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Himachal Pradesh MARKET INTERVENTION TO ENSURE REMUNNERATIVE PRICES

Himachal Pradesh MARKET INTERVENTION TO ENSURE REMUNNERATIVE PRICES. National conference on Agriculture for Kharif campaign 26-27 th February, 2014. Introduction.

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Himachal Pradesh MARKET INTERVENTION TO ENSURE REMUNNERATIVE PRICES

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  1. Himachal PradeshMARKET INTERVENTION TO ENSURE REMUNNERATIVE PRICES National conference on Agriculture for Kharif campaign 26-27th February, 2014.

  2. Introduction • Agriculture sector provides direct employment to about 69% of the main working population in the State. Contribution from the Agriculture and allied sectors account for nearly 20% of the total state domestic product. Agriculture sector has experienced spectacular development due to progressive policy of Government and the adoption of improved/scientific production technology by the farmers. There was a great increase in the marketable surplus. Consequently the farmers were not getting remunerative price for their produce. For this purpose market intervention is essential to ensure the remunerative prices.

  3. Today, Himachal Pradesh has emerged as an important fruit & vegetables growing State in the country. The state is providing excellent quality of temperate fruits like apple, pear, stone fruits, nuts, etc. and sub-tropical fruits like mango, litchi, guava, citrus fruits etc. new fruits crops like-kiwi, strawberry, olive, hazelnuts etc. have been introduced in recent years, Besides flowers, vegetables, mushrooms, hops, honey, tea, medicinal and aromatic plants etc. are also being grown in the state. • The Agro climatically the state is divided in to four zone.

  4. Agro climatic zone of the State

  5. In zone, III & IV farmers are growing off season vegetables which are marketed in the within state and adjoining plains of the country. The present status of area, production of vegetables and fruits marketable surplus is as under:

  6. Vegetable production • Vegetable production has increased form 25000 M tonnes during 1951-52 to 5,30,000 tonnes during 1966-67 & 12.68 lac tonnes during 2010-11. It further increased during 2010-11-12 to 13,56,600 MT Major vegetables include Peas, French bean, Cauliflower, Root Crops, Potato, Cucurbits, Onion, Garlic, Capsicum, Tomato, Cauliflower, Cabbage, etc. Area and production of different vegetables in the state is as under:

  7. Crop-wise Vegetable production:

  8. Fruit production . • The agro-climatic conditions of Himachal Pradesh are extremely suitable for growing different varieties of fruits. Apple is the most important amongst all. The peak marketing season for apple is August to September year. During 2001, the apple production was 2, 75,036 MT alone out of total fruit production of 3.72823 MT Apart from this, there is vast potential of growing other temperate fruits. The area under fruits was 792 hac in 1950-51 with total production of 1200 tonnes which has increased drastically to 2.08 Lac hac. With total fruit production of 10.27 lac M tonnes during 2010.

  9. Area and production of fruit crops

  10. The marketable surplus of vegetables

  11. The marketable surplus of fruit crops ( out of state) (in boxes of 20 kg each)

  12. The marketable surplus of other commercial crops .

  13. Marketing season of major crops

  14. Arrivals of fruits and vegetables in apmcs

  15. Present statues of marketing infrastructure • The H.P. State Agriculture Marketing Board has setup 54 market yards at various places in the state it is plan to expand the mostly infrastructure as per the requirement and availability of sources.

  16. APMC’s and market sub yards

  17. Market intervention • In order to ensure remunerative price for the major agricultural produce the market intervention activities divided into three categories. • 1. Farmer level • 2. APMCs level • 3. Govt. level (State/Central sponsored Scheme)

  18. Farmer level • The producer is the main contributor of every situation. His participation is expected to make up a whole intervention. He has to keep all the factors in mind before the production. The following steps may help him. • Focus on day to day market information. • Short/long terms planning of produce as per demand. • Adoption of Scientific Cultivation Technique helps to reduce the cost of production. • Use of post harvest technology . • Focus on grading and value addition packing.

  19. APMCs level • The farmer along with the return some times faces the problem of surplus production and he does not get sufficient pay for work. APMC becomes involved in that situation to improve or control it. . The points which are given may be valuable as further remarks. These factors may make the way easy. I these points are considered seriously we can not only ensure the farmers but can also gain his lost determination and confidence. In future the following plans are designed to achieve a long term aim or purpose. The mutual understanding will pave the way for the farmer. Finally with this collaboration and putting our full capacity in action will provide way and the fruitful results may be found.

  20. Strengthening of marketing infrastructure In production areas through involvement of Agricultural Produce Market Committees, Co-operative, Small farmers groups in clusters and Private Sector will not only help farmers to get income through greater participation in a more efficient rural market & inclusive growth but provide further impact for diversification and bring more employment and prosperity in rural areas of Himachal Pradesh.

  21. The availability of marketing infrastructure i.e. Small markets/collection centres in the production area will also solve the problems of marketing of produce in distant markets and they will save in term of cost of transportation, transit losses and miscellaneous charges. • Setting up more seasonal markets in production area after proper designing planning to handle the arrivals in efficient manner providing minimum facility of auction platform, storage, structure, grading and packing houses, public facilities etc.

  22. Alternative marketing channels: • Direct marketing to consumers/retail chain/buyers i.e. Fair price shops at APMC level. • Farmers Markets ie. Apni Mandi Contract farming Contract farming involves agreement between producer and sponsoring agency (Buyer) for Future Trade .The price of the commodities is also decided by the both party at the time of agreement. Popularization of Grading at producers’ level, value addition through primary processing and packaging

  23. Modernization and expansion of existing yards providing therein grading and packing lines, repining chambers cold/CA stores, adequate auction platform and other facilities. • Empowerment of farmers through market information website, news paper, Doordarshan, Ticker Board,(agmarknet) SMS portal and documentation of success stories. • Integration and strengthening of Marketing network to curb malpractices and reduce paper work through automation of market operations. • Marketing through e-trading • Setting up more agro- based small processing units

  24. Govt. level (State/Central sponsored Scheme) • Government intervenes through Minimum support Price (MSP). The MSP is ensured through procurement by central, state and cooperative agencies in the states. State governments have been alerted from time to time to make adequate arrangements to ensure MSP to farmers.

  25. In addition, Government is implementing Market Intervention Scheme (MIS) for agricultural and horticultural commodities not covered under the Price Support Scheme. The MIS is implemented on the request of State/UT Government in order to protect the growers of these commodities from making distress sale in the event of bumper crop when the prices tend to fall below the cost of production.

  26. Price Support scheme (PSS) and market intervention scheme (MIS), Minimum support price (MSP) • The Price Support Scheme (PSS) and Market Intervention Scheme (MIS) ensures remunerative prices to the growers and in case market prices fall below the MSP/MIS, central/state agencies Start the purchase operation by paying the MSP/MIS to the farmers.

  27. State wise implementation of price sport scheme & Market intervention scheme (PSS AND MIS)

  28. Minimum Support Price (MSP) Wheat and paddy are two major agricultural commodities procured by the National cooperative marketing federation (NAFED), Food corporation of India (FCI) under MSP in order to have sufficient buffer stock from food security point of view and to feed the public distribution system. Procurement through MSP is not done in all the states like in case of wheat it is mostly done form the states of Punjab and Haryana whereas in other states it is almost negligible.

  29. In Punjab and Haryana farmers are able to sell their surplus wheat and paddy at MSP but this is not true in case of farmers of all other stages. The reasons are difference in procurement mechanism by the procurement agencies like procurement through commission agents in some states whereas provision of direct procurement from farmers in other states. In states where there is provision of direct procurement from farmers, no significant procurement actually takes place.

  30. Efficiency of market intervention scheme (MIS) • The MIS in the state of Himachal Pradesh is being implemented through State agencies of HPMC & HIMFED. The fruits like apple, Kinnow, Malta and Santra were taken up under the scheme during the year 1990-91. Later on Galgal was included during the year 1995-96 and for mango MIS was implemented during 1998.

  31. Coverage of districts under mis for different fruits

  32. Period of implementation • The scheme is not open throughout the year and is open only during the harvesting and marketing period of fruits covered under the scheme. The duration of operation of scheme has been presented in the table.

  33. Price announcement of mis • The procurement of fruit under the scheme is strictly at the price announced and notified by the state government beforehand. The procurement cost is being born by the administrative department i.e. Horticulture department.

  34. Cost of fruit procurement under MIS

  35. Details of procurement rate, quantity procured and dispatch of apple under MIS

  36. District wise procurement of apples and value of procured apples under MIS

  37. Issues/problems of mis in the state • Payments are not always in cash, farmers are obliged to accept inputs like fertilizers, packing materials and insecticides etc as kind payment. • During the years of high production, significant amount of procured apples is wasted and destroyed. This is a burden on state exchequer. • The quantum of apple used for processing is low and only apple procured b y HPMC is being used for processing. • Most importantly, this is a loss making preposition for the state and as such has large scope for improvement in management of the scheme.

  38. Suggestions: • The quality of MIS produce needed to be improved so that problem of shortage of buyers is eliminated to some extent. • Arrangements of vehicles at the time to peak season need to be improved so that produce can be handled safely, with low cost and well in time. • There is a need of finalizing the auction place for selling of the produce and date and time of auction well in advance. This information can be passed on to interested traders through advertisement.

  39. Handling charges need to area specific so that the collection of produce especially in those areas where collection centres are away from road head is facilitated. • Opening of new processing units is the immediate need in the state. With opening of these units MIS produce can be disposed off efficiently. If such arrangement are not made urgently the time may come when the scheme may become unviable. • There should be equal distribution of collection centres to both the agencies so that competition between these does not arise.

  40. The positive effects of market intervention • Assured returns • Avoid distress sale • Encourage farming • Ensure Food Security • Better agri-marketing through sorting, grading, packing and levelling • Innovative marketing practices • Selling through APMC market yards, co-operatives, direct marketing or through E-commerce • Ensure disposal of produce • Promote processing

  41. Issue • Monoculture practices • Distort Competition • Excessive use of Natural Resources.

  42. Conclusion • Market intervention is required for major surplus commodities of respective states. Like in case of HP major surplus of fruits and vegetables which are highly perishable. State/central Govt. agencies can procure surplus fruits and vegetables for processing by the PSUs and processed products can be sold through Fair Price shops, PDS etc. Market intervention for perishable, semi-perishable commodities like potato, Cauliflower, tomato, ginger, garlic, paddy, wheat, pulses etc should also be in place to prevent distress sale by the farmers.

  43. Boon for farmer when excessive production. • Focus on diversification and market orientation • Intrusion of private players • More focus on perishables & semi-perishables

  44. Thanks

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