REGULATED MARKETS

The regulated markets are established as per the provisions of the `Marketing of

Agricultural Produce Acts’ of the State Government. The Commodities, with which the

market will deal, are also declared.

Regulated markets aim at the development of marketing structure to ensure remunerative

prices to the producers and to narrow down the price spread between the producer and the

consumer. It also aims at reducing the non-functional margins of the commission agents.

Basic objectives of Regulated Market

To ensure reasonable gain to the farmers by creating environment in markets for

fair play of supply and demand forces,

To regulate market practices and attain transparency in transactions

Aimed at providing proper method of sale, correct weighing, prompt payment and

various marketing related services

Democratic set up to control and manage markets

For controlling the activities of the marketing, there is a `Market Committtee’. The

Committee consists of representatives of the farmers, commission agents and the

Government nominees.

Functions of Market Committee

The complete management of the market rests with the `Market Committee’.

The Committee issues licences to the Commission Agents, weigh men, and other

functionaries.

The rate of Commission to be charged is fixed by the Committee.

Weighment is done properly by the weigh men appointed by the Committee.

1

There is an arbitration Sub-Committee to look into the grievances of the farmers.

Advent of regulated markets has helped in mitigating the market handicaps of producers/

sellers at the wholesale assembling level. With the establishment of regulated markets,

many fraudulent practices of the brokers are observed in the unregulated markets are

overcome and the farmers get reasonable price for their produce. Not only this, amenities

like rest house, place for parking of vehicles, cold-storages, etc. are also created in the

market yards for the benefit of the farmers. In this respect, Government Policy is to have

rapid expansion of the regulated markets in the country.

Agri-Markets in India as on 31.03.2007

Types of MarketsNo. of Markets

Wholesale Markets in India (majority are regulated markets)6261

Rural Primary Markets (about 15% are regulated markets)20870

Total 20870Principal Regulated Markets

2459

Regulated Market Sub-yards 5006

Total 7465

(Only 286 regulated markets in 1950)

2

Regulated markets have achieved only limited success and Rural Periodic Markets in

general, and the tribal markets in particular, remained out of its developmental ambit.

A.P.M.C. – AN INTRODUCTION

Agriculture produce means all produce (whether processed or not) of agriculture,

horticulture, animal husbandry, pisciculture and forests.

The APMCs were established by the State Govt. for regulating the marketing of different

kinds of agriculture and pisciculture produce for the same market area or any part thereof.

The Maharashtra Agricultural Produce Marketing (Regulation) Act was passed in the

year 1963, with a view to regulate the marketing of agricultural and pisciculture produces

in market areas. After giving due consideration to various committees’ recommendations

and study groups, some important changes have been made in this Act in the year 1987

and thereafter.

Mission

1. MAPMC is in the business of facilitating the trade of Agricultural commodities in

the geographical region of Mumbai

2. MAPMC aspires to become the most preferred trading partner of sellers and

buyers of agri-commodities all over India

3. MAPMC promises to provide the most advanced and world-class infrastructure to

all its functionaries

4. MAPMC wishes to be a fair employer, investing in the continuous upgradation

and development of knowledge and skills of its human resources

3

5. MAPMC is aware of its important role in the society and therefore will always

conduct itself with a measure of responsibility towards social causes and with

significant accountability towards environmental preservation

6. As one of the foremost agri-trade organizations in India, MAPMC is fully

cognizant of maintaining and enhancing the image of India and will always

prioritize national interests in its every decision

7. MAPMC is a customer-driven organization and will constantly strive to achieve

complete customer satisfaction and provide prompt customer support.

Division wise break-up of APMC’s are as follows:

No Division Main Market Sub Market

1 Konkan 20 48

2 Nasik 51 106

3 Pune 42 121

4 Aurangabad 33 69

5 Latur 46 86

6 Amravati 55 91

7 Nagpur 43 72

 Total 290 593

Classification of APMC’s (2003-2004)

4

No APMC Class No. of APMC’s Total Income

1 "A" Class 39 Above Rs.1 Crore

2 "B" Class 57 Above Rs. 50 Lac to Rs. 1 Crore

3 "C' Class 72 Above Rs. 25to Rs. 50 Lac

4 "D" Class 122 Less than Rs. 25 Lac

 Total 290

 

History of Regulated Markets

India is an agrarian economy. Approximately 70% of people are dependent on agriculture

for their basic income. Indian agriculture is dependent on rain and Indian economy is

dependent on agriculture. That is main reason why marketing of agriculture products is

dependent on demand and supply conditions. Earlier the farmers were worried about the

sales of their produce and due to low quality they could not fetch a good price.

The produce had many defects and the royal commission in 1928 studied this. There

weren’t enough marketing activities carried on by the farmers. So the royal commission

5

suggested commencing with the regulated markets and accordingly various market

committees were incorporated. The three basic functions of this committee were

1) To meet the demand of the Increase in population and industrial advancement

2) To increase the quality of agriculture produce

3) To fetch an appropriate price for the farmers

The sale of produce in the market yard is carried on by open auction method. During any

deal or transaction an employee from the association is present to note all the details of

the deal like transaction cost, quantity, details of buyers and details of sellers, etc.

For appropriate weighing of farmers produce, the committee has established a different

weighing department. A regular inspection is carried on for this department. The

committee also undertakes grading. In case any default in payment by the buyer the

market committee helps in settling the dispute.

M.A.P.M.C. Vashi

Introduction

Mumbai Agricultural Produce Market Committee (MAPMC) is an autonomous body

constituted under “The Maharashtra Agricultural Produce Marketing (Regulation) Act,

1963” in the year 1977 for the purpose of regulating the marketing of different kinds of

Agricultural Produce. MAPMC was primarily set up to cater to the marketing needs of

the farmers and provide them a platform for selling agricultural produce in various

markets and at competitive prices. Apart from this, it also provides infrastructural

facilities for marketing of agricultural produce including maintenance and management

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of markets. The commodities under regulation of MAPMC are food grains, fruits,

vegetables, spices, dry fruits, pulses, edible oil & oilseeds.

At a Glance:

1 Establishment 15th January Year 1977

2 Shifting To Navi

Mumbai

Year 1990

3 Total Area Of Navi

Mumbai APMC

300 hectares

Trading /Marketing area 72.50 hec

Developed area – 67.88 hec

Area under development – 4.62 hec

Remaining is for other infrastructure facilities

4 No. of declared

wholesale markets

5 markets they are fruit, vegetables, food grains and

pulses, onion and potato market, sugar and spices.

5 No. of galas/shop-cum-godowns

3707

5 Daily transport 4500 trucks

125 onion

100 potato

30 garlic

800 fruits

Others

6 Commodities under

regulation

Onion,Potato,Sugar,Dry Fruits, Spices & Condiments, Oil

Seeds, Edible Oil, Pulses, Food Grains, Fruits, Vegetables,

Sugar Cane,etc.

7

7 Aim Growers (farmers) and consumers should be benefited

appropriately.

8 Timings Vegetable Market :3am-7am

Fruit Market: 8.30 am to 4.30 pm

All other Markets 9.30- till darkness.

9 No. of Auction Halls 4 (Fruit market 2 , Onion market 1, vegetable

market 1)

10 Facilities provided

to farmers

Cash-in-hand in 24 hrs to farmers.

Guest house service at Rs.1/day for farmers.

Other Services (as discussed below)

Daily Arrivals

Market Daily Arrivals (In Quintals)

Onion-Potato 25000

Fruits 11000

Vegetables 16000

Dry-fruits & Spices 27000

Foodgrains & Pulses 40000

Total 119000

Details of shifting of wholesale trade of agriculture commodities from Greater

Mumbai to Vashi, Navi Mumbai:-

Sr. No. Name of the

market

Year of

Shifting

Market

Area in

Hectare

No. of

Galas

No. of

office

blocks

Project

Cost in

Crores

1 Onion and Potato

market

(Dadar market)

1981 7.92 238 - 4.06

2 Spices and

condiments

1991 19.26 660 272 28.32

8

market

3 Food grain

market

1993 16.50 412 356 24.19

4 Fruit &

Vegetable

Market(Crawford

market & Dadar)

1996 17.195 1965 364 117.00

5 Addl.

SCG.Comlex.

- 7.01 228 518 80.00

The adjoining table gives an idea of where the commodities to MAPMC come from:

Rice Haryana and Delhi

Wheat Madhya Pradesh and Delhi

Lady’s finger, Tomatoes, Cabbage, Mint Local markets

Coriander, Methi, Spinach, Radish, Brinjal Bangalore

Drum stick Gujarat

Peas Jabalpur, Indore

9

Apple J&K, HP, New Zealand and Australia

Oranges Nagpur

Pomegranates Solapur, Sangola taluka

Grapes Sangli and Nashik.

Chiku Thane and Dahanu.

Pineapple Kerala and Karnataka

Mango Karnataka, Sindhudurg and Ratnagiri

Lime Solapur district

Green chilly Andhra Pradesh and Karnataka

Onions and potatoes Shirur and Puranda

Bananas Jalgaon, Bhusawal and Nanded

 

Commodity Seasons

Sr. No. Name of

Commodity

Begin End Peak

1. Banana Round the Year

2. Citrus Lime Aug. Dec. Sep., Oct., Nov.

3. Citrus Mosambi Sep., Feb. Dec., Apr. Oct., Nov. Mar.

4. Citrus Orange Feb., Sep. May., Dec. Mar., Apr., Nov.

5. Grapes Mar. May Mar. Apr.

6. Guava Nov. May Dec., Apr.

7. Mango Mar. June Apr. May

8. Pomegranate Nov., Feb. Jan., Apr. Dec., Mar

10

9. Ber Oct. Jan. Nov., Dec.

10. Apple Aug. Nov. Sep., Oct.

11. Papaya Round the Year

12. Sapota Round the Year

13. Brinjal Round the Year

14. Cabbage Dec. Mar. Jan., Feb.

15. Cauliflower Round the Year

16. Onion Oct., Mar. Dec., May Nov., Apr.

17. Potato Feb. May. Mar., Apr.

18. Tomato Round the Year

Functions of APMC Market:

Grant, renew, refuse, suspend or cancel license.

Provide the necessary facilities for the marketing of agricultural produce within

the market.

Regulate and supervise the auctions of notified agricultural produce in accordance

with the rules and the bye-laws.

Regulate the entry of persons and of vehicular traffic into the market.

Supervise the behavior of those who enter the market for transacting business.

Maintain and manage the markets, including admissions to, and conditions for the

use of markets.

Regulate the making, carrying out and enforcement or cancellation of sales,

Weighment, delivery and payment to be made thereof.

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Promote and organize grading and standardization of the agricultural produce.

Take measures for the prevention of purchases and sales below the minimum

support prices as fixed by the government from time to time.

Collect, maintain, disseminate and supply information in respect of production,

sale, storage, processing, prices and movement of notified agricultural produce

including information relating to crops statistics and marketing intelligence.

Carry out publicity about the benefits of regulation, system of transactions,

facilities provided in the market area etc.

Provide for settling of disputes arising out of any kind of transactions connected

with the marketing of agricultural produce.

Receive charges, fees, rates and other sum or money to which the Market

Committee is entitled.

Inspect and verify the books of accounts and other documents maintained by the

licensees.

Provide storage and warehousing facilities in the market area.

 

Advantages of APMC markets:

1) Ethical practices in selling the produce through open agreement.

2) It has removed malpractices in weighing the produce.

3) Use of certified weighs and measures.

4) It has overcome adulteration.

5) Quick settlement of disputes.

Benefits to farmers:

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1) The farmers get fair price (minimum support price) for the produce, as the

intermediaries are not able to indulge in malpractices.

2) Correct weighing of the produce.

3) Storage facilities for agricultural produce.

4) Ethical practices in selling the produce i.e. open auctions and open agreement.

5) Maintenance of daily list of prices of commodities for the benefits of farmers.

6) Immediate payment after disposal of the produce (within 24 hrs )

Market working:-

All the traders work on a commission basis. They have a fixed ceiling on the amount of

commission that they can charge. This varies from commodity to commodity. The

commission is charged on the selling price of the farmers. They are thus called

commission agents. The purchaser pays a levy of 0.8 % on the amount purchased to the

commission agent. This includes a market fee of 0.75% and a 0.05% maintenance fee.

Both the receipts are then forwarded to the market yard office by the commission office.

Quite a few commission agents and traders have now got into the export act and are

mainly supplying to clients in Europe and the Middle East. As India opens itself and sets

itself free from the shackles of licensing, a world of opportunity is opening up for

exporters. MAPMC is fully geared to support these exporters and ensure that Indian

produce gets the recognition and the price that is due. Being located in Mumbai gives the

MAPMC that edge - both the Sahar International airport and the JNPT port are merely an

hour away from the MAPMC market.

PARTICIPANTS OF THE MARKET

Producers / Seller ( farmers) : These are the ones who are not directly involved

in the working but are the part of the whole cycle of agricultural marketing.

Commission Agents :

o Brokers: They are the ones which take minimum risk and as a part of their

income brokerage is paid to them. The commission paid is between 2%-

10%

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o Traders : They are the same as Brokers but level of risk is high

o Adatya’s :

Wholesaler

Retailers

Consumers

Number of Market Functionaries in the Market

Sr. No. Functionaries Numbers

1. Traders – Fruit 1029

2. Traders – Vegetable (Onion, Potato & Garlic) 238

3. Traders – Other Vegetables 936

4. Traders 0 Dry Fruit, Condiments & Spices, Sugar Jaggery,

Coconut, Ghee & Wheat flour

660

5. Traders Food grains, Pulses & Oil Seeds etc. 412

6. Others – Shop Cum Godowns 228

7. Warehouse facilities (Storage Capacity) 5000 MT

Marketwise Rates of Tolai, Commission, Hamali etc.

Sr. No. Name of the

Market

Rate of

Commission(on Rs.

100 sale value

Rate of Hamali Rate of Tolai

1 Onion market Rs. 6.50 Gunny6 bag Rs.

5.17 and sack Rs.

3.10

Rs. 1.82(per 100

Kg)

14

2 Spices &

condiments

market

Rs. 6.00 -- “ --- ---“---

3 Oilseeds market Rs. 6.00 ---“--- ---“---

4 Food grains &

pulses market

Rs. 2.75 ---“--- ---“---

5 Fruit market Rs. 10.00 Per pati/pati/bag

Rs. 2.25

Rs. 1.81(per 100

Kg) Rs. 0.57(per

peti/peti) Loose

truck Rs. 150/-

6 Vegetable

market

Rs. 8.00 ---“--- Rs. 0.68 (per

peti/peti/bag) Rs.

0.45(leafy veg.)

(Per 100 Nos. of

judis)

15

16

17

Functions performed at collection centres (millers)

Primary Marketing Functions:

1. Assembling: Assembling means collecting and bringing together goods of the

same type from various sources or places of supply at a central place. A trader

dealing in agricultural produce collects the goods lying at different places from

different farmers and then brings the goods as a central place for the purpose of

selling. The farmers are highly scattered over a wide geographical area and they

produce in small quantities. There are variants with regard to quantity and quality

of the produce. Therefore, Assembling is an important function and many

intermediaries participate in the process.

a. In case of APMC market farmers directly bring their produce to the nearby

market.

b. Big farmers collect produce from the small farmers.

c. Mobile Merchants who move from village to village to collect agricultural

produce. Kachcha arhatias assemble the produce in the market.

2. Processing: activities to convert raw materials and bring the product near to

human consumption. It involves change in the form if the commodity. It adds

value to the produce.

a. Paddy to boiled rice and raw rice.

b. Tea processing

c. Coffee processing

d. Cashew processing

e. Milling of pulses.

3. Distribution: After assembling and processing, the farm produce is taken to the

market for consumption. This involves storage, of ownership of the produce

through intermediaries and physical movement of stocks.

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Secondary Marketing Functions

1. Standardization and Grading : Standardization involves fixing certain norms

for the products. The norms are established by customs and tradition or by

certain authority.

Grading follows standardization and refers to classification of produce based by

standards. Standardization and grading benefits both the producers and

consumers. It helps the consumers since they are able to get goods of standard

quality and helps the producers in getting better price for their products.

2. Packaging: The main objective of packaging is to preserve the quality and

quantity of the produce during the storage and transit. It also helps in easy

handling of the produce.

a. Cotton after ginning is pressed into bales.

b. Fruits like apple, grapes are packed in hardboard boxes.

3. Transportation involves moving the agricultural produce from the place of

production (farms) to the place of consumption. Agricultural products are

perishable and therefore quick transportation from the farm to the

consumption centres is required to maintain the quality of the produce.

Transportation cost and handling charges for the agricultural produce are high

due to long distances between farm and market nad number of middleman

between the producer and consumer.

4. Storage: While agricultural production is seasonal, the consumption takes

place throughout the year.

a. Commodities like potatoes, apples can be stored in cold storage to

make them available during the off-season also.

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5. Financing: Agricultural produce takes place in the interior villages. The

produce has to be moved long distances and takes place long time to reach the

consumers and capital remains locked up during this period. Credit and money

have to be made available to meet the cost of selling the produce to the final

consumer.

6. Selling involves identification of different categories of customers,

understanding their needs and wants and supplying the produce to meet their

requirements and collecting money for the produce sold.

20

System of Sale in APMC Market

Wholesaler-to-Wholesaler

Wholesaler-to-Agents

Wholesaler-to-Corporate

Wholesaler-to-Consumers

1. Cash Basis

2. Credit Basis – only by agents

Methods of Sale carried out by APMC Market

i. Sale by Sample

It is the most convenient method of sale where the produce is systematically graded. It

saves the cost of transportation and inspection. However, utmost honesty in the dealing is

to be followed. The producer or the commission agent shows the sample to the trader and

finalizes the price. Example – During the auction of chilies, the buyer quotes the price for

the produce by looking at the samples. This sale by sample is also practiced in food grain

sector. Food grains such as wheat, rice, etc. are bought by buyer and to verify that the

quality matches the sample they hit the gunny bag with sickle and check the food grains.

ii. Open Auction: The farmers undertake a bidding process in which the

commission agents bid over the prices of the produce being auctioned and the

produce is sold by the farmer to the highest bidder.

iii. Dara sale: In this system, the heaps of grains of different quantity/quality are

sold at a fixed price. The advantage is that within a short time a large number of

sales can be affected. Hence, the buyer may get better quality of produce at an

21

average price. Also, the farmer will not spend more on HYV seeds or any such

agricultural inputs that will increase the quality of the produce if the method of

sale is Dara sale. Example – This type of sale is practiced in onion and potato

market .As such there is no wholesale market for commodities like oil, masala

powder, etc. These commodities are available in any market at a wholesale price.

iv. HATTA Sale (Under Cover)

This method of sale is legally not permitted to be practiced in the regulated markets. But

it is learnt that Hatta or undercover sale is practiced in the fruit and vegetables market.

Codes:

1 finger = Rs 10

1 tapping = Re 1

Fist = Rs100

E.G: holding 3 fingers and then tapping the finger 2 times would communicate Price of

Rs.32/kg.

If the prices are acceptable to both the parties, lapping hands signals the deal as done.

The main reason why it is practiced is well justified by the wholesalers in the market.

Acc to them there has been a sharp increase in the number of retail clients visiting the

A.P.M.C market. If the prices offered to the wholesale buyers are negotiated via talking

or discussing loudly, even the retail buyers would demand a similar price which would

not be acceptable to the wholesale buyers or sellers.

So, with a view of maintaining confidentiality of wholesale prices the hatta

system is often practiced in the market.

22

Facilities * Infrastructure Available in the Market or nearby Market

Sr.

No.

Facilities/Infrastructure Number Capacity

1. Cold Storage 20 30,000 MT

2. Waxing/Grading Line 01 3 Ton/hour

3. Ripening Chambers 01 7 Ton

4. Packaging unit 01 8 Ton

5. Vapour Treatment Plant 01  

6. Rest House for farmers 01 30 no.

7. Post Office 01  

8. Banks 15  

9. Independent Police Station 01  

10. Central facility Building 05  

11. Weigh bridges 08  

12. Dispensary 01  

13. Export House 02  

14. Sanitary Blocks 04  

15. Passenger transport facility -  

16. Restaurants/Canteen -  

Tax provision in Maharashtra -

The traders in the APMC market are liable to pay tax as mentioned:

23

Food grain sector – NIL

Masasla market – 4% VAT

Cash crops – 12% VAT

Insurance –

Market provides Fire as well as Flood Insurance. However, after the 26 July deluge in

Mumbai, the traders of the APMC Market are no longer provided the facility of Flood

insurance.

Loan –

As a supplement to the finance of APMC, the Maharashtra State Agricultural Marketing

Board gives some amount as loan to enable APMCs to undertake developmental

programmes. However, MSAMB insists on availing loans from Banks by the APMCs for

their development programmes. The development works include land, drinking water

facility, compound wall, gate, internal roads, electrification, auction halls and platform,

godowns, computers, farmer’s hostel, trader's and commission agent's shops, etc. The

loans are sanctioned as per the norms prescribed by MSAMB.

APMCs submit the loan applications with details, which are being processed at the head

office. As per the rules of the Marketing Board, the rate of interest for development

works are as follows:

Sr.

No.

Class of APMC Rate of Interest

1 Class A and B 12%

2 Class C and D 10%

3 Konkan and Tribal Area 8%

Role of Banks –

24

Financial institutions such as ICICI, SBI, COSMO Bank, UNION BANK, HDFC, etc are

located around the market due to the proximity of these Financial Institutions; it becomes

very convenient for traders to do the daily transactions. They also provide banking

facilities to these traders such as loans, credit facilities, ATM’S, etc.

Factors Affecting Price:

25

The pricing decision is dependent on a number of factors:

Main Market – The Commission agents update the A.P.M.C merchants

about the prevalent market prices on a day to day basis. The prices in the

A.P.M.C market change accordingly.

Season and Supply – During the winter season from December to

February, the supply decreases and thus the price rises during this period.

Price varies during the other seasons as per the supply. For eg. If there is a

very heavy rainfall and the crop has damaged, then the prices will rise.

Basically, it is dependent on the demand – supply conditions.

Brand – There are a lot of brands available in case of grains and this has a

major impact on the prices. There are certain well established brands

which enjoy high recognition and are sold for higher prices.

Multi-Commodities Exchange (MCX) – Today, due to the emergence of

Multi-Commodities Exchange and easy internet accessibility, the

merchants pricing decisions are affected by the prevalent MCX prices.

Transport conditions – The transport route and charges also affect the

prevalent prices of the grains.

Rains : This is a major factor in determining the total quantity of

production, which is the total supply which determines the price in

coordination with the demand.

PRODUCT HANDLING AND WASTAGE

26

Product Handling -

In APMC, product Handling is majorly performed manually by laborers. These

laborers work on daily basis and transfer goods and commodity from one katta

( shop) to another katta or from katta to trucks. On the other hand product handling

during trading between APMC and retailers or semi-wholesalers is done in 3 ways:

i) Trucks: Trucks and Tempo’s are used as medium of road transportation in

order to cover shorter distances and to reach the interiors of city.

ii) Railways: Railways are also used as a medium of transportation goods to

longer distances. They are comparatively cheaper when it comes to road

transportation.

iii) Steamers: Some of the commodities from APMC Market are also exported

and imported. Therefore, Steamers are used as a medium of water

transportation.

Daily wages of laborers in APMC are as follows:

Kg Amount

30 kg Rs. 2/-

50 kg Rs. 4/-

100 kg Rs. 6/-

Wastage -

Generally, in all the sectors of APMC the production of wastage is very low.

However, in Fruits and Vegetables Market, wastage is up to 35% of the overall

produce as these goods are perishable in nature. Hence, in order to reduce this

wastage, the wholesalers sell them at a lesser amount compared to the original price.

TRANSPORTATION FACILITIES

27

For the smooth functioning of the entire market, efficient and effective transportation is a

must. Transportation facilities are widely used from Village APMC/ Mills to APMC and

from APMC to retailers/ Semi-wholesalers and vice-versa. Any type of obstacles during

transportation can largely hamper the working in the APMC market. There are 3 modes

of transportation:

1) Road transport – Trucks and Tempo’s

2) Rail transport

3) Water transport – Steamers.

Daily average arrivals of all Agricultural commodities is 3500 trucks per day approx. 1

truck has the loading capacity of 10 tones (approx).

Transportation cost forms a major cost factor compared to the other costs of a

commodity. Higher the transportation cost, higher will be the price of the commodity.

Trucks and Tempo’s deliver the goods area wise and the cost is bared by their customer.

A single transport agency receives approx 30 to 35 contracts on a daily basis.

There are various associations formed in order to manage the transportation facilities

such as:

- Mathadi Kamgaal Pranit Association.

- Retail Motor Transport.

- Tempo Owners Association.

- Local Tempo Association

These associations handle the entire day to day working of transportation. These

committees also provide solution to the local transportation problems.

- Letter Box

CONTRACT FARMING

28

Contract Farming takes place between farmers and the contractor. According to this

contract, the farmer has to plant  the contractor’s crop on his land. Post harvest the farmer

needs to deliver the promised produce to the contractor, based upon anticipated yield and

contracted land. This could be at a pre agreed price.

In the APMC Market, Contract Farming is not practiced by small or local parties. Till

date contract farming was not practiced in any of the APMC’s in Maharashtra. The State

Government has thus realized the importance of contract farming and is therefore making

necessary efforts to promote the same.

Maharashtra will soon join the ranks of Andhra Pradesh, Gujarat, Karnataka, Punjab and

Tamil Nadu in promoting contract farming. This move is ostensibly aimed at bailing out

the farming community from its distress, manifested in the number of unprecedented

farmer suicides in the state in recent months. The state government has proposed an

amendment to the Maharashtra Agriculture Produce Marketing Act to allow corporations,

retailers or food processing companies to directly enter into agreements with farmers to

market their produce.

The corporate sector has been the first to rejoice, much before the farmers who are the

supposed beneficiaries of the new Act. Multinational giants like Metro Cash & Carry,

Cargill Foods, Hypercity, Shoprite and Wal-Mart have signaled their intention to get into

agreements with Maharashtra’s farmers.

Many states in India are promoting contract farming, ostensibly to allow “technology

transfer, capital inflow and an assured market” for crops.

Reliance is the first major player to have shown interest in getting into contract farming

after the Act was passed. Reliance’s proposal has been submitted to the state’s director of

marketing. The RIL plan will be studied in accordance with the state’s policy on contract

farming. The government may seek further information from RIL on its proposed crop

pattern before it decides on its proposal. “This is to ensure that the land quality doesn’t

get affected.

29

Reliance Industries wants to lease about 100, 000 acres of prime farm land in Pune to

grow tonnes of vegetables, flowers and other produce required to feed its huge retail

operations.

The fabrics-to-oil giant has submitted a proposal to the Maharashtra government seeking

over 100,000 acres of farmland on a 50-year exclusive lease. According to the state’s

policy on contract farming, which allows corporates to take farm land on lease and strike

a buyback agreement with the farmers for the produce by paying market-related prices.

This is designed to ensure better prices and a ready market for farmers, while at the same

time, allowing companies to deal directly with farmers, bypassing middlemen.

RIL is not seeking to take over the land belonging to the farmers. It wants the land on

lease and will pay a fixed price of Rs 4,451 per acre per year. It’s like BOT. Instead of

build, it will be cultivate-operate-transfer. RIL will also pay market price to the farmers

for their produce.

AGMARK GRADING AND STANDARDISATION -

Objectives

30

Promotion of Grading and Standardisation of agricultural and allied commodities under

Agricultural Produce (Grading & Marking) Act, 1937.

Salient features

Quality standards for agricultural commodities are framed based on their intrinsic quality.

Food safety factors are being incorporated in the standards to complete in World trade.

Standards are being harmonized with international standards keeping in view the WTO

requirements. Certification of agricultural commodities is carried out for the benefit of

producer/manufacturer and consumer. Certification of adulteration prone commodities

viz. Butter, Ghee, Vegetable Oils, Ground-Spices, Honey, Wheat Atta etc. is very

popular. Blended Edible Vegetable Oils and Fat Spread are compulsorily required to be

certified under Agmark. Facilities for testing and grading of Cotton for the benefit of

cotton growers is provided through six cotton classing centers set up in cotton growing

belt in the country. During the year 1999-2000, agricultural commodities worth

Rs.429767 lakhs were graded and marked under AGMARK. Check is kept on the quality

of certified products through 23 laboratories and 43 offices spread all over the country.

APMC traders also require AGMARK Certificate for maintaining the quality of the

produce.

Fully Automatic grading system for fruits at Vashi Market Trade of coconut at Vashi Market

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LICENSES AND CERTIFICATIONS.

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Licensing of market functionaries is dispensed with and a time bound procedure for

registration is laid down. Registration for market functionaries provided to operate in one

or more than one market areas. The following licenses are required in APMC:

- APMC License

- Food Dealing License (FDL) – Food Grain Sector and Masasla Market

- Pulse Dealing License (PDL)

- MPSA License – Drug License. This license is required to curb adulteration in the

market.

During the commencement period, approx Rs. 5000/- is to be paid by the traders as

certification fees. This certificate needs to be renewed on a yearly basis for which a

nominal fees is charged.

If any trader is found without license then he is liable to pay Rs. 10,000

ROLE OF GOVERNMENT

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The State government plays a way crucial role in the working of APMC.

Provision made for imposition of single point levy of market fee on the sale of notified

agricultural commodities in any market area and discretion provided to the State

Government to fix graded levy of market fee on different types of sales. Provision made

for resolving of disputes, if any, arising between private market/ consumer market and

Market Committee.

The State Agricultural Marketing Board made specifically responsible for promoting

grading, standardization and quality certification of notified agricultural produce and for

the purpose to set up a separate Agricultural Produce Marketing Standards Bureau.

The government also intervenes by releasing buffer stocks during crisis in the market.

Also in order to order to reduce exploitation in the market, government sets up the

minimum. Support price for the produce sold in the market area. It states that the market

should have a specified quantity of goods and it should not exceed the stated stock limit.

However, this is not practiced in the state of Maharashtra.

Only 1/6th of the total production of the market is allotted to the government under State

Trading Corporation.

For example, once in the food grain sector, scarcity of pulses had arise. Therefore, the

government created an action plan and stated the new stock limit i.e Retailers up to 750

quintals and wholesalers up to 3000 quintals.

Steps Taken by the Maharashtra State Agricultural Marketing Board (MSAMB ) for Betterment of Farmers

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FARMERS MARKET (SHETKARI BAZAR):

The farmer has no say while fixing price of his produce in the market. In present

agricultural marketing system a no. of middle men are involved till the produce reaches

the final consumer, as a result the farmer gets only 30 to 35% of the every rupee paid by

the consumer. Farmer’s market (Shetkari Bazar) is a concept of direct marketing, by

producer (farmer) to consumers.

Objectives of Shetkari Bazar

To help farmers to get the reasonable rates to their produce.

To benefit consumers by giving him fresh produce at reasonable prices.

Immediate value realization of the produce to the farmers without any deductions.

To provide produce in appropriate weights and measures to consumer.

To bring Producers and Consumers together to avoid chain of middlemen.

The minimum facilities made available to the farmers and consumers in the Shetkari

Baazar are as follows:

1. The covered sale platforms (Ottas) of 6'x 8' Size for the farmers. These ottas will

be made available to the farmers on "first come first serve basis".

2. Drinking Water Supply.

3. Parking area.

4. Garbage disposal arrangements.

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5. Office for the supervising staff of APMC.

6. Ladies and Gents Toilet.

7. Vegetable washing Platform.

8. Grocery Shop.

9. Shop for Agricultural Inputs.

10. Canteen

11. Telephone Booth.

12. Compound Wall.

It is proposed to set up Shetkari Bazars in the state in following three phases:

In first phase the Shetkari Bazars will be set up at all districts head quarters in the

state

In second phase the Shetkari Bazars will be set up in the cities where the

population is more then 1 lac.

In third phase the Shetkari Bazars will be set up in all importants cities in the

state.

Shetkari Bazars in operation            = 05

ONION STORAGE STRUCTURE:

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Maharashtra State produces 25-30% onion of the total production of the country.

Maharashtra State contributes about 80-85% in the total onion export. Out of the total

onion production in the State, 10-15% onion production is in Kharif season, 30-40%

production is in Late Kharif and 50-60% production is in Rabi/Summer season.

Generally onion produced in Kharif and Late Kharif season is not suitable for storage

while onion produced in summer season can be stored upto 5-6 months and it can be

brought in the market during rainy season i.e. from June to October.

There are certain problems which arises during conventional storage of onion viz. loss in

weight, sprouting and rotting of bulb. To overcome these losses onion must be stored in

scientific manner and its prices.

MSAMB with the help of NABARD and National Research Centre for Onion and Garlic,

Rajgurunagar has developed revised plan for scientific onion storage (Kanda chawl) to

promote onion producers for scientific onion storage. The onion storage as per this plan

will minimize the storage losses and quality deterioration of the onion which will in turn

help the farmers to fetch better prices for their produce. To encourage the farmers for

setting up of scientific onion storage systems, MSAMB has formulated the subsidy

scheme for scientific onion storage.

The construction cost of the onion storage structure is assumed at Rs. 6000/- per MT for

this scheme. As per the scheme, subsidy to the extent of Rs.1500/- per MT storage

capacity

RURAL GODOWN SCHEME (GRAMIN BHANDARAN YOJANA)

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In India about 165.77 mill. Ha land is under agriculture, producing 526.77 mill tons of

agriculture produce comprising mainly food grains, pulses, oilseeds, cotton, jute,

sugarcane, etc. The agriculture production of the country has increased four fold during

the last five decades. However, in spite of being self sufficient in production of food

grains, the farmers are unable to obtain remunerative prices for their produce. They lack

sufficient storage facilities, distributed in various parts of the country. So under Rural

Godown Scheme, farmers will be provided with appropriate storage facilities.

GRAIN HANDELING UNIT:

As an additional value added service to farmers, bringing their grain for sale, some

APMC’s in the State have set up Cleaning and Grading machines for grains. The machine

is set up in the APMC yard and the farmers can get their grain cleaned and graded on

charge basis. This has helped farmers demand and get better prices for their produce and

the trader and consumer gets a clean and graded produce a treasonable charges. This has

resulted in more and more farmers coming forward to use the facility.

PROJECTION TV SYSTEM FOR MARKET INFORMATION DISPLAY:

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MSAMB is collecting arrival and price information of Agricultural Commodities from

various APMC’s through MARKNET. For Dissemination of this information to farmers

and other concerns, new scheme of install. Under this scheme, Projection TV System is

installed at Market Yard in such a way that, daily arrivals, prices and Agricultural

information can be displayed effectively for the benefits of farmers and other concerns ,

new scheme of installation of Market Information Display has been started by MSAMB.

Functioning: Each of the APMC participating in the scheme has Projection TV System

connected to computer with software for information display and Internet connectivity.

The consolidated information of arrival and price is made available on MSAMB's web

site. That is downloaded on the computer of Projection TV. The information can be

displayed either APMC wise or Commodity wise on the TV through customized software

developed in regional language.

Besides displaying price information, this System is used for following purposes.

1. To display the information related to Post harvest technology, grading, packing etc.

2. To display the information about new technology in agriculture, new seeds, fertilizers,

pesticides, various crop diseases and solution for the same etc, for the use of farmers.

3. The information about various schemes, projects of the State and the Central

Government.

4. For the training of farmers.

5. While displaying price and other information, various advertisements can be displayed

on commercial basis to get the revenue, which can be used for maintenance of this system

CONTROLLING AUTHORITY

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GROMA – Grain, Rice and Oilseeds Merchant Association

The controlling authority for the grain market is GROMA. It undertakes the

registration of brokers. This helps to regulate their activities and also curb any kind of

illegal activities.

The main benefit for brokers, on registration, is they can acquire the grains as per

their requirement and in sufficient quantities. This is not the case with the

unregistered brokers; they are not assured of the entire quantity as per their

requirement.

The association is 105 years old. About 600-650 grain merchants are registered with

the authority. The entire trading is highly regulated as regards to damaged grains or

pilferated grains dealing, corruption, etc.

There is a casual checking held every 6 months. The stock limit prescribed for cereals

and pulses is 3000 quintals per trader. There is no limit for stocking of rice.

The authority conducts a meeting every 6 months with the merchants to enable them

voice their opinions.

The authority specifies the following rules:

In case of a weighing error and subsequent calculation error of the total bill

amount, the weight and amount of the authority books will be considered

final.

Sales Tax, General Tax, VAT and any such other taxes have to be borne by

the customers over and above the cost of products.

In case of any association or Dharmada being the buyer, they have to pay the

other relevant Taxes also.

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Once the goods have been sold and delivered, the authority or merchant will

not be responsible for it.

Until and unless, the total amount specified in the bill is not paid, the

merchant has a prior lien over the goods.

The goods are sold under the Maharashtra State’s Food Grain Licensing Order

Law.

Pilferated, damaged or lower quality goods are sold as animal food.

According to the weighing rules, the goods are given at Net Weight, the buyer

has to return the gunny sacks or pay as under:

o Cereals, pulses, general items Rs.14/-

o 50 kg gunny sack Rs.7/-

o Cotton, covers in a gunny sack Rs.7/-

o Gunny sack per kg Rs.40/-

The buyer has to bear the following expenses over and above the bill amount

and this is also the source of income for APMC market:

o Marking Fee 0.75 paise

o Supervision charges 0.05 paise

o Entry charges 0.20 paise

In case of credit sale, the following charges per day on delayed payment:

o Payment within 30 days after due date Rs.1.75 %

o Payment after 30 days after due date Rs.2.50 %

(1.75 + 0.75 % delayed charges)

The goods are cleaned once but the user is expected to clean them once again

for safety purpose.

The payment for the goods has to be made to the person at the “pedhi” (cash

counter). The authority is not responsible for payment made to any other

person.

Problems:

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o Lack of awareness among traders and farmers about different facilities provided

by APMC such as VST and VHT.

o Distribution chain is still long because farmers don’t directly come to APMC

Vashi, as there is no village near by.

o Middlemen’s are unavoidable part of market functions.

o Low wages to Hamali and Mathadi people which leads to mismanagement and

strikes.

Suggestions:

o Awareness should be generated among farmers about cooperative marketing of

agricultural produce and various schemes that are provided by State Boards.

o Farmers cooperatives should be formed which will lead to economic benefit of

farmers as they can demand high prices for their produce due to various variety

and higher quantity of produce.

o Even economies scale can be achieved and different cost such as transportation,

weighing, packing , storage etc. due to cooperative marketing.

o Even farmers should be given education and training related to new facilities

available for processing, storage,etc to improve their produce.

o Government should focus on decreasing intermediaries:

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o They should focus on using electronic auction halls like:

o Mechanised Handling of Produce:

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o To link Farmers to the Markets by shortening supply chains and enhance

efficiency, thus increase Farmer’s income

o Provide professionally managed competitive alternative marketing structures

that provide multiple choices to farmers for sale of agricultural produce; To

drive reforms in agricultural marketing sector resulting in accelerated

development of marketing and post harvest infrastructure including cool chain

infrastructure in the country through private sector investment;

o To bring transparency in the market transactions and price fixation for

agricultural produce and through provision of backward linkages to enable

farmers to realize higher price and thus higher income to the farmers.

Some New Markets Coming up

o Mumbai Flower Auction Market at Goregaon (east).

o Thane Terminal Market

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