Agriculture marketing is important in economic development of

Agriculture plays
crucial role in the Indian economy as the economic development of country is
dependent upon the agricultural activities. Agriculture not only serves as a
source of food for the nation but also provides opportunities for employment
generation, contribution to industrial goods market, saving and earning foreign
exchange. More than 58 percent of rural household in India depends solely on
agriculture for their livelihood. In India , agriculture and allied sectors
(including agriculture , livestock , forestry and fishery) contributes 16 per
cent in GDP. Agricultural marketing is the study of series of  activities in the procurement of farm inputs
by the farmers and the movement of agricultural products from the farms to the

The movement of
agricultural produce from farmers to the consumers at the lowest possible cost,
consistent with the provision of services desired by the consumers can be
termed as efficient agricultural marketing. Agricultural marketing is a link
between farm and non-farm sectors. All entities associated in agricultural
marketing are interested in having an efficient marketing system. An efficient
marketing system for agricultural produces ensures an increase in the farm
production gets transformed into an increase in the level of income thereby
increasing the additional income. An efficient agricultural marketing system is
an effective agent of change and an important means of raising the income
levels of farmers and satisfaction of the consumers. Consumers get the
satisfaction when they get the goods at the least possible cost. An ideal
marketing system aims at giving remunerative prices of produce to farmers,
uninterrupted supply of goods to the consumers at reasonable prices. Efficient
agricultural marketing is important in economic development of India.

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Keyword- Agriculture,
Agricultural Marketing, Agricultural Development



There has been
considerable research in the area of agriculture marketing in past few years.
These papers mostly deal with challenges, prospects and government initiative
towards agricultural marketing.

The research on Raising
Agricultural Productivity and Making Farming Remunerative for farmers (2015) do
by National Institutions for Transforming India (NITI) Aayog, Government of
India focuses on five key issues such as measures necessary to raise
productivity, reforms necessary in the areas of land leasing, policies ensuring
remunerative prices for farmers , polices ensuring remunerative price for
farmers, mechanism to bring relief to farmers hit by natural disasters and
initiatives necessary to spread Green Revolution to eastern states.

Rajendran and
Karthikesan (2014) in their study pointed out that small scale farmers need to
informed with market knowledge like fluctuations , demand and supply concepts
which are the core of economy.

Rehman,, (2012)
stated that the supply chain in agricultural marketing is long and has
increased the margin between the price received by the farmer and the price
paid by the consumer. Tightening of the supply chain is called for and the role
of the farmer’s organizations, Cooperatives/Self Help Groups needs to be

(2012) recommends that farmers should develop effective mechanisms for
collaboration and linkages, invest in market intelligence. This will enable
them to enhance their bargaining power on prices. Farmers should expand farm
sizes and also access mobile phones since such assets significantly influence
market channel access. Farmers are encouraged to join cooperatives to enhance
their chances of accessing critical production inputs and the government should
provide extension services to improve production.

(2011) pointed out  the agribusiness
sector has witnessed the entry of a number of corporate houses, which has
fuelled a debate on their effectiveness in meeting the credit and technology
crunch of the economy on one hand and potential exploitation of farmers on the

Mishra J .P (2010) in
his study found  that farmers are not
receiving benefits as per provision made by regulated market act in favour of
farmers just because of disputes between government and traders.

Vikram Sorathia , Zakir
Laliwala & Sanjay Chaudhary (2005) suggested in their research paper a
model act which is for implementation in all Agricultural Produce Marketing
Committees (APMC) throughout India. They emphasized on web services based
business process management system, developed to facilitate marketing of
agricultural produce .


1, To identify the
major challenges of agricultural marketing.

2. To highlight the
role of government for improving agricultural marketing.

3. To provide
suggestions for the improvement of agricultural marketing


Small agricultural holding- The size of
agricultural holding in quite small , scattered 
and uneconomic. Therefore the cost of producing and transporting
agricultural produces increase thereby reducing marketing margins.


Lack of storage and warehousing
facilities- Due to lack of storage and warehousing facilities farmers have to
forcibly sell out their produce as soon as it is ready. It results in getting
low price for their agricultural produce. Most of the existing warehousing and
storage facilities are not up to the mark which also affects the quality of
agricultural produce.


Lack of transport facilities- The roads
from villages to cities or mandis are not capable to transport agricultural
produce. Due to lack of proper roads and transport facilities farmers are unable
to take their produce to mandis  and are
unable to receive a fair price for their produce.


Large number of middlemen-The main
defect of Indian agricultural marketing is the presence of too many middlemen.
Middlemen on the one hand exploits farmer by purchasing the produce at low
price and on the other hand exploits customer by demanding high prices leading
to malpractices like black marketing and hoarding.


Lack of Uniformity in Grading and
Standardization- Lack of proper grading facilities and standardized measures for
categorization of agricultural produce at the farmer’s level result in weak
bargaining power and low price for their produce.


Lack of market information – Farmers
have no knowledge about markets. Farmers usually have no access to real time
information on current and future prices of their produce. Thus they have to
accept any price offered by middlemen.


Lack of Financial Resources- Lack of cheap
credit facilities and high dependence on informal credit channels has affected
the expansion and modernization of agricultural productivity. Due to lack of
awareness, farmers are forced to borrow money from informal sources of finance
at very high rate. Sometimes they sell their produce at cheaper rates at
earliest to repay the amount to avoid high interest rate from moneylender.



Lack of Farmer’s Organisation-  Farmers in India are in unorganized and there
is no any authorized body to guide and protect their interest. On the other
hand , traders are in organized form and powerful to bargain over prices .
Under such cases , farmers will be generally exploited and do not get
competitive price for their produce.



National Agriculture Marketing – has the
main objective of facilitating farmers to access markets across the country. It
is a mechanism to develop a national network of physical mandis which can be
accessed online. It seeks to leverage the physical infrastructure of mandis
through an online trading portals , enabling buyers even outside the state to
participate in buying agricultural produce.


Agriculture Produce Marketing
Committee-The purpose is to create a single agri-market where with single
licence one can trade agri-produce as well as livestock. The Agricultural
Produce and Livestock Marketing (Promotion and Facilitation) Act, 2017, which
provides for progressive agricultural marketing reforms, including setting up
markets in private sector, direct marketing, farmer-consumer markets,
de-regulation of fruits and vegetables, e-trading, single point levy of market
fee, issue of unified single trading license in the State, declaring
warehouses/silos/cold storage as market sub-yards and Market Yards of National
Importance (MNI) so that more markets are available for farmers to sell their
produce for better prices.


3.     Minimum Support Price – is a form of
market intervention by the Government of India to insure agricultural producers
against any sharp fall in farm prices. The minimum support prices are announced
by the Government of India at the beginning of the sowing season for certain
crops on the basis of the recommendations of the Commission for Agricultural
Costs and Prices (CACP). MSP is price fixed by Government of India to protect
the producer – farmers – against excessive fall in price during bumper
production years. The minimum support prices are a guarantee price for their
produce from the Government. The major objectives are to support the farmers
from distress sales and to procure food grains for public distribution. In case
the market price for the commodity falls below the announced minimum price due
to bumper production and glut in the market, govt. agencies purchase the entire
quantity offered by the farmers at the announced minimum price.

Minimum support prices are currently
announced for 24 commodities including seven cereals (paddy, wheat, barley,
jowar, bajra, maize and ragi); five pulses (gram, arhar/tur, moong, urad and
lentil); eight oilseeds (groundnut, rapeseed/mustard, toria, soyabean,
sunflower seed, sesamum, safflower seed and nigerseed); copra, raw cotton, raw
jute and virginia flu cured (VFC) tobacco.


4.     AGRI UDAAN- AGRI UDAAN”- Food and Agribusiness Accelerator 2.0. This
programme will help to selected innovative startups who will be mentored in to
scale up their operations in agri value chain for effective improvement in
agriculture. This is a 6 month program in which shortlisted agri startups
with promising innovative business models will be mentored & guided to
scale up their operations.


5.     Scheme for Agro-Marine Processing and
Development of Agro-Processing Clusters  – The objective of SAMPADA is to
supplement agriculture, modernize processing and decrease agri-waste.

 SAMPADA is an umbrella scheme
incorporating ongoing schemes of the Ministry like Mega Food Parks, Integrated
Cold Chain and Value Addition Infrastructure, Food Safety and Quality Assurance
Infrastructure, etc. and also new schemes like Infrastructure for
Agro-processing Clusters, Creation of Backward and Forward Linkages, Creation /
Expansion of Food Processing & Preservation Capacities.

6.     The NITI Aayog has proposed various
reforms in India’s agriculture sector, including liberal contract farming,
direct purchase from farmers by private players, direct sale by farmers to
consumers, and single trader license, among other measures, in order to double
rural income in the next five years. The Ministry of Agriculture, Government of
India, has been conducting various consultations and seeking suggestions from
numerous stakeholders in the agriculture sector, in order to devise a strategy
to double the income of farmers by 2022.




Government of India have recently taken several measures to uplift the status
of agricultural sector. But still there is lot to be done in the field of
agricultural marketing. Here are few suggestion for the improvement in
agricultural marketing. These are

of Middlemen- The elimination of middlemen is necessary from agricultural
marketing, because unless the farmer is allowed the facility of direct sales to
the customer, he cannot receive a fair price for it. Thus, with the elimination
of middlemen, ‘consumer grain centers’ should be established where the farmer
can sell their produce directly.

Loan Facilities – The banks are providing easy loan facilities to the
farmers but it is insufficient for completing their requirement. Small farmers
are still facing problem for getting loans and repaying their loan back to the
bank. If, the government establishes banks, cooperative societies or other
financial organisations then this problem can be solved.

Development of means of
Transport- The backbone of agricultural marketing is robust means of transport
.Thus ,roads should be constructed and maintained   in
rural areas which remain capable of transportation during all seasons.

Storage and warehousing
facilities-The government should extend and construct additional storage and
warehousing facilities in  rural areas.
Government should also provide loan facilities for farmers seeking storage and
warehousing facilities.

Training Facilities- For the
improvement of agricultural marketing system , it is necessary that arrangement
are made for the appropriate training of the employees related to marketing
administration. Training with regard to the system of regulated market etc  is extremely important for the improvement of
agricultural marketing.

Market Survey- To make the
agricultural marketing system effective it is required to conduct market
research . This involves collection of huge data relating to production ,
consumption , import , export , demand rice level , standardization ,distribution
system etc. such data should be published from time to time.




The agricultural marketing system
stands today at a critical stage of its evolution.  Efficient agricultural
marketing can ensure better income for the farmers and improved satisfaction to
the consumers. India is expected to achieve the ambitious goal of doubling farm
income by 2022. The agriculture sector in India is expected to generate great
momentum in the next few years due to increased investments in agricultural
infrastructure such as irrigation facilities, warehousing and cold storage. 



Acharya, S.S., &Agarwal, N
L,(2006). Agricultural Marketing in India. Oxford & IBH PublishingCo.Pvt.Ltd.
New Delhi.


Rajendran, G &Karthikesan, P
(2014). Agricultural Marketing in India – An Overview, Asia Pacific  Journal of Research 1 (17) 159-164.


Rehman, S., Selvaraj, M. and
Ibrahim, M.S. (2012) “Indian Agricultural Marketing-A Review”,

Asian Journal of Agriculture and
Rural Development, Vol. 2 (1), pp. 69-75.


Rehman, S., Selvaraj, M. and
Ibrahim, M.S. (2012) “Regulated Agricultural Marketing in India-

A Review”, International Journal
of Management and Administrative Sciences. Vol. 1 (7),pp.36-44.


Sengupta, J., Nag, R. N. and
Goswami, B., (2011) “Reforms and terms of trade volatility in an

agriculture dependent economy”,
Journal of Economics and International Finance. Vol. 3 (6), pp.



Sorathia, V., Laliwala, Z.,
&Chaudhary, S. (2005). Towards Agricultural Marketing Reforms: Web Services
Orchestration Approach: Proceedings of the Services Computing, 2005 IEEE
International Conference. 2005. 100


Zivenge, E. and Karavina, C.,
(2012) “Analysis of Factors Influencing Market Channel Access

by Communal Horticulture Farmers
in Chinamora District, Zimbabwe”, Journal of Development

and Agricultural Economics. Vol.
4 (6), pp. 147-150,


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