How we can able to manage the role of middleman in buying and selling of Agricultural Commodities?
@ Jagjeet, very difficult unless and until government take strong initiative. Best way is to buy the product directly from the producer by the government and sell it through the government shop. Otherwise, one has to oiled and manage the distribution channel from producer to consumer.
Please also have a look of the attached file.
Atleast I am not optimistic about Indian scenario on the subject.Until and unless government support for a defined acreage in classified crop belts is not there, it is very hard to imagine.MIDDLEMAN IS SQUEEZING almost most of the crops ,say onion in maharashtra, potato in north india, tomato in HP and many more cases.
Cooperative culture is not fully successful due to certain bottle necks in Punjab state.
The concept of farmers market is very sucessful in mohali and nearby areas. We have to adopt that model for whole punjab.
I think it is a nice idea to have farmers market in different states with different commodities and government may help to establish that market and procure from the market for reserve if it is surplus.
Upgrading of value chain network - structure. If it's farmers then they need to form a cooperative to match or have higher bargaining power like the exporters. However upgrading of governance structure may be necessary as well like support services from government.
The solution is so simple... on one hand, corruption must be eliminated, on the other hand, motivate producers to organize and build their own systems to make possible to allow consumers to buy their productos wothout middlemen. First, just eliminate the government participation. Usually the government create programs to promote buying and selling agricultural commodities, the problem is the distortion in real prices and volatility of them during transportation and transformation. You can add value to those commodities to teach producers how to do it. Government and corruption must leave the economic process. Just do the math.
One practical way is to reduce information asymmetry. Another is by developing multiple market channels.
The first thing to appreciate is that a middle man plays a very big role especially in poorly developed agric product value chains with low levels of organisation .In such value chains eliminating the middle man will even have more disastrous effects on the rural economy.
supporting rural farmers to form rural producer organisations(RPOs) that are well linked to stakeholders at higher nodes of the product value chain (e.g processors) can help.How ever for this to work better, contractual arrangements may need to be negotiated.Alternatively supporting RPOs with skills,knowledge and infrastructure to do value addition and facilitating linkages with wholesalers,retailers and customers can do a good job
These require a supportive government policy especially that that seeks to promote cooperative models of financing
The ways to manage middlemen role for marketing agricultural produce by the farmers are as follows:
1. The farmers should build storage/warehouse where each of them can store their produce before transporting to the market place.
2. The government or the farmers group should map out a common area that is nearer to the consumer with road access in order to build market place where those produce will be displayed for selling to the consumers.
3. The farmers have to advertise their produce and market place through the media that is available in their location.
4. The farmers can cooperatively buy lorry that is suitable for transporting their produce to the market place.
5. The farmers can assemble their produce and partner with industries that utilize their produce as raw material in order to supply for them.
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