Transcript Slide 1

Efficient Agricultural Marketing System
and
Modern Infrastructure Required for Minimizing the
losses While Handling the Agri. Produce
N.S.Ranawat
Deputy Director
National Institute of Agricultural Marketing(NIAM)
JAIPUR
Part-I
Efficient Marketing
System
Agricultural Scenario – Present Status
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All major Climates of world. There are 20 agro-climatic regions
and nearly 46 out of 60 soil types in the country. Potential to
cultivate vast range of agricultural produce, a large and varied raw
material base for food processing.
Increase in production from 50 million tonnes (1951) to 204
million tonnes (2004-05).
Significant increase in marketed surplus.(110.04 million tonnes,
2001-02).
Subsistence to commercial agriculture.
First in pulses, tea, jute & milk and second in rice, wheat, fruit &
vegetables.
Agricultural Scenario – Present Status
India’s annual food production stands at 550 million metric tonnes
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Second highest fruit and vegetable producer in the world with a cold
storage facility available only for 10 per cent of produce
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Second Highest producer of milk
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India has highest cattle population (185/1345 million (13.8%), Largest
buffalo population 98/174 million(56%), second highest sheep and
goat population(183/1839million)(9.95%) producing about 6million Mt
of meat with a Cold storage capacity 184,000 tonnes.
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Fifth largest producer of eggs. Projected requirement of investments in
cold storage required to store 20 per cent of surplus of meat and
poultry products.
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Sixth largest producer of fish with harvesting of 5.2 million tonnes
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The estimated area under flowers (2005-06) is 0.126 million hectors
with a production of 0.694 million tonnes loose flowers and 2762
million cut flowers.
Agricultural Production-2007-08
(Ministry of Agriculture, GOI)
S.No
.
Commodity
Production (2007-08) Production (2007-08)
*Estimates
1
Rice
96.43
92.35
2.
Wheat
78.40
75.81
3.
Course Grain
40.75
33.92
4.
Pulses
15.11
14.20
5.
Food Grains
230.67 (124 million Ha)
217.28
6.
Oil seeds
28.83
24.29
7.
Sugar Cane
340.55
355.50
8.
Cotton
25.81
22.63
9.
Jute & Mesta
11.18
11.27
10.
Fruits
62.85
58.92
11.
Vegetables
116.03
122.25
12.
Flower (Loose)
Flower ( Cut)
178
778
805
177
13.
Spices
39.82
43.07
Production status change over last fifty yearCommidity
(2001-02)
1950-51,Mt
2000-2001,Mt
Food grain
50
206 (99-2k)
Oil seeds
5
24.5
Fruits
12
41
Vegeatble
10
72
Potatoes
1.7
25(24.2) (1998)
Onion
1.0
5.5(4.75)
Mushroom
40kt
Livestoc & Poultary
Milk
17
78(99-2k)
Meat
0.7(1971-72)
4.6
Eggs
10 bn (#) (1980-81)
30 bn (#) (99-2k)
Fish
0.75
5.6 (99-2k)
Marine
2.9
Fresh water
2.7
Honey
0.7 kt (1963-64)
5.5kt
Coconut
4.5 bn (#)
15bn (#)
Spices
Sugarcane
3
57
Certified seeds
Lac
309.4
0.75
40 kt
20 kt
Cotton
0.7
2.5
Jute
0.67
1.67
Coir
0.13 (1954-55)
0.34
Wool
32 kt (1980-81)
45 kt
Fibre crop
Market Regulation in India – An Overview
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It goes without saying that marketing and production of
agricultural produce are inextricably intertwined with each
other. In the post WTO regime, an effective agricultural
marketing system is the key driver of the agricultural economy
of a country.
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An effective marketing system aims at ensuring remunerative
prices to the producers at cost effective marketing costs and
smooth supply of commodities to consumers at reasonable prices.
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In order to protect the interests of the various stakeholders of the
agricultural marketing system of the country a number of
governmental interventions have been taken from time to time.
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However, the present agricultural marketing system of the
country leaves much to be desired.
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Some reform measures by the government have already been
initiated to address these issues and some are in pipeline.
Agricultural Markets
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Apani Mandi / Farmers market / Raythu Bazars
Rural Primary Hats/ Periodic Rural Markets
Market Sub yards
Primary Market Yards/ Agri. Produce Market Committee (APMC)/
Mandi,
Secondary Market Yards/ Secondary Markets
Modern Market yards
Wholesale markets-Perishables
Terminal Market yards-Perishables
Future Markets
CHARACTERISTICS OF TRADITIONAL AGRICULTURAL
MARKETING SYSTEM
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Heavy Village Sales of Agricultural Commodities
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Farmers were hard pressed for money to meet their social and
other: obligations, and are often forced to sell their produce right
in the villages.
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Most of the perishable products need to be marketed in the
villages because of their low “keeping” quality and the nonavailability of quick transport means.
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Many farmers disliked city markets mainly because of their lack
of knowledge about prevailing market practices, the possibility of
theft or robbery in transit and problems faced by them for selling
their produce in city markets.
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The information on the prices obtaining in the nearby primary
and secondary wholesale markets was not readily available to the
farmers.
CHARACTERISTICS OF TRADITIONAL AGRICULTURAL
MARKETING SYSTEM
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Inadequacy of Institutional Marketing Infrastructure and Lack of Producers’ Organizations
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Multiplicity of Market Charges
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Existence of Malpractices
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Lack of Reliable and up-to-date Market Information
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Low Marketable surplus of a Large Variety of Products
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Absence of grading and Standardization of Produce
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Absence of Quick Transport Means
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Strong Associations of Traders and Market Functionaries
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Post-Harvest Immediate Sales by Farmers
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A majority of the cultivators tend to sell their produce immediately after the harvest at
the low prices prevailing at that time.
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Because of substantial supplies, Indian markets are glutted in the post-harvest season.
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Traders often take advantage of this situation. About 60 to 80 percent of the food
grains are still marketed in the first quarter of the harvest season
Farmers have to travel for markets beyond 5 Kms for
sale of their agricultural produce.
•Fledgling Rural Primary Markets.
•Absence of common trade language and multiple
Food Laws.
•Variation in market fees and other market charges.
•Controls under Essential Commodities Act, 1955.
•Poor Pledge Financing and Marketing Credit. Farmers
dependent on money lenders for their credit need.
CHARACTERISTICS OF TRADITIONAL AGRICULTURAL
MARKETING SYSTEM
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Long and multiple marketing channels.
Farmers share in consumer’s Rupee
- Fruit and vegetables – 32 to 68%
- Paddy – 56 to 89%
- Wheat – 72 to 88%
- Coarse grains – 72 to 86%
- Pulses – 79 to 86%
Hidden marketing cost and margins are also common
– Rs. 15/- for 20 Kg. box of apple and Rs. 12/- for 50
cabbage bag from Shimla to Delhi by road – a study
reveals.
Contd…..
Regulation of Agricultural Marketing :
The features like high marketing cost, unauthorized deductions, false
payment and prevalence of various malpractices prompted to regulate
agricultural marketing by the state.
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Establishment of regulated markets has been able to overcome the
problems of traditional marketing system to greater extent. However,
these problems still persists in the case of village sales.
Definition of Regulated Market:
Regulated market is one which aims at the elimination of the unhealthy and unscrupulous
practices, reducing marketing charges, and providing facilities to the producer seller in the
market.
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Any legislative measures design to regulate marketing of agriculture produce may be
termed as one which aims at the establishment of regulated markets.
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Establishment of regulated markets is not intended at creating alternate marketing system.
The basic objective is to improve the efficiency in the marketing system.
Basic Amenities available at APMCs
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Auction platforms only in 2/3rds markets
Drying platforms in 1/4th markets
Traders modules in 63%
Cold storage only in 9%
Grading facilities in 1/3rd markets
Internal roads in 80%
Farmers amenities in 50% of markets
Objectives of Regulated Market
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To prevent the exploitation of farmers by overcoming the
handicaps in the marketing of their products.
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To make the marketing system most effective and efficient
so that, farmers may get better prices for their produce and
the goods are made available to consumers at reasonable
prices.
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To provide incentive prices to farmers for inducing them to
increase the production both in terms of quantity and quality.
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To promote an orderly marketing of agricultural produce by
improving the infrastructural facilities.
AGMAKRNET
 Automatic Data
Downloading
DMI Hqs.
 Data validation
http://agmarknet.nic.in
 Crops Directorates (8) [Wheat, Jute,
Cotton, Rice, Sugarcane, Millets,
Pulses, Tobacco]
 Database updation
 Technology Mission on Horticulture
 Trend Analysis
 Coconut Development Board
 Monitoring Reports
 Commodity profiles for
production planning
 Data Warehouse & Data
Mining
 GIS based National Atlas
Public Access
Local
News
papers
CDB
Markets
Notice
Board /
Electronic
Board
Mobile
Operators
DMI State
Offices(27)
State Mkts./
Directorates
(50)
Farmers
Network
IFFCO
Regional
Office
Call Centres
Agri-clinics
Mobile
users
IFFCO
Network
Regional Portals
(8 already
approved)
CDB
Network
IFFCO
Area
Office
Area
Office
farmers
Area
Office
Kiosk
Farmers
Regional
Office
Regional
Office
Farming
Community
Agri-Markets in India as on 31.03.2007
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6261 Wholesale Markets in India (majority are regulated markets)
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20870 Rural Primary Markets (about 15% are regulated markets
Total – 27131
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2459 Principal Regulated Markets
5006 Regulated Markets Sub-yards
Total – 7465
(Only 286 regulated markets in 1950)
Part-II
Modern Infrastructure
Requirements
&
Minimization of PHM
Losses
Harvesting
Reception
Other
treatments
Packing and
packaging
Pre-cooling
Selection,
cleaning and
disinfection
Grading
Drying
Storage
Transport
Post Harvest Management
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Farm LevelHarvesting
Harvest maturity Indices
Harvesting Methods- Manual/ Mechanized
Harvesting tools/ kit
Collection- sorting/grading at farm
Harvesting Containers/Packing material
Farm level Storage
Market level
Mode of Transportation
Road conditions
Cleaning and grading at mandi
Weighment -Digital/ Pan balance
Storage at mandi
Packaging material/Bagging etc
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Other important factors
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Waxing, Drying
Grading and sorting
Packaging –CFB
Pre-cooling
Ripening / De-greening treatments
Cold storage at low temperature
Reefer transport
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Quality factors
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GAP certification, GHP, GMP & HACCP
Vapour heat treatment
Pesticide residue level
Irradiation
Packaging specifications
Product Standardization
Food safety at Farm, APMC, Storage,
Distribution / transportation and at retail mkting
Agricultural Produce
Agri Produce can be classified in a
broad way in two categories
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Non-perishables /Durables:-
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Perishable / Non-Durables:-
Cereals, Millets, Pulses, Oilseeds,
and seed spices etc. They are subjected to some unit operations before
marketing, some of them are as following i.e. Cleaned, Grading, Sorting,
De-hulling, Decorticating, De-husking, Polishing, Bagging and ware-Housing.
Fruits, vegetables, flowers, herbs,
spices, Eggs, Poultry products, Meat and fish etc. They are also subjected
to some unit operations before marketing, some of them are as following
i.e. Curing, Washing, Grading, Sorting, Waxing, Drying, Pre-cooling and
packing /Bagging and storage in Cold storage
Present level of production of different types of food
commodity and their estimates of post-harvest losses
S.No.
Type of food
Commodity
Present level of
production
losses
Quantity
(Mt)
Average
Price
(Rs./t)
Value
(Rs. In
Crore)
%*
Post-harvest
Quantity
(Mt)
Monetary value
(Rs.in Crore)
1
Durables (cereals pules,
oilseeds, etc.)
230
10,000
230,000
10
23.0
23,000
2
Semi-perishables
(Potato, tapioca etc)
40
3,000
12,000
15
6.0
1,800
3
Perishables
(fruits, vetetables. Milk, meat,
fish,eggs etc.)
210
15,000
315,00
20
42.0
63,000
Total/Average
480
11,604
557,000
14.8
71.0
87,800
* On Conservative Scale
(Ref: Agro-processing
Industries in India-Growth, Status and prospects- Kachru, R.P)
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Different hurdles for direct marketing including infrastructure;
Traditional marketing-Long marketing channel, low share in
consumer’s rupee, high costs and margins, irrational marketing fees
etc.
Infrastructural Bottlenecks- Rs. 11172 crore investment requirement
low per capita infrastructure limits the access of small and marginal
farmers to the market
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Small & marginal farmers 80%
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Need for reforms for congenial policy for private investment in
infrastructure
Marketing infrastructure
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A.O. Hirschman- four characteristics of
infrastructure
i) the services facilitate economic activity
ii) the services are public goods because of economic
externalities
iii) the services cannot be imported;
iv)investments tend to be indivisible or lumpy
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In this context, marketing infrastructure consists
of a combination of national assets, sustaining the
addition of place, time and form utilities
Marketing infrastructure
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Can be classified as physical facilities and
institutional facilities;
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physical facilities--roads, railways,transport,
postal,telecommunication facilities,
electrification,storage structure,market yard and
processing facilities etc;
institutional infrastructure—cooperatives,banking
institutions, extension agencies, marketing
Organisations and marketing intelligence network
Infrastructure Development
Exporti
Cooling
Vapur Heat Treatment
plant at Vashi
Pack house
Post Harvest Infrastructural requirements
Marketing infrastructure-Gaps
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The expert committee, Government of India(June 2001) made
an assessment of investment requirement of Rs.268742 crore for
investment in agricultural marketing.Bulk of the funds to be
mobilized through pvt.sector.
For a complete supply chain of perishable horticulture produce,
from farm to market: small pre-cooling units or zero-energy cool chambers at
production areas to remove field heat of the produce
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collection centers near to the farms
 Medium to small cold storages(multi-product & multichamber) as transit godowns
 Specialized cold storages with facility of built in pre-cooling,
high humidity and controlled atmosphere for storage of
produce for a longer period
 Other components like ripening chambers close to market
places and display cabinets at retail outlets
 Linkages for conversion of fresh produce into other
marketable forms
Marketing infrastructure-Gaps
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The integrated pack houses catering to farms in respect of regions
around 5000-10,000 hectare for washing, sorting, grading , packing,
cold storing etc.
E-trading for direct marketing through kiosks in the market yard
Telephones:- only 59% of villages covered(2001) , 3.5% tele-density
against world average of 16, target is 15% by 2015. Examine WCL
technology.
Rural connectivity:- Only 47.83% of villages covered till mid 90s. Av.
road length is 4 km. To connect each village with main road.
Investment requirement is Rs 74000 cr.
Physical facilities in regulated markets:- auction platforms, shops
and godowns etc; Rs 6026 crore during next 10 years
Marketing infrastructure-Gaps
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Specialised markets :- fruits and vegetables, 241 places in the country; 970
crore.
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Farmers’ markets:- Apni Mandis in different states. Should be in every
district at least.
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Rural periodic market- 27294 RPMs; investment requirement is Rs. 2146 cr.
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Storage/ warehousing:- 52 million tonnes storage capacity available , need
for creating storages for additional 20 million tonnes now stored in the form
of CAP( Covered and Plinth ), investment requirement of Rs.5400 crore
Cold storages:- 135 Million tonnes of fruits and vegetables, 30% post
harvest losses, during next ten years cold storage capacity of 45 million
tonnes for investment of Rs.27000 cr.
Marketing Infrastructure-Gaps
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Reefer Vans/ Containers- During next ten years 3000 units with a
capacity of 8 tonnes each; Investment requirement is Rs.600 crore
Cleaning,grading and packaging:- Grading facility available in only1321
markets out of the 7300 regulated markets. Rs.2000 crore investment
during the next 10 years.
Export oriented Agri-zones and Food parks:- estimated public
investment (common facilities)-Rs 200 crore and private investment is
Rs.400 crore on 50 EOAZs.
Processing and value addition:- Now 7% value addition and 2%
processing; Target 355 Va. Addi. and 10% processing; investment of
Rs150000 cr.
Ideal market – Infrastructure Requirements
Core Facilities
Platforms for Automatic weighing
Auction Platforms
Packaging & Labeling Equipments
Drying Yards
Loading, Unloading & Dispatch Facilities
Grading Facilities
Standardization Facilities
Price Display Mechanism
Information Centres
Storage/Cold Rooms
Ripening Chambers
Public Address System
Extension and Training to Farmers
Service Infrastructure
Rest Rooms
Parking
Sheds for Animals
Market Education
Soil Testing Facilities
Drainage
Support Infrastructure
Water Supply
Power
Veterinary Services
Sanitary Facilities
Posts & Telephones
Banking
Input supply and Necessity Outlets
POL
Repair/Maintenance Service
Office
Computerized Systems
Rain Proofing
Maintenance Infrastructure
Cleaning and Sanitation
Garbage Collection & Disposal
Waste Utilization
Vermi-Composting
Bio-gas Production Power
Grading
Grading of Onians
Wax layer restricts
the gases interchange.
Air in the internal
Cavity
Waxing and Grading of fruits
Pallet pre-cooling and transition to CA rooms
Ripening Chambers
PACKINGHOUSE OPERATIONS
Schematic of the typical unit operations in a mechanized packinghouse
Receiving,
inspection
Bin dump
presize
Wash / scrub
Initial cooling
Cold storage
Cull and byproduct
Automatic
Sorting & sizing
Hand sort
Dry
Wax
fungicide
labeling
palletize
Hand sort
Box
Fill
Hand sort
Box
Fill
Cooling &
storage
Special
operations
To protect the product from direct sun
light.
Quick transport to the packaging.
Minimize delays before pre-cooling.
Uniform product’s cooling.
Store the product at optimum temperature
conditions .
Practice first in first out rotation.
Ship to market as soon as possible.
Use refrigerated loading area.
Cool truck before loading.
Load pallets towards the center of the truck.
Avoid delays during transport.
Monitor product temperature during transport.
High Humidity Air Handlers
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Maintains up to 95% RH in the Cold
Store.
Advantage is to increase shelf life of the
fresh harvested produce.
Because 1 hour lost in pre-cooling may
result in 8 to 24 hour loss in shelf life
Objective: to remove the field heat.
Movement of the caloric energy from the
product to the cooling substance.
Pre-Cooling Chamber
Refrigerated storage
Packaging of Horticultural Crops
Packaging Basics…..from the viewpoint of the product
Help to maintain quality
Reduce water loss
Protect product from injury
Convenience
Traceability
Ease of transportation
point of sale packaging
Marketing product
Provides consumer information - labeling
Packaging Basics…..from the viewpoint of the package
Must be strong enough for the job
Moisture resistant
Facilitate special treatments
Low Cost – (costs to buy and dispose – OR REUSEABLE )
Compatible with packing line machinery / automation
Compatible with unitized handling operations
Package Diversity
> 500 different packaging formats used for horticultural produce
Transportation
Vibrations-Road Transportation
Modern Terminal Market
Infrastructure:
Banking Institution
Electronic
Auction
Processor
Exporter
Wholesaler
/ Trader/
Retail chain
operator
Storage:
Cold Storage,
Temperature
controlled
warehouse,
Ripening
Chamber
Packhouse,
Quality Testing
Facility,
Palletisation
Services:
Transport (incl.
cool chain),
Settlement of
Payments,
Banking, Market
information
Direct Selling
Infrastructure:
Collection Centre
Washing,
grading,
transport to TM
Services:
sorting,
weighment,
Collection & Aggregation of produce,
Settlement of payment, advisory on inputs,
prices, quality, multi-modal transport
Producers/ Farmers and
their Associations