Developing Agricultural Value Chains & Commercialization of Agriculture Marketing in India

1. Developing Agricultural Value Chains & Commercialization of Agriculture Marketing in India Maharashtra Experience RameshShingte Nodal Officer Project Implementation Unit- Agri. Mktg Maharashtra Agricultural Competitiveness Project , PUNE

3. Agriculture in Maharashtra • First State to adopt Dry Land Farming Technology • Pioneer in Horticulture Development through EGS • 2nd largest producer of fruits in India (95 lakhs MT/annum) • Leading producer of grapes, pomegranate and orange • Second highest producer of banana and sugarcane • Highest producer of coarse cereals and cotton

4. Agriculture in Maharashtra (Contd.)

5. Agriculture in Maharashtra (Contd.) 5

6. Maharashtra’s Strengths in Horticulture • Diverse agro-climatic conditions • Strong research support – Four agricultural universities • National Research Centers for: • Grapes - Pune, Citrus - Nagpur, Onion & Garlic – Rajgurunagar (Dist.Pune), and, Pomegranate - Solapur • Strong co-operative network • Proximity to international airport & sea port provide the logistic advantages • Strong crop based farmers organizations • Innovative farmers

7. Status of fruit crops in Maharashtra • Area before 1990 : 2.42 Lakh ha. • New plantations : 13.32 Lakh ha. • Total area : 15.74 Lakh ha. • Number of villages : 39,411 • Productive area : 9.14 lakh ha. • Production : 103.2 lakh MT • Number of growers : 17.51 lakhs • Expenditure : Rs. 1,234 Crores • Gross annual turnover : Rs. 6,300 Crores • Man days generated : 3,300 lakh

8. Export of Fresh Fruits and Vegetables from Maharashtra Maharashtra is leading state in export of fresh fruit & vegetables

9. Farmers Organizations / NGOs • Grape Growers Association • Mango Growers Association • Pomegranate Growers Asso. • Banana Growers Association • Sapota Growers Association • Orange Growers Association • Sweet Orange Growers Association • Kagzi Lime Growers Asso. • Guava Growers Association • Aonla, Fig, Custard-apple Growers Association • Vegetable Growers Association • Flower Growers Association • WIFA (Western India Floriculturist Association) • Medicinal & Aromatic Plants Growers Association • Associations for Organic Spices cultivation • Nursery Owners Association

10. Status of GAP in Maharashtra • GAP integrates the application of new production system such as IPM, ICM & INM for commercial production of agricultural products • Quality certification in agriculture

11. Q 1: What are issues in Agricultural Production?

12. Issues in Agricultural Production Small land holdings Subdivision and fragmentation of land Presence of % of small and marginal farmer Only 35 % of area under irrigation Heavy dependence on rainfall Low farm mechanization Low adoption of technology What is the result? Results Low productivity Low shelf life

13. Q 2: What are issues in Agricultural Marketing?

14. Issues in Agricultural Marketing Too many intermediaries Lack of professionalism Unhygienic conditions Inadequate transparency in auctioning Lack of standardization and gradation Lack of facilities - grading, packing, cold storage, processing Market Information & Intelligence Long and fragmented value chain (perishables) Post harvest losses (around 20%) Lack of Pvt. Sector participation Increased Marketing Expenses Low bargaining power of farmers What is the result? Results Distress sale Low share of producer in consumer rupee

15. Q 2: What are issues in Agricultural Processing?

16. Issues in Agricultural Processing Only 2% of perishables processed Lack of private sector participation Weak backward linkages Un-assured forward linkages Absence of contract farming What is the result? Results - No value addition / Very little VA. - Self life not increased / Very low SL.

17. Measures?

18. Measures for Improving Agri. Marketing Providing Transparent Auction System Providing better Infrastructural Facilities Providing Risk Mitigation measures Providing Alternative Marketing Channels Warehouse Receipt Programme Market Information & Intelligence

19. Externally Aided Projects Amendments in Agricultural Marketing Act • Private Markets • Farmer Consumer Market • Direct Marketing • Special Commodity Market • Single License System • APMC Secretary Panel • Planning for Infrastructure Development Maharashtra Agricultural Competitiveness Project (MACP) Convergence of Agricultural Interventions in Maharashtra (CAIM) Agribusiness Infrastructure Development Investment Program (AIDIP)

20. Maharashtra Agricultural Competitiveness Project (MACP) World Bank funded Objective – to increase productivity, profitability and market access and make farmer competitive Agriculture, AHD and Agriculture Marketing – line Depts. Interventions - Extension measures by Agriculture & AHD Strengthening existing markets providing alternative marketing channels by Agri. Marketing Period – 6 yrs Outlay – Rs. 703.00 Crores

21. Convergence of Agricultural Interventions in Maharashtra (CAIM) • International Fund for Agricultural Development (IFAD) aided • Objective: To improve household incomes from diversified farming and from off-farm activities • Coverage: 1200 villages from suicide prone districts (Akola, Amravati, Buldhana, Washim, Yawatmal & Wardha) • Interventions: Institutional Partnership Development & Capacity Building , Sustainable Agriculture & Mktg. Linkages, SHG & CMRC Development , Micro-Enterprises & SMEs • Period : 8 yrs • Outlay: Rs. 593 Crores

22. Objectives - To attract private sector investment for agricultural infrastructure development. Basic agricultural infrastructures as per needs of farmers, traders and entrepreneurs. Farmers capacity building and formation of farmers groups and producer Companies . Crop diversification. Value addition for perishable crop Agribusiness Infrastructure Development Investment Program (AIDIP)

23. Project Components – 1. Establishment of Integrated Value Chain (IVCs) on PPP basis, Hub – Spoke model 2. Strengthening and establishing of IVC backward linkage under JFPR 3. Institutional Development and Program management Financing Plan – (Multi-tranche Financing Facility ) ADB - $ 85 million (32 %), GoM - $ 21 million (8 %) and Private Investors - $ 159 million (60 %) Establishment of Integrated Value Chains (IVCs) – In 1st Tranche – Nashik & Aurangabad – Amrawati IVCs Rest of Maharashtra – 15- 20 IVCs will be established in next 6-7 years. The project is expected to complete by year 2017

24. Amendments in Maharashtra Agricultural Produce Marketing (Dev. & Reg.) Act 1963 • Private markets • Farmer – Consumer markets • Direct Marketing • Special commodity markets • Regional / Divisional APMC • Single license system • Cadre for the secretaries of APMC • Contract Farming.

25. Private Markets • Individuals, Co-op. Societies, companies can establish Private Market • License will be required • Collection & utilization of market fee for the development of market • Facilities like Pre-cooling,Cold storage, Packing centers, Washing centers, Electronic auction, Immediate payment etc. to be provided by private market operators. • Private Market license issued – 23 • Turnover 2012-13 – Rs. 2058.00 Cr.

26. Farmer Consumer Market • Direct selling of Agricultural produce from farmer to consumers. • Farmer & Consumer both will be benefited as middlemen are deleted. • Minimum facilities to be created. • License from Director Marketing is necessary. • Operators can charge necessary service charges.

27. Direct Marketing • License from Director of Marketing, Maharashtra State • License holder can purchase Agricultural produce from farmer at village level. • Market fee to be paid to APMC • Pressure on APMCs will reduce • Income of APMC will increase • Direct Marketing license issued – 78 • Turnover 2012-13 – Rs. 915.11 Cr.

28. Special Commodity Market • Modern facilities for the Sale, Purchase, Store, Grading, Packing of Agricultural produce will be created. • Infrastructure development & can avail the subsidy facilities of State / Central Govt. • Onion, Potato, Orange, Banana etc. Govt. can establish Special Commodity Market. • Special Commodity Markets to be established by State Govt. only.

29. Regional / Divisional APMC • Regional – Arrival of agricultural produce from more than one Tahasil. • Divisional – Arrival of agricultural produce from more than one District. • Govt. can declare the APMC as Regional / Divisional. • Representatives of Farmers, Hamals, Merchants, Traders, Local Authorities, MSAMB, Govt. on APMC Board of Director.

30. Single License System • License holder can purchase agricultural produce from more than one APMC area. • Traders can purchase agricultural produce in a whole state • Time & Money of traders will be saved. • Transparency in License issuing system. • Single License issued - 28

31. APMC Secretary Panel • For the efficient & commercial operations of APMC • Working Secretaries & Highly Qualified Professional / Personals will be included in the Panel. • Recruitment of Secretary from Panel. • Control etc. are the rights of APMC. • Panel to be maintained by the MSAMB.

32. Contract Farming • Contract Farming Sponsor shall apply for registration in FORM “G” to SDAO. • Registration fee is Rupees 500. • SDAO to dispose of application within 60 days. • Prohibition for creation of right, title, interest or ownership in the land under Contract Farming Agreement. • Prohibition for sale of land under contract farming agreement by sponsor. • Total area under Contract farming 1.00 Lakh Ha.

33. Activities carried out by M.S.A.M.B. in Marketing & Risk Management

34. SCIENTIFIC ONION STORAGE INFRASTRUCTURE • Construction cost - Rs. 6000/- per MTs • Subsidy for - 5, 10, 15, 20, 25 & 50 MTs • Subsidy Amount - Rs. 1500/- per MTs or 25% Construction cost whichever less. • Total Capacity Created - 7.00 Lac MTs • Farmer beneficiaries – 28516 • Subsidy given Rs. 72.44 Cr.

35. Agriculture Pledge Loan Scheme • Scheme started: Year 1990-91 • Crops covered: Tur, Mug, Udad, Safflower, Paddy, Soya bean, Chana, Sunflower, Jawar, Bajara, Wheat, Maize, Cashew, Seeds, Raisins, Turmeric etc. • Rate of Interest : 6-8% • Period of 180 days • APMC involved – 60 • Loan disbursed – Rs. 35 Cr. Every year.

36. AEZs in Maharashtra

37. Training & Demonstration Programs (Market Led Extension) • MSAMB with help from State Agriculture Department and Agriculture Universities regularly carry out training programs for farmers in “Quality Production, Post Harvest Handling & Marketing Aspects”. • Total No. of Farmers Trained – 56,000.

38. Export Facility Centers under AEZ

39. Export Facility Centers under AEZ

40. Vapor Heat Treatment PlantLocation : Exporters Building, Vashi, New Mumbai Facilities available : • VHT Machine - Imported from Japan • Pre-cooling • Cold Storage • Grading & Packing Line • APEDA Certified Pack House Facilities Establishment of another VHT machine in the near future.

41. Mango Export to Japan • Market opened in June-2006 • Participated in Mango Promotion Program, Japan • High Value market • Exported around 25 MTs+ mangoes after processing in VHT. • Occurrences of residues in mangoes (Chloro-pyriphos) • Successful Trials for use of Thermo-col boxes

42. Planning for Infrastructure Development • Erection of Irradiation Facility Centre at Vashi, Navi Mumbai is in progress • Promotion of export of Agril. produce to US & Europe. • Planning to develop Quarantine and Phyto-sanitary facilities for promoting export of fresh fruits and vegetables.

43. Quality Consciousness • Guidance to the Growers for GLOBALGAP Certification. - 63 Alphonso mango growers, 76 Kesar Mango grower, 53 Pomegranate growers received the certificate. • Announced 50% subsidy for certification (Mango & Pomegranate) • Undertaking Awareness Programme for the growers to understand the need of changing scenario w.r.t. WTO, Food Safety etc. • MSAMB giving 50% subsidy to farmers.

44. Market Led Extension – N.I.P.H.T.(Horticulture Training Center) • State-of-art Practical Training Centre set up with the help of FMO-The Netherlands & PTC Netherlands • First of its kind in India & 2nd in Asia. • Equipped with : Classrooms, Demonstration Halls, Library, Hostel, Restaurant, Glass/Poly Houses, Meteorological Station • Soil & Water Testing Laboratory. • Fully Computerized Controlled to Low Cost Poly-houses (Total 12) • Total No of Trainees Trained - 17000

45. Market Intelligence • MSAMB has entered into MoU with REUTERS (UK based) for dissemination of Market rates, Weather forecast, Pesticide & Fertilizer application guidance through SMS via mobile phones (REUTERS has enrolled @ 1,00,000+ members) • “MARKNET” - Computerized 291 main markets & 54 sub markets and connected through internet with MSAMB’s portal (www.msamb.com). • Installation of projection TV systems at 69 APMCs in the state for dissemination of arrival, prices and agricultural information. • MSAMB has signed MOU with NOKIA to disseminate Market Rates, Weather, Forecast & Other Agril. information. • Ticker Boards with NCDEX assistance – 106 APMCs • Display Boards – In 140 APMCs

46. Creation of Growers’ Apex Cooperative Societies

47. Fruit Festival Scheme • To reduce the intermediaries. • Availability of commodities to consumers at reasonable price • Better returns to farmers • Assistance of Rs. 1000/- per stall & Rs. 10,000/- for advertisement in Corporation areas. • Assistance of Rs. 700/- per stall & Rs. 5000/- for advertisement in other cities / towns.

48. Other Activities undertaken by MSAMB • Chanalising Agency for Onion Export since 1999. • Nodal Agency for setting up of Terminal Markets (Mumbai, Nashik, Nagpur) • Initiated the process to set up: • Modern Markets at Aurangabad & Basamatnagar on BOT thru’ PPP • Modern Markets at 20 different locations • Computerised Auction System in 100 APMCs •  Provides subsidy for: • Cost of sea freight for export of onion to Europe. • Purchase of Crates by farmers. • Global GAP certification

49. Thanks!