commodities like Pineapple, Oranges, Banana, Potato, and other seasonal vegetables are grown as mentioned earlier.
The farmers generally store their produce temporarily in bulk or in bags at home in kutccha godowns or in underground circular pits. Matting prepared from straw bamboo strip or other suitable materials is used to protect against moisture and damage.No information was available on the actual losses suffered by farmers due to lack of scientific storage facilities and awareness on the part of farmers, but it would certainly be well above the national average. Government supported organizations like State and Central Warehousing Corporations, Meghalaya Apex Co-operative Federation, Food Corporation of India, MSAMB and others have constructed few godowns but these storage facilities are utilized fully by the respective organizations for their own businesses or for other institutional customers.For instance, the State Warehousing Corporation and the MSAMB own 11,000 and 5,000 metric tons of storage capacity but the same is hardly available to individual farmers and even if made available, the rental charges of Rs. 2. 00 per square foot per month is felt unaffordable by the farmers.
Rural Marketing System in the Northeastern States 54 ASCI Consultancy It is expected that the two wholesale market yards at Mawlong and Garobadha would soon commission their cold storage units of 1000 metric tons each and also other storage, resting, parking, sanitation, water supply, banking, grading and auction platforms for farmers and traders.This backed with adequate soft measures like publicity, extension and training of both farmers and MSAMB staff in grading and handling should help attract larger arrivals of farm produce and yield better returns to the producers. Transportation and transit losses are another major burden on the farmers in view of the difficult terrain and kutccha roads. The produce is generally brought from the farm or home to the roadside by head load in bamboo baskets or in gunny bags.
Later the produce is repacked either in bigger bamboo baskets or gunny bags each weighing 50- 60 kilograms and in the process of handling, items like tomato, orange, pineapple etc. suffer heavy losses in quality and weight. This can be reduced to a great extent if the farmers are encouraged to use plastic crates for packing. Since speedy movement of perishables to markets is important, private transporters charge the farmers exorbitantly.
To help the farmers in this regard, the MSAMB is operating two mini-trucks for transporting farmers’ produce from farm to market at nominal prices.Export Promotion Cross border trade between farmers and traders of Meghalaya and neighboring Bangladesh is fairly vigorous though official figures data cannot be compiled. This has its roots in the pre-independent free trade that the people of the State used to have with the markets in East Bengal (now Bangladesh). However, after the partition, closure of border haats and bazaars on either side of the borders has affected the volume of trade but old trading relationships continue to operate.In view of the South Asian Free Trade Area (SAFTA) becoming a reality soon, and the demand for citrus fruits mainly oranges, banana, pineapple, tezpatta, areca nut, betel leaf, jackfruit and other products from Meghalaya in Bangladesh where competition from other South Asian exporters would be imminent, the Government of Meghalaya should create a separate export arm in the MSAMB as a preparatory measure.
PERCEPTIONS OF FARMERS ON RURAL MARKETINGThe economy of the northeastern states is largely agriculture based and with a small percentage of population engaged in the non-farm activities like handlooms, handicrafts, rural industries, services and business. The marketing of farm produce and non-farm products is largely unorganized in the region. However, efforts of institutionalizing the agricultural marketing activity in the states of Assam, Meghalaya, Tripura, Manipur and other states in the region have been made continuously by the respective governments of the states.The private trade channels in the agricultural produce marketing and the non-farm sector products marketing are predominant in the region in general and the selected states for the study in particular. The institutional interventions are made in the marketing of agricultural produce through the regulated markets, cooperative organizations and processing activities managed under the government and public sector undertakings. Marketable SurplusAmidst various constraints in farming in the northeastern region a small number of farmers are not satisfied with the production and marketable surplus, they get out of their land.
The Table 6. 7 exhibits the marketable surplus of major crops grown by the respondents. About 50 percent of the respondents stated that they are satisfied with the production and marketable surplus derived from their land despite physical and financial constraints in farming activity observed in their village. The status of marketable surplus of major crops across the sample status is shown in figure 6. 1.
Marketing Marketing of agricultural produce in the northeastern region is a major problem due to infrastructure and lack of alternative channels available with the farmer. It has been observed that the private traders procure the farm and non-farm produce at the village through their agents. The farmers also feel convenient to dispose off their produce at the village as it save their time and energy in transporting the produce to the urban markets. Marketing Practices The large number of itinerant traders who procure the farm produce including the fruits and vegetables attends such markets.The traders who have informal contract agreements of procuring the cereals, fruits, oilseeds (Mustard) purchase from the farmers soon after the harvest at their doorsteps and 16 to 30 percent farmers stated that they have such practice. However, it has been found that about 32 percent of the respondents stated that they take their foodgrains to the regulated markets for sale.
The itinerant traders in the rural market also play a significant role in agricultural marketing as about 65 percent of respondents stated that they used the itinerant traders as the channel for marketing their food and fruit crops in the village market.These traders also visit the regulated market on a scheduled date for holding transactions. As discussed earlier the transaction pattern in the rural markets shows two categories, firstly, the traders purchase agricultural and horticultural produce against the money advanced to the farmer for agricultural operations. Under such deal the farmer is also at the disadvantage as he has to compromise for the lower pre-harvest price and adjust more volume of the produce towards the interest of the debt availed Secondly, the farmers sell their roduce to the available channels in the village at comparative by lower price than the urban markets in order to avoid the problems of transport. Logistics The farmers and village entrepreneurs face major problem in transporting their produce/-manufactured goods to the urban markets for sale at remunerative prices. It has been observed that over 50 percent of the farmers and entrepreneurs transport their saleable on head loads, as the public transport in the region is expensive and many times inaccessible from the village.The movement of goods through the trucks is very limited due to terrain conditions. The Table 6.
11 exhibits the movement of goods in Rural Marketing System in the Northeastern States 65 ASCI Consultancy the region. The head loads are carried to a distance of 5-10 kilometers on an average to reach the rural market or a point from where the motor transport is available for transporting the goods to urban or terminal markets. The figure 6.
4 depicts the rural transport patterns in the sample districts. The Table 6. 2 reveals the distance travelled by the farmers and entrepreneurs with their non-farm goods to reach the market. The transit loss of small volumes of food crops amounting to less than 10 percent of the total produce transported, and 28. 1 percent of oilseeds in Kamrup district has been reported. The transit loss for the same crops was borne by over 50 percent of respondents in the East Garo and North Tripura districts. The accessibility to the rural and urban markets in the study region is shown in figure 6.
5. The Table 6. 13 shows the status of transit loss of various crops as observed by the respondents.It may be seen from the data that the transit loss was found to be higher in case of fruits and vegetables due to improper packaging and lack of adequate knowledge of post-harvest management. Market Information System It has been observed that in the rural markets in the northeastern region the marketing activity is largely dominated by the private traders and often the rural producers suffer from the distress sales. There is no awareness among the farmers and entrepreneurs in the non-farm sector about the prices in the neighboring markets and under such circumstances the rural producers largely accept the price quoted by the traders.
It was found during the study that 56. 3 percent and 45. 8 percent respondents were aware of the market prices in Kamrup and East Garo districts while awareness on prices was found lowest with only 27. 6 percent respondents in the North Tripura district. The Table 6. 14 exhibits the sources of market information available to the farmers and other non-farm sector entrepreneurs.
It may be seen from the above Table that the information is gathered through inter-personal communication of the fellow farmers and entrepreneurs.The traders also help in disseminating market information and the data reveals that above 30 percent respondents were aware of the market trend in terms of quality and prices though this channel. The government and media were found to be an Rural Marketing System in the Northeastern States 66 ASCI Consultancy ineffective channel for providing market information according to the primary data of the study.
Marketing Decisions It has been found during the study that irrespective of market information the farmers dispose off their produce immediately after the harvest is over for various economic reasons.The Table 6. 15 shows the trend of disposal of marketable surplus by the farmers. It may be observed from the data that the a large number of farmers dispose off the marketable surplus of their produce immediately after the harvest, however, about 20 percent of the respondents revealed that they hold back the surplus in anticipation of the better price in the future.
The marginal farmers were found disposing off the surplus in small quantities in the market as per their monetary requirement. The attitude of farmers in disposal of agricultural produce is shown in figures 6. 6.It has been observed during the study that the farmers have not build-up their attitude to sell their produce in the regulated markets. However, during glut of the produce or low demand in the private market the farmers pursue the agricultural marketing authorities to help in selling their produce. The regulated markets have not attracted the farmers to identify this channel as the most beneficial channel for various reasons. The farmers do not get the desired facilities in the regulated markets like storage, grading, and help in negotiating better price for the produce.
The Table 4. 6 details the farmers’ perceptions about the facilities used by them in the regulated markets. It may be seen from the data that farmers are not happy about the room storage and cold storage facilities provided at the regulated markets. However, the display platforms for the produce has been well constructed as opined by the respondents of the study. It has also been stated by the respondents that there is no intervention of the staff of the regulated market committees while negotiating the price with the traders, as there is no auction system prevailing in the study region.It has also been stated by the respondents that the agricultural inputs like seeds, fertilizers and pesticides are not sold in the regulated market premises, as is the practice in many states other than the northeastern region.
The Table 6. 17 exhibits Rural Marketing System in the Northeastern States 67 ASCI Consultancy the channels of input supplies and the buying practices of the farmers thereof in the study region. The data reveals that about 50 percent of the farmers buy agricultural inputs from the traders.The cooperative societies in the regions sell small volume of fertilizers to the farmers. Grading and Packaging It has been observed during the study that the farmers do not possess adequate knowledge about the grading the produce and its impact on the price.
The traders also do not grade the produce at the village market level. However, the physical grading is done by the traders at the terminal markets for forwarding the produce to the other markets and processing units. The Table 6. 18 exhibits the farmers’ views on grading their agricultural produce.It may be observed from the above Table that about 40 percent of the respondents of Kamrup district of Assam stated that the physical grading of the produce is done at the farm level by the farmers while in the East Garo and North Tripura districts such activity has been taken up by a small number of farmers. However, about 26 percent of the farmers stated that the traders did grading of the produce at the time of buying for the convenience of differentiating the price and the sometimes the crop was graded by the variety of seeds used.As stated in the state profiles of the selected states for the study in the previous chapters, the packaging of the foods and fruit crops at the farm level is conventional and suffers from quality deterioration and transit loss. It has been observed during the study that the over 70 percent of the farmers use bamboo baskets for storage and transportation of cereals and fruit crops.
Only the large farmers use jute bags for storage and transportation of food crops and oilseeds. About 20 percent farmers have stated that they use jute bags for transporting the produce to the market.The traders provide jute bags to the farmers who abide with the informal agreement of supplying the produce to the traders. Rural Marketing System in the Northeastern States 68 ASCI Consultancy Problems in Agricultural Marketing All farmers have stated that they are not satisfied with the existing arrangements of rural markets in terms of their physical infrastructure, coverage of villages, accessibility and market information system. The farmers and entrepreneurs feel that there is a large number of villages, which are not connected to the rural markets and are deprived of in transacting the farm and non-farm produce therein.The rural godowns are not available either at the panchayat level or in the district headquarters for storage of the produce. A large number of farmers are not aware of price movements in the principal market yards within the state and the neighboring markets as official channels are out of reach of the farmers.
The farmers in large number are in favour of contract farming as the traders assure procurement though the price paid is lower than the price existing in the market.However, the advantage stressed by the respondents in the contract farming is the advance money paid by the traders at the time of sowing operations which helps them to a large extent in meeting their input costs. The respondents as an inactive agent feel that the regulated markets in the entire states do not provide desired services to the farmers. In all, it may be stated that the private traders are predominant in the marketing of produce of farm and non-farm sector in the region. Promoting Agribusiness Marketing ChannelsIn agriculturally progressive areas, agriculture has become big business. The farmer is more and more a manager, running a business organization, which may be part of a huge corporation or cooperative based soundly on chemistry, biology, engineering, and economics.
The goal is the same as for any businessman: to maximize profits. The agribusiness manager must be alert to government programs and regulations, must be aware of the newest varieties and growing techniques, and must be knowledgeable about pesticide hazards and hundreds of other details.Every segment of the operation is examined. The most select crop variety suited to soil conditions is chosen; special fertilizer is blended for maximum growth and yield. Chemical weed control is practiced. Irrigation may be used. Pesticides are applied at the best times. All of these have been done by farmers in the past, but now many of these activities are organizations like cooperatives through mutual efforts.
Marketing has changed as much over the years as other aspects of farming. A decade ago much of the farmer’s output was sold and consumed at the nearest marketing town.The farmer might also deliver barrels of potatoes and oranges directly to nearby homes. In most parts of the NE states, Farmers still carry their small surplus to a town market where they trade or sell it to their neighbors. The roadside vegetable stands and farmers’ markets are the chief remnants of such direct trade between farmer and consumer. In general the modern farmer’s output reaches the market through the hands of many businesses that buy, store, transport, process, package, and deliver it before it is sold to the consumer.This system is necessary because people use few commodities in the form in which they come from the farm.
A farm’s product may be also used thousands of miles away, completely changed in form. More than a million commercial firms are engaged in agricultural marketing and processing. The people who handle farm produce en route to the consumer must be paid. Ideally, about 70 cents of every rupee people spend for farm commodities go to the people who buy, handle, sell, package, and advertise it. This should leaves about 30 cents for those who raise the produce, for gaining remunerative price.To have an alternative dealing with commercial buyers and processors, farm groups often organize cooperatives for the processing and selling of their produce.
The extra profits are shared among the cooperative members. Farm cooperatives should also do business with items as fertilizer, seed, and gasoline in large, money-saving quantities, then sell them to members, passing along the savings. Understanding the Market To sell produce most advantageously, the farmer needs to understand the market for particular commodities. The farmers organizations like cooperatives, self help groups, etc. should provide information on prices and related marketing variables. Farmers must be provided with price trends to determine the most favourable time to sell.
Various agribusiness services organizations issue reports on the production and prices of crops and livestock for use of farmers. They also forecast future output and furnish market news to newspapers and radio broadcasters. Boards of trade, or commodity exchanges, issue reports of prices for current sales and futures on grains, cotton, soybeans, and other commodities. The cooperatives should have access to such interactive sources.The farmer can increase profits by producing commodities that meet high standards.
The Agricultural Marketing Board can play an important role in setting standards and grades for agricultural products. Commercialization of Agricultural Activities: Commercial vegetable production and marketing can lead to disaster for the uninitiated and those who cannot afford to take the risks involved. Although these risks can be minimized by careful marketing and production planning, they can never be eliminated entirely. Many studies and surveys show that many opportunities exist for expansion of fresh vegetable production but they are under-used.Although few producers may abandon the guaranteed prices of food crops and markets for the risks in commercial fruits and vegetable production for high price and quick realization of output. In NE States more adventurous farmers have so diversified, that vegetable production has become their dominant farm enterprise.
For many of these growers market opportunities and farm income are not increasing at anticipated level but the cooperatives and SHGs can make them profitable by taking some control of it. . Joint Marketing and Production Decisions Two major obstacles to success in vegetable production are finding markets and establishing prices.
Some producers, attracted by success stories about a particular crop, have carefully researched and grown it. Unfortunately, they never bothered to determine where, to whom, and at what price their products would be sold. Good marketing plans start with the customer and work backwards to production. Potential growers should first determine exactly what buyers want, how they want it, and when they want it.
Then, they should determine how these crops should be grown. Even selecting varieties and determining planting times are basic marketing decisions.Rural Marketing System in Northeastern States 133 ASCI Consultancy Playing by the Rules For wholesale market channels, growers must play by the buyer’s rules. Wholesale produce buyers in the state are well established and are able to obtain products from a variety of sources around the country. Unlike tobacco companies, they don’t need the grower’s political support. Long-established marketing conventions in the fresh produce industry are unlikely to bend to accommodate new Kentucky growers. The key to success in produce marketing has always been the establishment of good relationships with buyers over time.
New growers, in many cases, will have to prove to potential buyers that they are serious about the business and are able to grow, grade, pack, and in some cases, pre-cool produce in the way the buyer specifies. Unfortunately, high transportation costs make local produce less attractive to buyers out side the state. However, local consumers have more interest in buying fresh, high quality vegetables—part of a rising national demand for fresh, locally-grown products. The demand for fresh products from local growers is also increasing nationwide.
At least one large supermarket chain across the NE States can store in feature, the locally-grown produce and apparently would like to feature more value added horticulture products. Consumer interest in fresh F ;amp; V is creating more demand and opportunities for both direct and wholesale marketing. Counting the Costs Despite the apparent opportunities and favorable signs, vegetable production is certainly not for everyone. Day-to-day production decisions regarding pest management, irrigation, and other cultural practices are critical.
To help current and prospective growers evaluate their opportunities. Table 8. exhibits comparative Marketing Options for fruits and Vegetables. The growers should pay particular attention to comparisons of marketing time required, compatibility of off-farm employment, and compatibility with tobacco production.
Individual situations vary, and producers must often learn about their particular markets by starting small and getting a foot in the door. The Agribusiness planting decisions should be based on information from several sources, especially of potential buyers, experienced vegetable producers and farmers organizations, and explore what marketing approaches have worked for them.The cooperative and agricultural extension service is another source of information that can be used although vegetable marketing may be unfamiliar to Rural Marketing System in Northeastern States 134 ASCI Consultancy some Extension agents. (See the “Getting Help” section in this publication for more information about help through the Cooperative Extension Service and other organizations. ) Choosing a Market Among the main factors influencing success and individual growers’ choice of marketing, the prominent options are: ?? marketing alternatives and facilities available in the area ?? time available for marketing ? potential production volume ?? adequate financing ?? commitment and attention to details of marketing channels. Direct Marketing Direct marketing—marketing directly to consumers—includes sales at local farmer’s markets, on-farm markets, roadside stands, farm festival markets, pick-your-own sales, or any combination of these methods. All forms of direct marketing, with the exception of pick-your-own, appear to be expanding in as well as other states in the region. Prices at local farmer’s markets are usually higher than wholesale prices, but more marketing time is required by individual growers.Supermarkets and kiosks in urban centres have become popular forms of direct marketing. Community-supported agriculture marketing This a term for marketing by participation through self help groups. Individual growers or a group of growers solicit members within a community who pay a minimal monthly or seasonal fee to participate in a specified mix of fresh vegetables sales on daily or weekly basis. On the contrary, the group also identifies the community as regular buyer on payment of a fixed subscription apart from the price decided for vegetables/fruits by the SHG.Produce auctions have been popular for small growers in many agricultural produce marketing committees. Growers bring produce to the auction facility, where it is sold to the highest bidder. The auction company (sometimes a growers’ organization) charges a flat commission of about 10 percent. Both large and small lots are accommodated at some auctions. At the largest Pennsylvania auction, most of the bidders are operators of medium-to-large retail produce markets and stands.Growers can sell small volumes at a produce auction without having to spend much time in marketing. Serious vegetable production requires serious investment. Plastic mulch and drip irrigation have become standard practices for many vegetable crops. Marketing Cooperatives A marketing cooperative is just one form of indirect marketing in which the producer deals with an intermediary rather than the final consumer. Although most forms of indirect marketing require less time of individual growers, they usually demand more product uniformity, quality, and post harvest care.Grower-owned cooperatives or marketing associations are able to assemble truckloads of produce required by large customers, which would not be possible for small growers acting individually. Formally organized cooperatives may also provide technical assistance to growers and help secure seeds, boxes, and other needed supplies. In some cases, specialized equipment is shared by growers. Co-ops usually own and operate facilities with some combination of grading, packing, cooling, and storage equipment for their members.Members typically employ a manager to oversee the co-op’s daily operations. Several small growers cooperatives with grading, packing, and cooling facilities can be formed as exists in Maharashtra and Gujarat. They offer good marketing opportunities for new growers in villages near the co-op facilities. Diversity in Vegetable Marketing Many cooperatives and private organizations are identifying ways to increase the sale of their F;amp;V produce and to promote the attributes of health and freshness of their farm produce.Mention may be made of HOPCOMS, Safal and Fresh brands which are marketing the products on large scale as well as promoting their brand through various tie-up strategies. Several new direct marketing mechanisms have been developed or expanded such as produce auction markets, buying clubs, community farmers’ markets, wholesale distribution centers, and marketing cooperatives. The large commercially oriented cooperatives offer labeling designated for fresh produce grown in the villages and provide an organic certification to the products for customer awareness and quality guarantee.Such program for farmers to promote their vegetables as organically grown have also been taken up by these organizations. These organizations have a advertising and promotion program for their retail out lets. F&V growing farmers have profitable enterprises in tomatoes, pumpkins, cabbage, peppers, and sweet corn, and interest in vegetable production will likely continue to increase. As the market and production segments continue to enhance, many farmers organizations may form partnerships or expand their operation to compete in the wholesale markets.Others may look for opportunities in the local direct sales of produce. While direct marketing can be a way for farmers to keep a larger share of their profit, it may also limit the growth potential in their operation. Consumers can benefit from the greater selection of fresh produce both at retail and direct market outlets, such as farmers’ markets. Typically, these markets have six to ten farmer members in SHGs who sell produce. Members typically meet collectively the marketing costs. Consumers, approach individual growers to purchase a variety of produce ranging from cereals and vegetables.Produce may be sold by weight or by the count. Some markets have special events with activities that promote farm produce, and some offer fresh produce and value-added products such as homemade breads and jams and jellies as is organized by Khadi and Village Industries Commission and Agriculture and Processed Food Export Development Authority in the country. Buying clubs comprising hotels, institutions, restaurants and service kitchens are one of several new marketing mechanisms for selling fresh produce directly to consumers.A variety of produce may be offered during the season. For example, a typical spring box ( For all F;amp;V of the season) includes turnips, beets, cabbage, potatoes, spinach, strawberries, leaf lettuce mixes, radishes, broccoli, peas, and tomatoes. However, weather conditions may affect the availability of some of the produce. The Rural Marketing System in Northeastern States 139 ASCI Consultancy advantages of the buying club approach is that consumers help share the production costs with the farmer in return for a steady supply of fresh produce during the season.Home delivery can be convenient for time-conscious consumers, and the buying club approach gives farmers a predetermined, consistent market and customer base. Such marketing approaches through clubs may be promoted by the self help groups and large scale business cooperatives. The National Dairy Development Board can consider implementing the F;amp;V project in the north eastern states alike Delhi in order to promote small cooperatives in the region. Promotions for Categories of CooperativesGenerally, there are three types of agricultural cooperatives: marketing, supply and service. Marketing Most farmers do not produce enough volume to allow direct business with wholesalers and retailers of their products. Together, through their cooperatives, producers can market their products efficiently and meet consumer demand. Today’s cooperatives integrate processing, canning, concentrating, freezing, packaging and storage of dairy, grain, fish, meat, poultry, fruit and vegetable products.The cooperative assists members in meeting market and government standards for their products. Marketing cooperatives assist members maximize the return they receive for goods they produce. Most cooperative marketing activity involves either agricultural products or those of producers in related industries such as forestry, aquaculture and horticulture. New marketing ventures are developing in such diverse industries as handicrafts, professional services and information technology. Some marketing cooperatives limit their activity to negotiating prices and terms of sale with buyers.Growers of fruits and vegetables for processing and dairy farmers are primary users of these cooperatives, called bargaining associations. Other marketing associations assemble member production into large quantities for sale to further processors, wholesalers or retailers. This first-handler role is common for cooperatives of grain growers and producers of fruits and vegetables for the fresh produce market. Other such associations add further value to member production by processing or manufacturing member products into other, more valuable products.These may serve as ingredients in further processed products or be sold to institutional buyers and restaurants for their direct use, to grocery chains for resale as private label products, or to brand-name companies for resale under their brand. Rural Marketing System in Northeastern States 140 ASCI Consultancy Cooperatives that process dairy products, fruits, vegetables, grains, fish, and lumber exemplify these value-added processing activities. Still others put member products right on the grocery store shelf under their own brand name.Land O’Lakes, Sunkist, Ocean Spray, Welch, Tree Top and Knouse Foods are examples of cooperatives with established brands. Marketing cooperatives enable members to extend control of their products–and realize additional margins–through processing, distribution and sale. Supply Supply cooperatives allow members to pool their resources to buy production supplies including seed, fertilizer, petroleum products, farming equipment, heating oil and hardware for farm businesses. Quantity purchasing realizes savings and assures quality for the cooperative members.These cooperatives frequently affiliate with other cooperatives in the United States and overseas to own phosphate deposits, fertilizer plants, research laboratories, petroleum refineries and other similar facilities cooperatives were first used by farmers to gain access to affordable, quality production supplies such as feed, fuel, fertilizer and seed. These early efforts often became businesses having fulltime managers and warehouses to handle other production supplies and services such as farm chemicals, animal health products, fencing, building supplies, construction contracting, automotive accessories, etc.Many local purchasing cooperatives have affiliated with other such organizations, often through regional and national federated cooperatives. These efforts reduce member costs and strengthen their purchasing power through direct ownership of large-scale facilities such as petroleum refineries; phosphate, potash, and nitrogen manufacturing plants; feed mills; research facilities and laboratories. Today many non-farm businesses have developed supply purchasing cooperatives to gain access to the same volume discounts and quality control assurances long available to farmers.These include hardware stores, independent grocery stores and fast food restaurant franchisees Service Working in conjunction with other types of agricultural cooperatives, service cooperatives provide specialized programs such as feed mixing, pesticide applications, crop harvesting, artificial breeding and dairy herd improvements for their members. Service cooperatives were also developed to serve farmers. Some of these services are farm-specific, such as recommending and applying fertilizer, lime, or pesticides; animal feed processing; and crop harvesting.Others are general in nature, such as credit through the Farm Credit System, electricity through rural electric cooperatives and communications Rural Marketing System in Northeastern States 141 ASCI Consultancy service through rural telephone cooperatives. Nonagricultural service cooperatives are also flourishing. Credit unions and the National Cooperative Bank provide credit on a cooperative basis to non-farm individuals and cooperatives. School systems, health care providers, and insurance buyers are among the general public segments making use of service cooperatives. Unique service cooperatives include: ? The Farm Credit System, owned by its borrowers, providing credit to agricultural producers and their cooperatives, and regulated by an independent governmental agency. ?? Rural electric and telephone cooperatives providing electricity and phone service to their members in the rural areas of the United States. These cooperatives were formed when investor-owned utilities were unwilling to serve rural low-density areas. DIRECT MARKETING ACTION PLAN Collectively, the plan is designed to enhance small farmers’ ability to thrive in their businesses by facilitating the marketing of their agricultural products.Farmer direct marketing, or growers selling their farm products directly to consumers, has been gaining popularity in recent years. Direct marketing includes farmers markets, pick-your-own farms, roadside stands, subscription farming, communitysupported agriculture (CSA), and kiosk sales. Farm products sold through direct marketing include fruits, vegetables, nuts, honey, meats, eggs, flowers, plants, herbs, spices, specialty crops, and valueadded products such as maple sugar candies, cider, jellies, preserves, canned food, and firewood. Direct marketing is especially beneficial to small farm operators.Nearly 1. 9 million farms, or 94 percent of all farms, qualify as small farms. Through this plan, Agricultural Marketing Service(AMS), cooperatives and F&V SHGs will facilitate cooperation and collaboration among agencies and organizations that promote direct marketing and help small farmers benefit from the growing consumer interest in direct marketing. The plan will enable AMS to: ?? Identify farmer direct marketing issues and opportunities for small farmers. ?? Promote the development and operation of farmers markets and other marketing activities which support small farmers. ??Serve as a one-stop information source for farmer direct marketing activities. Rural Marketing System in Northeastern States 142 ASCI Consultancy ?? Conduct, support, and promote research in farmer direct marketing. As this plan becomes fully implemented, AMS will be able to identify and coordinate solutions to many of the challenges small farmers face in marketing their products. Consumers will benefit through a fresh supply and wide variety of farm-fresh products. Society will benefit from a strengthened bond between grower and consumer, a more sustainable agricultural base, and the continued heritage of the American small farm.Within 5 years of implementation of this plan, accomplishment of the above objectives may result in: ?? Establishing a principal contact at Apex cooperative organizations for information regarding farmer direct marketing. ?? Creating new direct marketing networks and identifying and responding to marketing issues affecting small farmers by sponsoring an annual forum of farmers market managers and conducting regional focus groups. ?? Establishing a one-stop farmer direct marketing information clearinghouse for handling inquiries and routing calls to appropriate sources. ??Establishing a directory of all active farmers markets, which will be maintained at the website, with a new directory published in July of each year. ?? Developing a training program for managers of farmers markets and marketing information programs for small farmers, which will be available electronically or through distance learning facilities. ?? Feasibility studies for year-round farmers market facilities. ?? Increased participation by limited-resource, women-owned, and/or minority-owned farms in direct marketing. Development of Marketing Infrastructure for FarmersImmense agro-climatic diversity enables India to grow a large variety of horticulture crops that include fruits, vegetables, flowers, spices and plantation crops. From organized upland tea and coffee plantations to extensive and often dense coastal strips of coconut trees as also the sub-terrain tuber and root crops characterize the variegated nature of the horticultural potential in the country. The country holds the first position in global production of bananas, mangoes, coconut and cashew and is amongst the first ten in citrus, pineapple and apple production.India holds first position in global production of cauliflower and is amongst top ten in production of potato, tomato, onion and green peas. MARKETING EXTENSION TECHNIQUES Farmer teaches farmers A successful farmer explains to a group of farmers his production and marketing practices. The meeting is most effective on the farmer’s own farm. Demonstrations Practical demonstrations of techniques such as harvesting, cleaning, grading and packing, preferably taking place on a farm. Prepared samples which demonstrate the differences overtime of different handling practices can be effective, as are samples of competing produce and photographs.Study on Rural Marketing System In Northeastern States ASCI 161 Consultancy Talks and seminars Possible topics include: market possibilities successful case studies, postharvest techniques, prigs assessment, market-oriented production techniques. Buyers and middlemen should be involved to talk. Problem-solving techniques The farmer group is encouraged to identity its own major problems. The problem solving can be tackled systematicaly, by calling In specialists individually to advise the group or by forming a panel to answer farmers’ questions.Alternatively, the group might be encouraged to decide their own solutions which they then implement themselves collectively. Study tours Farmers are taken on a study tour to make their own contacts and to see the market for themselves, visit processing centres and observe how their produce withstands transportation. Farmers visit farmers in another area to exchange experiences and see new techniques. This experience alone can transform a grower’s views on production and marketing. General ScenarioThe economy of the northeastern states is predominantly agriculture having 77 per cent of the working population engaged in cultivation and the role of agricultural marketing system has considerable importance in the overall economy of the region. It has been found that the in the selected states there are large number of unorganized rural markets and the private traders hold the core agribusiness activities in the region. It shows that a major share of marketable surplus finds its outlet in the poorly equipped markets held periodically in the villages.Most of the transactions in the rural markets involve small quantity of agricultural Produce to purchase the commodities of daily requirements. The private traders, middleman, petty retailers and moneylenders locally known as Mahajans dominate these markets. The bargaining power of the farmers is very weak and, therefore, the traders dictate the price. One of the main reasons for prominence of the traders in the agricultural produce markets in villages is the heavy indebtedness of the farmers to the traders, commission agents and middleman.Besides the organizational and functional dimensions of the marketing system, the flow of commodities in the NE region is restricted and localized to certain specific areas due to geophysical conditions as well as lack of infrastructural facilities. Consequently, the factors of marketing such as pricing, backward and forward linkages, demand and supply of commodities are greatly affected to the disadvantage of both the producers and the consumers. The basic infrastructure facilities include storage and warehousing, road links, transportation and communication aids.Of these, storage and transportation network performs a significant role in stocking and mobilization of goods. The storage facilities in the region are located mainly at district headquarters and state capitals. Marketing of agricultural commodities in the northeastern states, by and large, is dominated by the private traders due to the absence of proper implementation of market regulation act by the state agricultural marketing boards The state wise problems emerging in the management of rural markets and various functions thereof is detailed in the following text. AssamThe farm produces in the state pass through a number of channels before reaching the consumer. The farmer gets only a small producer’s share in the consumer’s rupee. Middlemen at different stages of marketing process have emerged as a powerful channel for the procurement of food grains taking the advantage of the farmer’s poor economic condition and weak bargaining power. Thus, the farmer needs protection from such exploitation and also assistance in many respects, more so in a state like Assam where the agriculturists are subject to natural calamities and various other constraints.The village moneylenders advance loans to the cultivators at the time of need making it obligatory on the part of the farmer to deliver their produces after harvest at a price offered by the moneylender. The farmers lose market price significantly due to lack of proper sale arrangements in markets. In addition, farmers do not undertake proper cleaning and grading of the produce before sales, which is also one of the reasons for low price. There are many infrastructure problems faced by the farmers in the rural markets.Of many, the rural storage facility is found to be very weak. The farmers are not able to store the cereals, horticultural crops like potatoes, spices, fruits and vegetables for striking a better price deal in the rural markets. The transport is a major bottleneck in the region and due to poor accessibility a large number of farmers carry their produce on head loads. The inadequacy of infrastructure and lack of awareness of the market information has been found as one of the prominent reasons for the distress sales in the village markets or to the itinerant traders.The market information is not effectively disseminated by any of the organization in the and farmers are not largely benefited thereof. The processing of food crops, oilseeds, fruits and vegetables is inadequate in the state. The private sector is also not enterprising in setting-up the processing units in the state for harnessing the surplus fruits and vegetables and oilseeds like mustard. Meghalaya Paddy is the main food-crop grown in the state.Maize, wheat, millets and pulses, potato, jute and rnesta, cotton, mustard, ginger, turmeric, areca nut and betel leaf are some of the important cash crops produced in the state. Among the horticultural crops, banana, pineapple, citrus fruits mainly oranges are grown in abundance. There are a number of constraints such as transport, communication, suitable organized marketing set-up, weak cooperative organization, and deteriorating conditions of the primary markets in the rural areas of the state.The private traders have, by and large, monopolized the trade and commerce in the state. Marketing of surplus agricultural produce and other minor forests produce, supply of essential foodstuffs, agricultural inputs etc. are mostly handled by the private traders. The local autonomous administrative bodies are the controlling authorities over these markets including collection of tools and levies without having any control on the Rural Marketing System in the Northeastern States 166 ASCI Consultancy price or quality of the produce sold in the market.The primary markets in the rural areas do not have required facilities of a regular and economic transport. Besides, the market stalls are not properly laid down and are mostly temporary structures made of thatches and bamboo. Basic amenities like godowns or storage facilities, drainage and pavement, parking facilities, supply of drinking water are generally not available in these markets. The farm produce are generally sold without any grading. The traders and the middlemen used to take advantage of the situation by paying lower price for even good quality of produce.As such, the farmers need to be trained for grading of the produce and maintain quality to fetch a better price. The problerns of marketing of the surplus fruit produce of the border areas of the state needs to be tied up with the fruit processing units under the Department of Agriculture, Meghalaya Cooperative Federation (MECOFED) and other marketing organizations in the State as well as outside the State for the benefit of the growers by utilizing the border tracks as transport links.The fruits and vegetables growers of the state face a number of problems particularly in the rural areas for the disposal of their surplus produce and are deprived of a reasonable price. As such, it is felt that marketing of these commodities may be organized through cooperative organizations/growers organizations etc. for sale in the urban areas by giving transport subsidy. The market regulation in the state is not enforced in many urban and rural markets due to the administrative problems. The markets have not been transferred to the local bodies for the management and control.Tirpura In the local context of Tripura, the interaction of the producer – Seller, particularly the small and marginal farmers, is inexplicably linked to the efficient working of rural markets and periodic hats. The rural farmers look up to these markets not only for disposing off their Small Surpluses but also for several other Services including the Supply of their day to day requirements. From the point of helping the disadvantaged group of small farmers a well planned and executed programme of development of rural market and Haats, thus, become more relevant for the state.Rural Marketing System in the Northeastern States 167 ASCI Consultancy The increased production on the small farms in Tripura witnessed during recent years demand the development of rural markets. A marginal or small farmer having a little marketable surplus does not find it economically feasible to carry his produce to a distant wholesale assembling market although there are chances of his getting a better price there. The prices prevailing in the rural markets of Tripura are invariably much lower.Price variations are attributed to many reasons such as lack of Storage, transport and marketing facilities at the base market level. Due to lack of transport facilities the farmer is unable to bring his produce to the market. In the absence of the storage & warehousing facilities, the farmer is forced to sell all his produce at harvest time at low prices, only to buy back in off-season at high prices. This highlights the need for Survey and planning of rural markets to enable them to play their role effectively.They can be provided with adequate facilities including warehousing, Storage, etc. , at market place especially in the interior tribal belt where the farmer is much deprived of the remunerative price. Inadequate infrastructure facilities like roads, market yards, etc. , discourage the traders’ interest in purchasing the agricultural produce and non-farm commodities in these markets. For the same reasons, the procurement agencies of the Government are also unable to make effective purchases. For lack of competition the prices tend to fail or linger at low level.The rural markets should come up to a level, where their prices formation process would promote the off flow of Surplus to and in-flow of Scarce produce from district level. Selling at farm or village level relieves the farmer of botherations of arranging transport, storing, taking it to market to find buyers, etc. The difficulties aggravates when a farmer has a Small marketable surplus to offer. Many a times the farmer is forced to sell owing to financial linkages with the visiting trader.Sound identification of deficiencies vis-a-vis requirements followed by cost-benefit calculations is necessary. Rural markets are often held in Jute lands and Khas lands convenient lanes, open space, Shadows of trees etc. With the increase in number of users and the volume traded as well as with change in the trend of handling and trading practices, space, layouts and facilities become important for the Smooth and efficient functioning of a market and deficiencies in these areas are considered a main foot for bad performance.The transport bottleneck is prevalent in the state and is being tackled by the local Panchayats by constructing link roads. As per the existing systems markets are developed by the Department of Agriculture, State Government and the same are handed over to the Statutory Market Committees for management and control. Central assistance is also availed of from Directorate of Marketing and Inspection and Department of Rural Development, Government of India both for Regulated and Rural Markets.Recommendations The following recommendations have emerged after the study of the rural marketing system in the selected states. Agriculture Production and Yield ?? The agriculture in the northeastern states is the main stay of the economy and is yet to be geared-up commercially. The higher production of cereals, pulses, oilseeds, cash crops and horticulture produce in the region would subsequently lead to higher marketable surplus, larger scope for processing activities and input marketing.There is a need to enhance the agricultural production base, as existing yield levels are no where near the national averages. Management of Rural Markets ?? The northeastern states like Assam, Meghalaya and Tripura have the legislation for the marketing of agricultural produce but there exist many problems in enforcing the Act in various markets in the states through the regulated market committees. Consequently a large number of rural markets are unorganized and should be brought into regulation in a phased manner. ??The management of rural and apex markets should be handed over to the local bodies elected democratically including cooperatives. Professionally qualified managerial talent should replace the officers on deputation to facilitate long term planning and development of marketing institutions. Logistics and Infrastructure ?? Storage and grading is an important function in the agribusiness and needs to be strengthened in the region. Since the concepts of grading and scientific grading are unheard at the farm level, the apex marketing boards hould organize onfarm as well as classroom based training for both farmers and village traders. Focus should be given on retaining traditional bamboo based mat age but at the same time sensitize the farmers to other alternatives like Polypropylene , High Density Polyethylene based materials for storage as well as handling of agricultural produce. ?? Most of the existing storage capacity is concentrated in major towns with institutions like State Warehousing Corporations, Marketing Boards and Apex Cooperative Federations which is neither accessible to the farmers nor affordable to them.The efforts should be made on creating rural storage capacity with primary agricultural credit societies and panchayats. ?? Transportation of agricultural and other rural products has become both expensive and inadequate despite the fact that speed of movement is so vital for Rural Marketing System in the Northeastern States 170 ASCI Consultancy realizing good returns on the perishable horticultural produce. The team does not support the idea of apex marketing boards operating their own fleet of vehicles as the system leads to several managerial problems as noticed in other states.While they may continue to operate refrigerated vans purchased under central schemes of Government of India (GOI), private transporters should be encouraged with adequate credit support though the financial institutions to purchase the light commercial vehicles and operate. To check exploitation of farmers the transport tariff may be fixed from time to time by the respective state governments as is done for passenger transport in major towns and cities. Business Linkages ??There is a need for strong horizontal linkages among the unorganized rural markets, regulated markets of apex marketing boards and primary level cooperatives on one hand and the vertical linkages across the national institutions of the GOI, state level marketing organizations and primary level institutions. These linkages should facilitate the flow of market-related information and skills as also resources information on physical infrastructure such as transportation, storage, packaging and other facilities for planning and implementations of government schemes. ? The northeastern region has historically enjoyed good trade relations with the erstwhile East Bengal that continues even today across the Bangladesh border. As agribusiness has fast taken shape in the country, the northeastern states should create export wings in their apex marketing boards, corporations and related marketing organizations to drive home the market advantage that already exists.