ROLE OF LOGISTICS AND DEMAND

FORECASTING IN MINIMIZING FOOD

WASTAGE: A STUDY ON FCI

Presented by
Diwakar Thakur
 ROLE OF LOGISTICS IN FCI

• Logistics plays a crucial role in every industry.

In FCI the role of logistics is very much
significant. Logistics functions which are
broadly used are
• Procurement
• Storage
• Movement
• Distribution
 ROLE OF DEMAND FORECASTING

In FCI demand forecasting plays a prominent role.

Demand is what which is going to decide that

How Much Food Grain Need To Produce?
How Much Should Store In Godowns ?
How Much Should Export?

So there is great need of using any technique of

demand forecasting by FCI so that, they can play all
those things.
 OBJECTIVES OF STUDY
 
To study different logistics activities in Food
Corporation of India (FCI).

To study importance of demand forecasting for

FCI.

To study how effective logistics and demand

forecasting techniques can minimize food wastage.

.
RESEARCH METHODOLOGY
Research Type- Descriptive Research
Data Sources- Primary Data and Secondary Data
Research Approach- Survey Method
Research Instrument- Personal interview and Regression
model
Questionnaire Approach-
Contact Method-Personal
Method Of Collecting The Data – Data Was Collected By
Personal Interactions With The Employees Of JSL.
Data processing
Inferences were drawn and the suggestions were given. And
finally a regression model is prepared and interpretations are
given.
 
 ANALYSIS AND INTERPRETATION OF
REGRESSION MODEL

Using the data it was tried to develop regression model and to

find out Coordination between logistics operations of FCI.

Proposed a forecasting model for estimating future food grain
requirements.
 PROPOSED DEMAND FORECASTING MODEL
Food Demand = α*year + β1* Population Growth + β2* Income + β3* Inflation

D = α*T+ β1*P + β2*M+ β3*F

Regression Statistics
Multiple R 0.9953501
R Square 0.9907218
Adjusted R Square 0.967362
Standard Error 4.4534078
Observations 48
.
The value of Adjusted R Square is 0.967362
which is very good; it shows that 96% variation in food demand can be
explained by Population Growth, Income and Inflation.
 INTERPRETATION OF MODEL RESULT FOR WHEAT

In this model demand is taken as a depended and, population growth,

inflation and income as independent variables whose coefficients are β1,
β2 and β3 respectively. Time (year) is also taken as independent variable
to forecast the demand of food grain in future. The coefficient of time
variable is α.
After running regression model on this data the value of adjusted R
square is found 0.96 which is very significant and shows that almost 96%
variation in independent variable can be explained by dependent variable.
The value of α = 0.0553756, β1= -34.30944, β2= 0.2056307and β3=
-0.001868
This model is explaining every variation in independent variable.
This model can be used for forecasting the food demand for n no. of
years given the value of population growth, inflation and income for
that particular year.
Suppose we want to forecast demand of wheat for the year 2020
and the estimate values of population growth, inflation and income
are 1, 10 and 1500 respectively than we can calculate wheat
demand for year 2020 using this equation.
D = α*T+ β1*P + β2*M+ β3*F
D= 0.055*T - 34.309*P + 0.205*F -0.0018*M
After Putting T=1, M=10 and F=1500, this result we will get
 
forecasted wheat Demand for the year 2020 =76.141
CONCLUSIONS & RECOMMENDATIONS

There has to be a seamless flow from what is sown in the fields to

procurement, processing, storage, logistics and transport and retailing,
say. Farmers have to grow the right food, industry has to be able to
procure directly from farm gates, outdated laws have to be weeded out
and stringent quality standards have to be set.
1. Lack of integration in FCI operations
The correlation between them all operations were found for both the
wheat and rice is low which need to be improved. It shows that there is
no proper channel of integration in FCI operations, all the operations
are carried out well independently but as a whole is scope of
improvement.
2.Procurement
The farmers need to be able to sell his produce to whom he wants to,
when he wants to and where he wants to.
3.Processing
Traditional methods of processing such as sun-drying and fermentation have
worked so far, but as Indians become conscious of better quality and hygiene,
these will no longer work.

4. Storage
More than 30 per cent of the produce from the fields is lost due to poor post
harvesting facilities and poor storage still major percentage of wheat is stored
on open capacity which generally got rotten due to rain. So FCI need to have
proper storage facility and invest in warehouse
 
5.Marketing & retailing
End-to-end solutions to deliver higher incomes to farmers and better prices to
consumers require opening up investment in retail and supply-chain systems.
But for over a decade governments have vacillated over a comprehensive policy
for retail preferring to inject piecemeal reforms by stealth.
 
6. Logistics and transport
The Warehousing Development and Regulation Bill, 2007, was
meant to encourage firms to set up warehousing facilities. But
inability to sort out delays in land acquisition is keeping back
modern warehouses.
 
7.Need for the upgrade of Warehouses
FCI needs to upgrade their warehouses so that the loss that occurs
due to leakage and penetration of water can be avoided.
 Limitations
`
Study was conducted only in the city, Dehradun; therefore the
data cannot be generalized.
Study was also conducted through personal interviews; therefore
it could be possible that the interviewees were biased.
Some interviews were conducted through telephone and email
because of geographical restrictions.
The researcher has less experience of researches.

Limited samples taken for interview.

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