“| MEANING The term, agricuttur, hi ers and ranchers. toehe | ing. buying, selling ‘saites v. general, marketing’ Which direct the goods n°, In agricultural marketing ae source of market suppiy" _up to the point of fina) Y and output Keting. Time ct imparts zs me uti ii tted to Pepa las When commodities 9% Which i channel through buyi through various each level of the e point of view plays a crucial Of farmers, cons tole. Producer's shave > ased on the development of marke! * Breater would be the welfare to the prod: i st market information and marketing faciliti and space. Consumers get maximum welfare t er’s needs and desires are Satisfied, if the supply of the to the consumer with normal Prices without much price ly when the markets are efficient in Supplying the needed sumers. For majority of the middlemen marketing is a source development of marketing system, more would be the and middlemen, a in the consumer ting system in their marketing services. Hence, an efficient market towards bringing the welfare to all ea i e an important and integ) at marketing has becom486 of economic activity and depends mostly on the magnitude of modern production technology: Hence, market policy as an integral part of agricultural development policy should be revised from time to time, keeping in view of the needs of the economy, which are desired by the producers, consumers and middlemen. DEFINITIONS Market: Market is a place where goods and services are exchanged. Market consists of buyers and sellers with facilities to communicate with each other for transactions of goods and services. Marketing: Marketing is the economic process by which goods and services are exchanged between the producers and the consumers and their values determined in terms of money prices. The term agricultural marketing is to be understood from the two words, viz. agriculture and marketing. Agriculture in its broadest sense comprises of all the farm activities, which use the natural resources for human welfare. Generally, it means growing or raising of crops and livestock products with the given level of resources and technology. Marketing comprises of all the economic activities in- volved in facilitating the flow of goods and services from production centre to consumption centre. According to Thomsen, “agricultural marketing comprises all the operations, and the agencies conducting them involved in the movement of farm produced foods, raw materials and their derivatives, such as textiles, from the farms to the final consumer and effects of such operations on farmers, middlemen and consumers.” ‘According to Acharya and Agarwal, agricultural marketing is “the study of all ac- tivities, agencies and policies involved in the procurement of farm inputs by the farmers and the movement of agricultural products from the farmers to the consumers.” Thus, market- ing provides a link between farm and non-farm sectors. Various aspects of organiza~ tions supplying raw materials to the processing industries, analyzing, assessing and revamping the marketing policies for farm products and farm inputs are studied under agricultural marketing. National Commission on Agriculture (NCA) in its XIII report observed that ag- ricultural marketing involves all aspects of agricultural market structure and sys- tem, ie, both functional and institutional aspects based on technical and economic considerations and include post-harvest operations, assembling, storage, transporta- tion, distribution, etc. ‘According to Richard Kohls agricultural marketing is “the performance of all busi- ness activities involved in the flow of goods and services from the point of initial agricul- tural production until they are in the hands of the ultimate consumer.” aa SIGNIFICANCE OF AGRICULTURAL MARKETING With the advent of new farm technologies in the form of green revolution, white revolution, blue revolution, yellow revolution, etc., we have achik elf-su y in agriculture and allied sectors. Now the economy is involved in to siphon off excess supplies of commodities to the needy foreign. now are producing products for international marketing. Input 1 ing at a rapid rate. The consumption of fertilizers and p ic There is a growing importance for improved seeds, nance, etc. The modern agricultural production is contin technology for tapping the input potential over time modern agriculture are increasing the scope of agrict point of view of product marketing and input2 487 olicy areas is laid on th problems through relevant slems Be tianala dein att Marketing feitues ms tne find siya canals 10 Producers SAPPY for Ta ties Prices are ‘eaeneas pee Hon la mot t e e, hee the availabilty Of goods, and serviea at Products to be produced and in what ‘ Nerensee i Petvices, If ihe marke ee Peed production, the demargeul piathe marketing activity te thereby ensures poeta eel ithe increase in and for inputs ‘tion of goods also increases, ye P" farm sector, the omand for th ses i.¢., the demand for “ik the input marketing has te ac oat aerioute Wate ckig ing has to be streny requir athened. ible from the resources they emplo 'y employ. Thus a healthy marketing system acts as an incentive for the farmers to use the resources prudently. Thus efficient input marketing and output marketing systems are indispensable to bring desired level of welfare to the farmers. Farmer infact may turn out to be a major beneficiary if the market system properly functions. Consumers’ Interest Marketing is a system that facili ree! : ilitates the movement of farm iti f mmodit production: centres to consumption centres. Thus it provides oe eee cose farm commodities of their choice to satisfy their needs. Consumers’ wel- following efficient fare is brought about through increased marketi methods of marketing. ee Society's Interest It is an extension of individual consumer's interest When the consumption re- quirements are met by an effective marketing system, society at large gets benefit in this process. It enhances the standard of living of . Society’s resources are distributed efficiently among population in the desired direction. That is to say people's welfare is directly influenced by the efficient marketing system. Marketing is a source of livelihood to several people. An efficient marketing system also brings in price stabilization. i the Gov- hose functionaries apart from noses from producers They Ty ‘ocess of marketing rough the pr k aa eae ‘put also in the Traders’ Interest Y es or middlemen, are tl Market intermediari ee ernment who facilitate the movement O° BESS Seenission agenls OI, retailers, ¢ a nenducers aGovernment Role Government as a custodian of people’s welfare has to perform certain functions. These include the procurement of foodgrains for the maintenance of buffer stocks oe well as to meet the public distribution system through purchases by FCI. Govern. ment activities are also evident from the marketing, assistance rendered by Cotton Corporation of India, Jute Corporation of India, commodity boards, etc. Govern- ment regulates marketing activities through various legislations and marketing policies, Regulated markets are created to check the malpractices of middlemen and bring about efficiency in various marketing operations. Government facilitates any marketing function to be performed efficiently keeping in view of the welfare of Producers, consumers and stabilization of prices. CHARACTERISTICS OF AGRICULTURAL COMMODITIES Agricultural commodities have special characteristics that are different from in- dustrial goods and due to these special characteristics the subject of agricultural marketing is treated in isolation. These special characteristics of agricultural corn- modities bring changes in the supply and demand pattern. Let us now know how these characteristics are affecting the agricultural marketing, operations. 1) Seasonality of Agricultural Production Agricultural year is divided into two to three seasons depending on the agro- climatic conditions. In areas with scanty rainfall, agricultural production is confined to Kharif season only. In areas of adequate and well distributed rainfall farmers are raising crops in three seasons viz, Kharif, rabi and summer season. Thus, over the length and breadth of the country agricultural production is subjected to change based on rainfall distribution and availability of irrigation facilities. This means we have production risk. This finally leads to marketing risk. It means in the years of good production, prices are falling and in the years of low production, prices are increasing. This trend results in wide fluctuations in the prices of agricultural com- modities. On the contrary, the supply of manufactured products is continuous and regular and their product prices are remaining nearly at the same level in a given period with less price risk. 2) Perishability of the Product Most of the agricultural products are perishable in nature. The degree of perish: ability is very high for fruits and vegetables. This calls for immediate marketing soon after harvest. If marketing does not take place for perishable products, it immediately ruins the farmers’ economy. The prices and arrivals of perishable prod- ucts are subjected to fluctuations. If the arrivals of perishable products to the mar kets were less, prices would be very high and vice versa. As a result, consumers and producers are the sufferers. Marketing facilities should be strengthened particularly Processing and storage, to overcome the problems emanating from perishable char- es ob age Products. This characteristic is almost absent for industrial product afa) Gui Quality of tne have }, Products fize colour, 78% Yan FM the bagi. sess standa: hae % stan ericaion encePects of agricultural products such gErioultural pects ding. But this is not a sie red go 3 PPly of 4, preci 1a eensOality faeculturat ¢ an of agri cra Barger rs neo Vetiatogs 8 progres Prices OF the couPPl¥, With demenyPlY is sub S smooth and wcities causa Femaininy mifore® “Sing marketiey ject to fluctuations over 8 the same, bring about risk. But the supply of venty per cent small holdin, of the holdings it is difficult sy we octttered and fran : if t, to estimate “st r marketing even puePly, 4S a result bees Under su Pment becomes dite ich market p ic ult. ch circumstances olicy formulation s criterion we have a) general markets b) specialized markets. - In general markets all types of commodities are sold. These example range from foodgrains to textile goods and so on. s: Specialized market deals with a specific commodity. The d after such commodities. For example, if vegetables are a such markets as vegetable markets. Similarly, markets e wool, cotton, jute and fish are called wool market, cotto and fish market respectively.490 2) On the Basis of Market Area aes the markets into Here, we classify the markets based on the area covered Pops and inter. Various categories viz, local markets, regional markets, National markets. ty markets ts into village terminal mar- rvices take place ‘be regular or ilseeds, chillies ‘in these markets. illage markets. We find many these markets491 4. Terminal inal Markets: These are located in big cities/State capitals/ seaports. These modtel/ organized markets and controlled by the Government to see that all Uvitg amethods of marketing operations take place. Processing and storage 2. genes wre Predominant in these markets. Consumers, wholesalers and marseling rearkeint fen in these markets with rigorous transaction activities Puture in Dig eg forard marketing takes place in these markets, ‘These are situated Seat cities like Chennai, Bangalore, Mumbai, ete mroditned Markets: These are primarily meant for export and import of com sre acs: Scientifically standardized and graded commodities are transacted. These ted_in Mumbai, Chennai, Kolkata, Visakhapatnam, etc. 4) On the Basis of Time Based on ti ‘sed on time markets are generally classified into three categories viz., short ee long period markets; and secular markets. ’eriod Markets: These are held for a brief period in a day. Here the supply een is fixed. Fish market in a particular place i., village or town or iY; Nepetables markets, flower markets, etc, are to be cited here. Since supply is fixed here, we can notice price variation based on demand in a day in the transaction of these commodities. Here the supply is zero elastic. ‘ong Period Markets: Durable commodities, which can be stored for some time, are transacted in these markets. The prices for the products are governed by supply and demand. The examples are foodgrains, oil seeds, efc. Secular Markets: These are permanent markets. Manufactured goods, machinery, efc,, are transacted in these markets. Godown facilities and processing, facilities are highly developed in these markets. These are well-organized markets. They deal with the export and import transactions. 5) On the Basis of Volume of Business According to this criterion markets are classified into two types viz.. wholesale markets and retail markets. b. 6) of transaction. such markets are Wholesale Markets: When large quantities of a commodity are brought and sold in the market among the traders, such markets are called wholesale markets. Retail Markets: These are the markets in which retailers sell commodities to the consumers in very small quantities as per their requirements. Producers, retailers and consumers are seen in these markets. On the Basis of Nature of Transaction Markets are classified into cash markets and forward markets based on the type If there are cash transactions in buying and selling of the goods, called cash markets or spot markets. re the markets in which future sales and purchase of Cash Markets: : These a ¥ b, Forward Markers aa at the current time. This process is called hedging. 7) On the Basis of On markets and D. commodities take £ Competition A ; £ competition, the markets are categorized into perfectly competitive of ci Y the basis fapet fectly competitive markets (f ‘or details see Chapter 7 in Section8) On the Basis of Government Intervention and Regulation Based on the regulation by the Government, markets are classified into two catego- » regulated markets and unregulated markets. a. Regulated Markets: The statutory market committees govern regulated markets and the Government from time to time makes marketing acts, The marketing costs, margins, fee, etc, are standardized. Marketing practices are regulated and facilities created for the smooth conduct of marketing. Prices prevailing in differ- ent markets are displayed through various mass media s conducted without any Unregulated Markets: In unregulated markets, busin supervision. There is absence of rules and regulations, The middlemen exploit the farmers and the consumers to the maximum extent, Sometimes producers are put to loss as middlemen exploit them in weighment, measurement, payment, etc = 9) On the Basis of Nature of Commodity Based on the nature of commodity, markets are classified into commodity markets and capital markets. @, Commodity Markets: Commodity markets deal with the buying and selling of the commodities. Examples are cotton market, wheat market, chillies market, cattle market, bullion market, etc. b. Capital Markets: Capital markets are those markets in which shares, securities, bonds, etc, are being purchased and sold. Share market and money market are the specific examples. 10) On the Basis of Vision Based on vision, they are classified into black markets and open markets. a. Black Market or Invisible Markets: In these markets the goods are not placed in the shops, but they are kept in the godown of the market. Hence, the name black market. The goods cannot be seen by the naked eye. On demand, the goods are delivered to the buyer on cash transaction. Any good, which is in short of supply and anything which is having high effective demand will be sold in the black market. During wars, drought, floods, catastrophes, etc., there is a rigorous black marketing activity for scarce goods. Black markets are closed markets. b. Open Markets or Visible Markets: These are visible markets and transactions take place between buyers and sellers and the price is determined by demand and supply. PRODUCER’S SURPLUS The marketing activity is in reality looks into the ways and means of moving the surpluses available with the farmers, not exactly the actual production of the com- modities. This is the producer’s surplus. More specifically it is the quantity of pro- duce, which is actually made available to the non-farm population of the country. The producer's surplus can be split up into two categories viz., marketable surplus and marketed surplus. Marketable Surplus This is the actual quantity of a commodity that is available with the farmers after meeting his seed requirements, family requirements, kind payments as wages, and Payments to others to whom he pays for their services,Marketed Surplus Tt i Factors Influencing Marketal le | Marketable surplus is infl 1. Size of Holding: Marketable su = ee ding is ample empiric a Level of Prodi ti enced by the efficient us 38 Fait Cousin ily