VEGETABLE SUB SECTOR STUDY TO UNDERSTAND THE SUPPLY CHAIN COORDINATION IN DARRANG, BARPETA AND KAMRUP DISTRICT OF ASSAM

A collaborative inhouse Study of CML NOVEMBER 2010

CENTRE FOR MICROFINANCE & LIVELIHOOD 13 J. Baruah Road, Guwahati Club, Guwahati -781003 Assam, India
Ph: 0361-2660323, E-mail: cmlghy@gmail.com, Website: cmlnortheast.com

VEGETABLE SUB SECTOR STUDY TO UNDERSTAND THE SUPPLY CHAIN COORDINATION IN DARRANG, BARPETA AND KAMRUP DISTRICT OF ASSAM

Study Team Binota Loitongbam, CML Piyush Saurabh Sharma, Independent Researcher Sabiha Mazid, Research Associate Support & Guidance Mr. Partho. S. Patwari , Coordinator, CML

Centre for Microfinance & Livelihood (CML) 13, J Baruah Road, Guwahati Club, Guwahati-781003, Assam, India

Acknowledgement

We sincerely acknowledged all the people whom we interviewed during the course of the study. Without their valuable feedbacks the study would have been meaningless. We express our gratitude to Mr.Partho Patwari, Coordinator, CML for his continuous guidance & support. We also give special acknowledgement to Ms Sabiha Majid, research associate for her valuable part in conducting the field study. We also thanked those Institutions & the officials for their support in providing us data and relevant information.

With Regards,

Binota Loitongbam Saurabh Sharma

Contents
Chapter1 1.1 1.2 1.3 1.4 1.5 1.6 Chapter2 2.1 2.2 2.3 2.4 Chapter3 3.1 3.2 3.3 3.4 3.4.1 3.4.2 3.4.3 3.4.4 3.4.5 Chapter 4 Chapter 5 Annexures Background of the study Background of the study Darrang District Barpeta Kamrup Vegetable Production in kamrup,Darrang & Barpeta Total Vegetable production area Scope and Limitation of the study Scope of the study Objectives Methodology of the study Limitations The Vegetable Sub Sector study Understanding the vegetable sub sector Production Sector Wholesale Sector Retail Sector Names of retail markets studied Price Variation in the chain Factors that immediately affect the price Factors affecting market supply and demand and the market contracts Regulations Main Constraints & Opportunities of the vegetable sub sector Conclusions

Chapter 1
---------------------------------------------------------------------------------------------------------------------------Background of the study Agriculture continues to be main stay of life for majority of the Indian population. It contributes around 25% of the GDP and employs 65% of the workforce in the country. India is a leading vegetable producing country in world. Presently vegetable cultivation occupies 6.76 millions hectare area with the annual production of 101.43 million tones. The country being blessed with unique gift of diverse climate and distinct seasons, make it possible to grow an array of vegetables number exceeding more than hundred species. To ensure nutrition security of the growing population of the country, it is estimated that upto 2020, the country vegetable demand would be around 135 million tones. To achieve this target, it is important to integrate the various technologies right from production to post-harvest. Incessant growth of urbanization, ceaseless fragmentation of land holdings, depleting natural resources are the major challenges before the expansion of any agricultural commodity whether cereals or vegetables. There is a miss match in area production and productivity of vegetables among various states of the country. West Bengal ranks first in total production in the country with production during the year 2004-05 was in tune of more then 18.1 million tones contributing more than one fifth of total countrys vegetable production. Over the past two years Assam has been witnessing a huge rise in the prices of vegetables and other agricultural commodities. Historically Assam and other states of NE region have been self reliant in production of vegetables as it has been a traditional practice to grow vegetables in homestead of every house hold. But with spurt in population over the years has given rise to huge demand of vegetables not only in urban centers but also in rural belts. Though many pockets in Assam are famous for vegetable production for instance Singimari in Kamrup, Kharupetia in Darrang and Barpeta Road in Barpeta district, still these clusters have not been able to satisfy market demand and become export powerhouses. Darrang The District of Darrang (undivided) had been created with effect from July'1983 converting the erstwhile Sub-Division of Mangaldai. The name Darrang was derived from the Bodo word Dourang, which means 'Lilabhumi'(Playground) of Gods. According to Scholar Late Dineswar Sarma, the word Darrang came from Dawrang which means gate, as there was direct entry to Bhutan and from there to Nepal, China etc. Gradually this was known as Darrang. The existing Darrang district was formed on 1st July, 1983. The district has 6 nos. of Development Blocks.

The district in general is considered to be plain. On the north there exist the Udalguri District and mighty Brahmaputra flows along the southern boundary of the district. The main tributaries of Brahmaputra in this district are Barnadi, Nowanai, Mangaldai and Dhansiri. The forests within the district provide good amount of timber. The climate of the district is congenial. In the winter, the northern part of the district is colder than the rest of the district since it is covered by hills and forests of Udalguri District. The average temperature ranges from 10o to 30o C. Average annual rainfall is about 2120 mm. The district has 348100 ha of with 28353 ha under forest coverage with net sown area of 210241 ha. The soil of this district is very fertile for cultivation and the main crops are paddy, oilseeds, sugarcane and jute. The area is also known for its considerable tea productions. The main horticultural products are orange, coconut, pineapple etc. In addition, the district is rich with sizeable production of vegetables. Barpeta Barpeta is the headquarters of Barpeta district, Assam, India. Barpeta is renowned in the Historical map of Assam as the "Land of the Satras". These Satras bear the testimony of the great Assamese reformer, saint, Scholar and Cultural exponent Srimanta Sankardeva and his able disciple Shri Madhabdeva who arrived from Upper Assam back in the 16th century to lay down strong foundation of Assamese Culture in the region through his socio-religious Vaishnava-reform movement. This reform movement left a historic legacy. The Barpeta Satra and various other Satras scattered around the district attract devotees from every nook and corner of Assam. Barpeta District has 11 nos. of development blocks consisting of 840 villages (undivided Barpeta district having two civil Sub-Divisions namely Barpeta and Bajali. There are 3 (three) Agriculture Sub-Divisions i.e. Barpeta, Pathsala and Alupati Majorchar. The district is bounded by Baksa & Chirrang districts in North, Kamrup & Goalpara districts in south, Nalbari district in east and Bongaigaon district in west. River Brahmaputra flows through southern part of the district. River Beki, Manas and Kurishu are the main river of the district which originates from hills of kingdom of Bhutan to merge river Brahmaputra and causes devastating floods in the district. The district has 33000 ha of land area with 23441 ha under forest and 310815ha under agriculture. The soil Barpeta can be classified in sandy, sandy-loamy and forest soil. The main crops grown in district of Barpeta are paddy, oilseeds, pluses, and topping in vegetables production amongst all districts of Assam. The district also grows number of fruits like oranges, banana, Jackfruits and other fruits.

Kamrup The Present Assam was referred to as Kamrup in many of the ancient Indian literature. It was also known as Pragjyotishpur due to the astrology (Jyotish Shashtra) practices that prevailed in this part of the country during that time. However, "Kamrup" became a more predominant name in the later part of the history. Kamrup is bounded by Udalguri & Baksa districts in north, state of Meghalaya in south, Nalbari & Goalpara districts in west and Darrang & Kamrup metropolitan districts in west. Kamrup consists of 15 nos. of development blocks with 991 nos. of villages. The district has Sub tropical with semi -dry summer & cold in winter. The average annual rainfall in the district ranges from 1500 mm to 2600 mm annually with maximum temperatures of 38.5 C to 7 C in summers and winters. Flood occurs generally in the low lying areas of the district during May to August every year. Late flood during the later part of September & October also occurs. The occurrence of flood in the district is due to the river Brahmaputra and its Tributaries. The main rivers of the district are Brahmaputra, Puthimari, Bornoi, Nona, Kulsi, Pagladiya, Kalajal and Borolia. The total geographical area of the district is 434500 ha with 181608 ha of net area under cultivation and having forest area of 116694 ha. The main crops of Kamrup district are paddy, oilseeds, vegetables and other seasonal fruits like jackfruits and bananas. Table 1.1 District Land Area Latitude/ Popln in Literacy No. of Annual Area under Number Longitude Lakhs (2001 Development rainfall agricultural of (2001 census) Blocks use (ha) farmers census) 1420.51 20o9N to 1,504,320 55 % 6 Nos. 2120 210241 Small o sq.km 26 95N mm. Marginal and 91o45 o E to 92 22 Big E Total 2,43,113 3245 26.32N 1,642,420 61.65% 11 Nos. 310815 Small sq.km 91.0E 39532 Marginal 103047 Big 29230 Total 171809

Darrang

Barpeta

Kamrup 4938.22 25.46 N & (Rural + Sq.km 26.49 N & Metro90.48 E & Guwahati) 91.50 E

2,522,324

15 nos. 1500 mm to 2600 mm.

181608 Small Marginal Big Total

Vegetable production in Kamrup, Darrang & Barpeta Vegetable cropping is in two seasons: Kharif and Rabi. Rabi (mainly vegetables) is the spring harvest season, with crops sown September to November and extending up into February and March, with most productivity in areas that receive the north-east monsoon. The Kharif (mainly paddy) is the main cropping season in much of Kamrup, Darrang & Barpeta commencing in May-June with the south-west monsoon and extending into autumn (September to November). From the three districts Barpeta tops the vegetable production and coverage in terms of area. The most grown vegetable in all the three districts is cabbage, followed by cauliflower and tomato respectively. Production of brinjal has sharp variation in comparison to Barpeta and Kamrup & Darrang districts. The production in all three districts show decline in comparison to year 2005-06 to year 2007-08 which can be one of the reasons for price rise in the market of vegetable commodity. Other factors like number of rainy days can also be taken into consideration while assessing decline in production. Many of the farmers in Singimari expressed their worries on decline in production due to more frequent pest attacks and use of pesticides and chemical fertilizers to prevent diseases like blight which has deteriorated soil fertility over the years. Farmers in all the three districts expressed use of chemical fertilizers to be only option to prevent pest attacks as it gives faster results. Alternatives like bio-manures are low in use as they act slowly to prevent diseases and hampering productions. Other reasons affecting production can be reduction in coverage area for vegetable production due to fragmentation of land and farmers choosing to grow other crops. Comprehensive study needs to be carried out to assess factors affecting decline in vegetable production.

Table-1.2 Total vegetable production of year 2005-06, 2006-07 and 2007-08 (Production in Metric Ton) Distric t Bitte r gour d Brinj al Cabbag Caulif Okra Pea e ls ower Tomat o Carro t Radis h Cucu mber Total producti on

BARPETA 200708 200607 200506 Total 6333 5753 87358 1842 7292 4 18424 7292 882 19310 5232 4084 3268 157936

6333

5253

87358

882

18156

5232

4084

3068

156082

6333

5266

87337

36988 13156

1878

18526

10447

8287

6067

244634

1899 9

1627 262053 2

7383 2774 6 0

364 2

55992

2091 1

1645 5

1240 3

558652

DARRANG 200708 200607 200506 Total 3190 7695 17667 9774 6856 746 15196 4813 4336 2320 72593

3190

7695

17031

9774

6856

746

15196

4813

4336

2320

71957

3190

15375

27862

19533

6838

1477

30809

4798

4322

4260

118464

9570

3076 5

62560

3908 2055 1 0

296 9

61201

1442 4

1299 4

8900

263014

KAMRUP (R) 200708 1419 10140 13044 15383 8280 1728 13816 2587 7538 3245 77180

200607 200506 Total

1419

10140

13044

15383

8280

1728

13816

2177

7538

3245

76770

1419

10125

26266

15367

8267

1725

13792

2156

7537

3231

89885

4257

3040 5

52354

4613 2482 3 7

518 1

41424

6920

2261 3

9721

243835

(Source State Horticulture Mission, Guwahati)

Total vegetable production area Vegetable growing areas over the years has declined in all the three districts. Barpeta district tops the coverage area followed by Kamrup and Darrang. Barpeta has decline of 3829 & 3759 hectares and Darrang has decline of 3666 & 3631 hectares of land area in vegetable cultivation from the year 2005-06. District Kamrup has decline of 582 & 562 hectares of land area from year 2005-06 which is much lower then Barpeta and Kamrup. The decline in coverage is sharp which has resulted in low productions. Coverage of cabbage cultivation is most in Barpeta and Darrang districts followed cauliflower. Kamrup district tops in coverage of peas followed by cauliflower in terms of coverage. Table-5 Total vegetable growing area coverage of year 2005-06, 2006-07 and 2007-08 (Area in hectare) Distric t Bitte Brinj r al gour d Cabba Caulifl ge ower Okr a Pea s Tomat o Carro t Radis h Cucumb er Total productio n area

BARPETA 200708 200607 200506 720 403 4111 1230 496 1001 836 295 441 326 9859

720

403

4111

1230

496

1001

786

295

441

306

9789

730

404

4110

2470

895

2135

785

589

895

605

13618

Total 2170

1210

12332

4930

188 7

413 7

2407

1179

1777

1237

DARRANG 200708 200607 200506 378 591 833 672 557 786 621 238 456 238 5370

373

591

803

672

557

786

621

238

456

238

5335

373

1181

1605

1343

556

1555

1259

237

455

437

9001

Total 1124

2363

3241

2687

167 0

312 7

2501

713

1367

913

KAMRUP (R) 200708 200607 200506 Total 120 716 581 1059 630 2676 614 126 647 231 7400

120

716

581

1059

630

2676

614

106

647

231

7380

120

715

1170

1058

629

2675

613

105

647

230

7962

360

2147

2332

3176

188 9

802 7

1841

337

1941

692

(Source State Horticulture Mission, Guwahati)

Chapter 2
------------------------------------------------------------------------------------------------------------------------------Scope of the study The study is proposed to identify the existing production and demand supply channel, constraints & opportunities and other factors such as market infrastructures and institutional arrangements supporting vegetables production and its marketing focusing on the districts of Darrang, Barpeta and Kamrup in Assam. There are various ranges of vegetables produced in the region. The study is focused on the major vegetables that were produced during the particular study period. The study also aims to identify critical gaps in the sub sector chain and try to come out with possible intervention strategies to strengthen the existing gaps. The study also focuses more on the producers and the production system. Objectives Identify the primary actors in the vegetable sub sector and understand the roles & relationship and the market contracts. To track the route of the vegetable from the producer to the customer and analyze the variation in price through the various channels Identify various internal and external factors influencing the sub sector Identify the constraints in the value chain that hinders growth of the producers and critically analyze the opportunities Methodology of the study The study used the sub sector analysis by starting with value chain map to identify the key players and the different supply routes in the sector. At the producers and traders level, Information has been collected directly through preset questionnaire, one to one interview and focus group interactions. Structured one to one interviews were conducted in the case of the wholesalers and retailers due to the constraint of organizing focus group discussion. Secondary data were collected through various sources which include web searching and visiting secondary institutions.

Limitations Lack of substantial secondary data was clearly a limitation of the study. Existing data were mainly on agriculture production and data relating to the fresh vegetable production were seriously lacking.

Chapter 3
-----------------------------------------------------------------------------------------------------------------------------The Vegetable Subsector The subsector approach is a systems study to an economic activity, emphasizing on the interdependence of economic units, particularly those involved in the production and distribution process. Fresh vegetable that are served in every household comes through some processes involving transactions, linkages between each process or units and while the usual assessment of economic impact focus on mainly one units such as the producers and consumers, sub sector analysis covers traders, wholesalers , retailers and all the other important participants in the commodity sub systems. For the purpose of our study, we have taken the basket of common vegetables produced majorly in the state. These vegetables were identified from the feedbacks of different actors, from the field observation in the market and also from the secondary data sources. The study was also constrained by the lack of accurate data on each particular vegetable. The vegetable subsector in the three districts as shown in the table below. Production, wholesale trading and retailing are the four important functions identified in the chain. Each value chain has been described in the study. Table: Vegetable Sub sector representation
PRODUCTION

FARMERS GROW INDIVIDUALLY (KHARUPETIA, BARPETA)

Indirect MIDDLEMAN (directly purchases from the producers and sell to other middlemen)

PRODUCERS MARKET (Balugaon,Barpeta Road Market) TRANSIT MARKETS

TRADERS (directly purchase from the producers and sell to wholesale market)

PRODUCER CUM TRADER (some producers directly take their goods to wholesale market)

WHOLE SALE

Other main markets such as Dibrugarh, Dimapur,Cachar

TRANSIT MARKET (TRADERS SOLD TO OTHER WHOLESALERS)

RETAIL

MACKHOWA (main wholesale market in Guwahati Beltola,Dispur,

SMALL RESIDENTIAL

MARKET

PRODUCERS The production sector under the study revolves around the study done amongst farmers in Singimari under Sualkuchi Development Block of Kamrup district and Kharupetia under Dalgoan Development Block of Darrang district and farmers in Barpeta Road & Sarbhog in Barpeta district. All the farmers interviewed were small and marginal farmers having a land holding size from 5-30 bighas of land (One & half acres to 5 acres). The parameters kept for the study are as mentioned below: i) Types of vegetables produced, 2) Volume of production, 3) selling of produce, 4) Transportation of commodities, 5) Pricing of vegetables, 6) Wastage of vegetables, 7) Support institutions, 8) Use of chemical fertilizers, 9) Use of chemical fertilizers, 10) Labor.

Types of vegetables produced Farmers in all the three clusters produced vegetables on commercial lines which serve as mainstay of their income generation. While farmers in Kharupetia & Barpeta district grow vegetables throughout the year, farmers in Singimari grow vegetables only in Rabi season. Singimari cluster is famous for production of brinjals (eggplant) which is known as Bhola Bangna locally. In the Kharif season Singimari farmers grow paddy as the village is low lying resulting in water logging which is not conducive for vegetable cultivation. Apart from vegetables other commodities grown in the area are mustard, corianders & chilies.

Table 7 List of main vegetable produced by the farmers in the three district Name of district Darrang (Kharupetia) the Vegetable commodity Beans, Squash, Bitter gourd, Lemon, Ridged luffa (zika), Pumpkin Ridge gourd, White gourd, Ladyfinger, Pointed gourd, Cucumber Cabbage, Brinjal (Eggplant) Jute & paddy Cabbage, cauliflower , tomato, brinjal, Radish, carrot, Knolkol, cucumber, Ridge Gourd, Sponge Gourd, Snake Gourd, Assam Lemon, Bitter gourd, Bottle gourd, Pumpkin, Ladys finger, cowpea, Pointed gourd, squash, Potato Jute, paddy, oilseeds Brinjal (Eggplant), Cucumber, Radish , Coriander, tomato, cabbage & cauliflower Paddy, Mustard

Other commodities Barpeta

Other commodities Kamrup (Singimari) Other commodities

Volume of production The farmers in all the clusters were able to tell about quantum plucking they do on day to day or weekly basis but on most of the occasions they were not able to calculate what volume they grow in one season. In comparison farmers in Barpeta road & Kharupetia can make out their profit & loss from Singimari & Sarbhog farmers. In all three clusters farmers could only give rough estimates of production commodity wise in one season. Selling of produce Farmers at Barpeta and Kharupetia in Darrang district sell their produce in regulated market under Assam Agriculture Regulated Marketing Board with local and outside traders. Many farmers in Sarbhog and Singimari also sell their produce in open markets which are not under control of municipal town committees or Assam Agriculture Regulated Marketing Board. Most of the farmers in Singimari which is just at distance of 10 KM from Guwahati take their commodities directly to wholesale markets of Machkowa, Fancy Bazaar, Athgoan and Beltola based at Guwahati. Transportation of commodities Farmers generally carry vegetables to regulated markets in thelas, bullock carts to farm gate and open markets. Farmers at Singimari and Barpeta district hire trucks, Tata magic and 407 collectively to take commodities to wholesale markets in Guwahati and farm gate market at Barpeta Road respectively. In case of distress sale of commodities like tomato transportation becomes huge cost for farmers. Pricing of vegetables - Farmers in Singimari fix the price a bit arbitarily which is generally at higher side. No calculation on coverage of cost of production is kept by them before pricing the vegetables. While farmers in Barpeta and Kahrupeta keep calculations of cost of production inputs such as land preparation, purchase of seeds, fertilizers & manures, labor cost (generally own labor), cost fencing and sheds no such calculations are kept by farmers at Singimari & Sarbhog. Many Singimari farmers revealed that they have been just living at subsistence level as they just somehow manage breakeven from framing activity. Wastage of vegetables There were different reasons of wastage of vegetables as reported by farmers in all three clusters. Prominent reasons for wastage were over production of tomatoes in district of Barpeta, pest attacks in Singimari and Assam bandhs. Farmers never calculate quantum of waste they incur while transit of vegetables to wholesale markets and weekly haats. In event of bandhs most of the time farmers get the news before hand and they do not pluck vegetables for sale. Farmers in Singimari and Sarbhog never keep factors at mind such as losses incurred due to wastage, whereas farmers in clusters of Kharupetia and Barpeta kept such factors while making profit and loss calculation after selling commodities. Few of the farmers also reported some farmers committed suicide due to losses incurred by growing tomatoes due to over production and distress sale in district Barpeta.

Support institutions Based on interactions with farmers institutional support has been low from all corners in the three clusters under the study. Farmers lack introduction to new technologies and trainings on modern farming methods. Lack of adequate infrastructures like transportation and market sheds to support marketing of fresh vegetables are decapitated. Linkages with financial institutions for availing credit are poor as banks have not been actively providing credit. Many farmers in all three locations have been taking loans from moneylenders at higher rates of interest which is returned by them after the harvest. Farmers responded ASSAM GRAMEEN VIKAS BANK-AGVB has been instrumental in providing credit through KCC loans. Support from NGOs and voluntary institutions have been negligible in the area in facilitating market and other linkages and trainings on modern framing technologies amongst farmers. NGOs like SDCCC in Sipajhar under Darrang district have been instrumental in implementation of Assam Agriculture Competitiveness Project-AACP along with district line departments in Kharupetia and other parts of Darrang & Udalguri district. The project provides farm machineries and equipments to small and marginal farmers through subsidy. The NGO facilitates proper social scanning and forms Common Interest Groups-CIGs amongst farmers. It was found that in Singimari Cluster lacked irrigation facilities and consequently many farmers left framing to adopt other income generating vocations like weaving. You will give us what? Nothing if we would have talked to some government officer or some lawyer they would have taken 400-500 rupees from us. Nothing is possible here.) A framer in Singimari Cluster on being asked is there any possibilities of forming NGOs or farmers club to the study team An unwelcoming example can be drawn with example of poor institutional delivery mechanism can be from Singimari cluster, where a market shed and cold storage (3000 MT storage facilities) facilitated by ASSAM STATE AGRICULTURE REGULATORY MARKETING BOARD (ASARMB) lays idle since time of setting up of the infrastructures. Farmers reported vegetable productions are only in Rabi season and Singimari lies only at distance of 10 Km from Guwahati which is big market where productions are absorbed on daily basis. The market shed is misplaced as most of the commuters passing by like to take vegetables on roadside rather entering into the shed. Farmers expressed if government would have arranged trainings on modern framing methods and facilitated proper irrigation facilities it would have been of much benefit. Other inference can be drawn from district of Barpeta which has highest production and area coverage of vegetables. Barpeta district lacks proper warehousing and cold storage facilities to keep vegetables. Only a privately owned cold storage (2500 MT storage capacity) found at Sarbhog area in Barpeta district was operational storing potatoes, beets and eggs. A framer

from Mandia in Barpeta district revealed that tomatoes and potatoes result in distress sale or thrown away in river as clod storage facilities are negligible near vegetable production clusters. Nagrijuli, Lotibari and Parkijuli produces enough vegetables mainly potatoes and Kingdom Bhutan provides excellent trading opportunities to farmers here. But potatoes result in distress sale here due to absence of cold storage. Bapi Dey Sarkar, Vice President Lok Sewa Samity, Baksa district Note All the three locations mentioned in the comment are under Nagrijuli Development Block of Baksa district. The principal marketing yards (PMY) facilitated by the ASARMB are occupied by the armed forces and remain non-operational. Indian Army & CRPF occupies the PMY in (Kharupetia) Darrang and (Howly) Barpeta. It is tough affair for farmers transporting their agricultural commodities to these marketing yards as they are not placed near production areas. Scheme has been initiated by ASARMB which provides transport subsidies of 30% to farmers for carrying their commodities to these yards. A market shed in Khraupetia for sale of staples and other agricultural commodities covering 16 bighas of land has been raised by ASARMB. The shed has been effectively facilitating transactions between farmers and traders in fair environment. The ASARMB has been supporting the traders and farmers through issuing of trade licenses to traders and forming growers society amongst farmers. Farmers in Kharupetia also expressed for facilitation of better Infrastructures like to cold storages, processing centers and warehousing facilities. NABARD has been extending training facilities on modern farm management through NGOs/VOs in Barpeta & Kharupetia. In Singimari cluster NABARD has no presence. Development institutions like NABARD, KVKs & State Agriculture Department needs to do much more in disseminating information of framing technologies, facilitating infrastructures like cold storages, vegetable processing units and involve themselves, in-house management, staffs trainings and in market research. State Agriculture Department has been implementing various development initiatives for agriculture in Assam, but there has been very little impact visible. Data collection methods in regulated markets are not up to date as the study team never got any instant data from ASARMB in all three locations and its head office based in Guwahati. Confusion and chaos prevailed amongst officers whenever asked for any data both in State Agriculture Department & ASARMB. A classic case of official delay in executing development projects can be cited in district of Barpeta where under a government scheme meant for distribution of seeds could

reach to farmers through department after harvest season was over due to late arrival of seeds (as reported by DAO). Internal coordination amongst departments and banks needs to strengthen in providing credit schemes like KCC to small and marginal farmers. DAO, Barpeta expressed his unhappiness over not extending KCC loan to deserving farmers by bank officials. He informed the issue has been raised in monthly DDA meeting infornt of Barpeta district Deputy Commissioner wherein a framer referred by his department for credit was refused by bank and instead service holders were being provided loans of greater sizes. In many cases over financing units were also observed by DAO. Use of chemical fertilizers Use of chemical fertilizers in all three locations were visible. Farmers expressed use of chemical fertilizers and pesticides are inevitable as pest attacks are frequent and gestation period of vegetables gets delayed and vegetables are not able to hit the markets at time. Use of organic manure & pesticides was almost non-existent and unpopular preposition amongst farmers. When enquired about reasons for not using bio-fertilizers and pesticides farmers told that these are slow to react and does not promote proper growth of crops, this delays in late arrival of vegetables to markets and vegetables from outside flood the markets with their commodities. Cost of chemical fertilizers and pesticides increase cost of cultivation for farmers, which can be reduced through introduction of organic manures and effective pest management technologies. In Singimari cluster farmers are facing problems of low production due to over use of pesticides which is over the years reducing soil fertility. The alarming use of chemical fertilizes must be taken into account as neither farmers know the ill effects nor the end customer. Government and voluntary organizations need to play greater role to control such issues. Seeds Farmers used both hybrid and indigenous seeds for cultivation of vegetables. The use of hybrid seeds of vegetables was more prevalent in clusters of Kharupetia and district of Barpeta. Farmers in Singimari cluster used indigenous seeds for growing brinjals (Eggplant) and hybrid seeds for coriander and reddish and other Kharif season vegetables. Labor Most of the farmers used self labor in their fields as they were small and marginal. Bigger farmers hired outside labor for working in their fields. Cost of labor varied from Rs.150/to Rs.100/- in all the three clusters. WHOLESALER Traders involved in the wholesale sector are traders at farm gate market and in urban centre like Machkhowa market at based at Guwahati. One to one interviews were carried with these traders for purpose of the study. The traders at the farm gate market are regulated by the ASSAM STATE AGRICULTURE REGULATORY BOARD (ASARB) and traders in urban centers of

Guwahati, Barpeta & Darrang are regulated by municipal town committees. The main job of ASARB is to provide infrastructure support to traders and producers and establish a fair-play of transactions amongst farmers & traders. The Machkhowa wholesale market is one of the biggest markets based at Guwahati having 125 Nos. of wholesale traders. The Machkowa market is being controlled by trade Association which is under lease from Guwahati Municipal Corporation. The license is renewed every year to the trade union. Traders across districts of Barpeta, Darrang, Kamrup, RiverRhine areas of Brahmaputra and outside state like West Bengal & Meghalaya merge at the Machkhowa market to sell vegetable commodities. The wholesale market based in Darrang and Barpeta district is controlled by Municipal Committee which is leased to individuals on contract. The main job of these lease individuals is to maintain facilities, collect taxes and provide protection to traders under the market. There is large gap in prices from farmer to retail market; the vegetable sector is constrained by poor market infrastructure and availability of space. There are two main types of wholesale markets in the three sectors Rural periodic markets In rural areas these markets sit on daily, weekly and twice in week. Farmers sell their vegetable commodities directly to local wholesale traders and outside traders coming from urban centers like Guwahati. Assembly markets The size of the market is bigger than the rural haats and similar to farmers market. Here traders from different districts assemble, merge and transport vegetable for sale in cities throughout Assam. Traders in Barpeta road send vegetable commodities to traders at New Delhi through contracts. Here farmers produce is assembled for transport to a city market, with the payment to farmer through mutual bargain. The farmers also take beforehand knowledge on prices of commodities from bigger wholesale markets like Machkhowa. The wholesale sector needs infrastructural changes for efficient operations and professional handling of services. Proper placements of infrastructures with market research needs to carried out based on demand/supply. Infrastructures like cool storages, modern weighing machines and internet connectivity is must for connectivity. The ASARB must adopt legislative changes for greater transformation in terms of market regulation as many of its functions gets triangulated with town municipal committees and local Panchayat bodies. Price regulation does not exist on fresh market commodities at the regulated markets. The prices depend on one to bargain between farmers and traders. RETAILERS The retail sector is largely occupied by tiny individual vegetable sellers. The study carried was conducted five retail markets based Guwahati.

The names of the market are as mentioned below Beltola Bi-weekly market, Beltola evening market, Goat market, Kacharighat Market, Uzanbazar Market, Fatasil Market & Dispur Super market These retail markets are leased by Commissioner-GMC to individual contractors who are responsible upkeep and maintenance and collection of taxes from retail shop owners. The rate specified for setting up shops are in range of Rs.20/- per day. Other cost include Rs.20/- to Rs.100/- per day for carriage of vegetables from wholesale markets. The cost increases or decreases on volume of vegetable commodities brought to retail market. Most of the retailers procure vegetable from Machkhowa wholesale market, wholesale markets based in Meghalaya and other small vegetable growing clusters within Kamrup district itself. The retail markets are located in convenient location accessible to consumers. The retail sector has got potential of private investment which can boost inflow of technologies, improvements in infrastructures and quality vegetables to end consumers. Companies like Reliance fresh and food bazaar which have sizable presence in some other states are yet to make any investment in northeastern states.

Price Variation in the chain The study has attempted to draw the price variation within the various chains starting from the producers market to the retail market where the consumers finally get the vegetables. The prices listed below reported during the study period and does not remain fixed for all time

Table 3.3 Price Variation of vegetables (Month of August)

Vegetable name

Price at which traders procure from producers (Rs.)

Ridged luffa (zika)

Pointed gourd (potol) Beans White gourd (kumura) Rigde gourd (bhul) Brinjal Spiny bitter cucumber (bhat kerela)

Price at which wholesalers procure from traders (Rs.) Rs. 2500-2700 per quintal Rs. 29-30 per kg (Rs.25/- to Rs.27/- per Kg.) Rs. 1500-1800 per quintal Rs. 20 per kg (Rs.15/- to Rs.18/- Kg.) Rs. 1800 per quintal Rs. 20 per kg (Rs.18/- Kg.) Rs.2700-2800 per quintal Rs. 30-32 per kg (Rs.27/- to Rs.28/-) Rs. 1000-1500 per quintal Rs. 15 per kg (Rs.10/- to Rs.15/- Kg.) Rs. 2000 per quintal Rs. 22-27 per kg (Rs.20/- Kg) Rs. 1800-2000 per quintal Rs. 22-23 per kg (Rs.18/- to Rs.20/- Kg.)

Price at which retailers procure from wholesalers (Rs.) Rs.33 per kg

Price at which retailers sale to consumers (Rs.) Rs. 35-40 per kg Rs. 30 per kg Rs. 25 per kg Rs. 40 per kg Rs. 22-25 per kg Rs 35-.40 per kg Rs. 25-30 per kg

Rs. 22-25 per kg Rs. 22 per kg Rs.35 per kg Rs 18-20 per kg Rs. 30-32 per kg Rs. 24 per kg

Factors that immediately affect the price The price fixed at Machkhowa wholesale market affects the price at the producers market, not the other way round. When there is bandh in Guwahati, the price in the farm gate (producers market) goes down, as there will be fewer traders and more producers. Prices goes down during the season, because there will be more production, the traders will have more options to choose from many producers, this leads to the traders having more bargaining edge than the producers. Arrival of new season vegetables fetch more price and prices decline overtime as the season starts going off. Carriage cost is one of the major factors affecting price of vegetables depending upon the place. As vegetables are fast perishable commodities and the market doesnt have storage facilities, the producers have to sell off their goods at the earliest possible, as the price will be lower and also the wastage will be high. The price of vegetables goes high due to incessant rains which affects production. Low productions are not able to make up to market demand. Many areas in River-Rhine areas of

Brahmaputra where vegetables are grown get inundated by flood waters damaging vegetable and other crops grown in the area.

Factors affecting market supply/demand and the market contracts Seasonality Seasonality affects the supply/demand mechanisms as number of rainy days affects production because most of the agriculture in Assam is rain fed. Uneven pattern of rains (more or less) affects the cultivation process and results in deficit production in Kahrif season. In Rabi season suffer in many areas due to lack of irrigation facilities. Farmers having small land holding in NizGandhmow village under Sualkuchi Development Block of Kamrup district had left vegetable farming which use to be there mainstay of livelihood generation in want irrigation facilities. These farmers have switched over to weaving as alternate livelihood option. A drip irrigation system can be effective tool for revving the vegetable cultivation amongst the farmers with small landholding patterns.

Networks The networks are poor at all levels in the chain. The district agriculture office is implementing various schemes for the welfare of farmers but institutional delays result in poor support. Gram Sevaks operating in their respective areas need capacity building in understanding issues related to agriculture and felicitate development works initiated by Agriculture Department. The ASARMB has presence in all the regulated markets and work effectively. Infrastructures such as market shed are improving with intervention from ASAMRB. Kharupetia & Singimari have facilities such as market shed and cold storages. Proper placements of infrastructures are big concern as many of the infrastructures build are lying ideal due to improper placements. Institutional support to farmers from development institutions like NABARD/State Agriculture Department/NGOs/Banks needs to intensify their activities for making timely intervention. Banks need to identify proper farmers to support credit delivery through KCC and facilitate crop insurance schemes like RKBY. There was no presence of corporate investment at the farmer and retail sector as visible in other parts of the country. Infrastructure Poor arrangement of market infrastructure results in distress sales of commodities due to overproduction as there is less number of cold storages and market shed needs modernization. Transport facilities also need to modernize for facilitating carriage of goods. Communication systems need to be at place for weather forecasting and other critical issues related to framing. These market infrastructures have been facilitated by ASAMRB and town Municipal Corporation. Supplies of off-peak seasons vegetables can be maintained if number of chain

cold storages are increased. The number of market infrastructures in the region is as mentioned below Table 3.4 Details of Market infrastructure Sl.No Particulars Barpeta 1 Number of wholesale markets 2 Number of market shed 3 Number of cold storages 4 Number of Principal Marketing Yards 5 Number if terminal markets Information flow It was tough to make assessment of demand as there were no official data were available. The data in regard to export and import of vegetable commodities are not available. Records of commodity wise transactions were not recorded on daily basis on any of the markets. Many producers were also selling the commodities in informal open markets, like farmers in Sarbhog sell vegetables in Patilidah of Bongaigaon. Regulations Assam State Agriculture Marketing Regulatory Board ASAMRB is the main regulatory body regulating the markets in Assam. Besides ASAMRB most of the markets in Assam are controlled by Zila Parishad (Panchayat) and town municipal committees in urban areas. Most of the vegetable and other agricultural commodities are marketed under the regulated market but many commodities are also sold in small open markets. There exists a contravention between Acts of Zila Parishad (Panchayat Act), ASAMRB and Municipal Act which hinders commercialization of vegetable products on issues of establishments of market infrastructures. Assam Agricultural Marketing Regulatory Board Assam Agricultural Produce Market Act, 1972 has come in to force since 1977 the object as emphasized on the legislation has not yet succeeded fully. The main hindrance in attaining achievement is the conflict amongst the provisions of Assam Agricultural Produce Market Act. 1972, the Panchayat Act, 1994 and the Municipal Act on the matter of establishment of market. The Assam Agricultural Produce Market Act, 1972 prohibits the local authorities or other persons to markets popularly known as Numbers Kamrup Darrang

Haat, primary wholesale and secondary wholesale markets in the entire state of Assam. The provisions of the AAPM Act, 1972 have been amended time to time. The AAMRB is centered towards welfare of producers by helping farmers create and establish fair transactions with traders. The main job of AAMRB is to provide infrastructure support (Market shed, marketing yards, cold storages etc.), License to traders and take welfare measures for producers. Establishment of growers society & Provision of transport subsidies (30%) to farmers .Mismanagement are found in the Present System or traditional markets in method of sale, weighing, delivery, payment etc. and a wide difference of Producers rupee and consumers rupee is also found in the existing system of Agricultural Marketing. All these bottlenecks and constraints are the major factor of non-receiving the better price by the Producers. Hence, after due consideration of all these factors adverting the interest of Producers the Assam Agricultural Produce Market Act, 1972 is enforced in the State of Assam for providing better regulation of buying and selling of Agricultural Produces and establishment of Regulated Market in Assam. But due to some hindrances the aims and objects of the said Act has not achieved to that extract. The Assam State Agricultural Marketing Board has now therefore reviewed the entire progress of works under the Assam Agricultural Produce Market Act, 1972 and considers the present condition of Agricultural Marketing System in Assam it is decided to develop the marketing system under the Assam Agricultural Produce Market Act, 1972 by formulating a Five-Year Plan and through its execution within the stipulated period. AASRMB has taken several development initiatives for welfare of farmers and strengthening of marketing management. Recently AASRMB has initiated schemes for welfare of farmers like provision of transport subsidies and establishing transport subsidies. AASRMB has also initiated

establishment of infrastructures by increasing number of cold storages, market sheds and PMY and Sub-Yards. The AASRMB has been also putting efforts to maximize shifting of market transactions from existing traditional markets to regulated market yards. Panchayats The Panchayat Act regulating the wholesale markets are leased out to individuals. These individuals are responsible for providing maintenance of the infrastructures, collection of daily taxes from traders operating in market sheds and protecting & negotiating conflicts

amongst traders and farmers. The Act is not centered towards development of farmers or taking welfare measures for traders for establishing fare play of transactions. Town Municipal Corporations Town municipal corporations are responsible for maintenance of retail and wholesale markets in urban locations of all districts. The Town Municipal Committees lease out these markets to individuals and associations on lease agreements. The main job of the associations is to collect tax or cess from retailers, wholesalers and traders selling or bringing vegetable commodities to wholesale and retail market. In turn these bodies provide protection to the entire market, make arrangements for cleaning the market and upkeep the market. These bodies controlling the market pay monthly payment to municipal corporations from the earnings.

Chapter 4
---------------------------------------------------------------------------------------------------------------------------Opportunities & Constraints

Oppotunties Organic farming Widespread uses of chemical fertilizers have increased over the years amongst farmers for preventing pest attacks, increasing productions and hitting the market at the right time with the produce. Farmers in many pockets still do not know use of chemical fertilizers and use farm yard manures for cultivation. Proper training on organic farming amongst farmers provides immense opportunities for organic cultivation of vegetable on commercial lines. The farming must target on enhancement of productions, timely harvest of vegetables and reduce pest attacks. Organizing the production and retail sector Private investment can foster organic farming of fresh vegetables which can add value to farmers produce. The effort can also organize small and marginal farmers under one roof. Corporate investment can introduce modern technologies and investments can come up for improvements of infrastructures such as cold storages. But this can also reduce marketing options for the farmers by giving rise to contract farming which has to be taken in consideration. Technologies can track volume of production on each harvest season which can help to make assumptions on market local market requirements of vegetables and availability of vegetables for exports. Constarints Technology Technology has been one of key bottlenecks in promoting vegetable cultivation on commercial lines and developing market forces. At the farmer level lack of modern irrigation facilities, use of chemical fertilizers and pest management techniques hinders productivity. The problem needs to be addressed with disciplined approach by government and apex development institutions (NGOs/CBOs, NABARD/State Agriculture Department/PRIs) working in field of agriculture. It was observed during the study use of chemical fertilizers and pesticides were high in order to increase production and control pest attacks. Trainings need to be provided to farmers on precision application of bio-fertilizers and pesticides which can enhance productivity and preserve microbial content of soil and control pest attacks. Market forces must adopt modern technologies for adopting proper supply chain management approaches, planning and subsequent improvements. Suitable technologies can be procured from nabohgering state of West Bengal, which tops vegetable production in country. Adopt systems and supply chain management approaches to planning and improvement.

Increase developmental work for suitable varieties and productivity improvement under high temperatures. Foster uptake and improvement of low-cost structures and microirrigation systems. Reduce overuse of chemical fertilizers and enhance precision application through and use of bio-fertilizers. Reduce pest and disease losses while minimizing reliance on chemicals for pest and disease management by improving pest management practices.

Chapter 5
--------------------------------------------------------------------------------------------------------------------------Conclusion There is an established value chain in Kharupetia and Barpeta road vegetable sub sector while the regulatory authorities such as the ASRARB and Municipal Corporation are also visible in the interaction between at various levels. As the study was of a small scale and of limited scope, it could only observe the external influence such as tax collection, fixing of price limit in some cases. Further critical analysis is needed to identify to come up with more strategies to strengthen the role of the regulatory authorities. Commercialization of vegetable cultivation requires establishing markets and trading centers with adequate storage facilities close to production centers. There cannot be commerce unless there are markets. Without commerce value addition will not take place and low-incomes, poverty and unemployment would be the end result. Indeed the low productivity levels of irrigated agriculture in Assam seen earlier can be attributed to the absence of commercial opportunities that markets and trading centers would throw open. Regulated markets and trading centers with adequate storage facilities are needed to provide a space where the farmers, traders, and in a limited way even retail buyers can interact in the price discovery process. This is essential for farmers to respond to market signals. Markets and trading centers have to be close to the production centers. Else farmers being mostly unorganized would lose out to the relatively more organised traders, especially on account of transport costs. Faraway markets offer very little incentive for commercial production and in such a situation farmers would restrict their cultivation to meet their self-consumption needs. It is high time that the government and development planners recognize that markets, trading centres and storage facilities are complementary commercial infrastructure to irrigation facilities, which is a technical infrastructure, and should be developed along with irrigation facilities. The government should invest in developing regulated markets and trading centers with adequate storage facilities across the entire state. Developing such market centers in a short period should be fairly easy. The target should be to at least double the number of such markets in Assam over the next three years and to attain a level comparable to Punjab or Haryana within a decade. This would provide a far better incentive to farmers to adopt modern technologies essential for commercialization than using the same resources for providing subsidized fertilizer, irrigation and other farm inputs. The role of private sector must be recognized here. Private sector may be expected to play a major role in the development of ground water based irrigation systems as such systems typically allow full control to the private agent investing in them. On the other hand, major / medium irrigation projects have many of the characteristics of public goods, and hence would

not attract private investments. It is then primarily the responsibility of the government to develop such major / medium irrigation systems. Similarly, the private sector is unlikely to take initiative in developing general-purpose agricultural markets and marketing yards, though some narrow private channels of trade might emerge over time. Here too, the initiative has to come primarily from the government.

For development of irrigation, the following actions are needed: Ground water irrigation shallow tubewells with appropriate institutional structures. Surface water irrigation for promoting the geographic spread of rabi season and for flood control. Marketing and storage facilities. Attain the level in West Bengal within a decade. The ultimate objective should be to have a regulated market / trading centre with storage facilities close to every village (say within 20 to 25 km so that a farmer can make a same-day round-trip to the market to sell his produce).

It is also becoming increasingly difficult for the small vegetable producers to remain competitive in the economic systems without overall assistance.

ANNEXURES Table : Tools used with respondents details Type of Place Names of respondents methodology FGDs with Bihudia, Khokjani in Md.Zulfikar Ali, Md.Abu Bakar, farmers & Sri Diganta Baishya, Kharupetia, Darrang traders Sri Harmohan Basihya, Niz-Gandhmow, Sri Kanak Baishya, Sri Naba Singimari, Kamrup Bharali, Sri Sanjay Das, Sri Ramen Das Md.Sarafat Ali, Md.Mafizul Barpeta Road, Barpeta Islam, Md.Saiful Islam Interviews AAMRB Head Office, Sri Hemendra Kr.Deka, MI Balugaon, Kharupetia (AAMRB) Balugaon market, Md.Rakib, Tax Collector, Kharupetia market, Balugaon market Darrang AAMRB Head Office, Sri Jatin Sarma, MO (AAMRB) R.K. Mission Road, Guwahati Barpeta District Agriculture Sri Samir Chakraborty, DAO Office, Barpeta town, Barpeta Sipajhar Diamond Club Sri Bhupen Nath CEO-MF, Community Centre, SDCCC Sipajhar, Barpeta Jyoti Social Society, Sri Narayan Goswami, Sarbhog, Barpeta Secretary Sarbhog, Barpeta Sri Bhabin Ch. Roy, Vegetable farmer Sarbhog, Barpeta Sri , Vegetable farmer Mandia, Barpeta Sri Shubash Pal, Vegetable farmer (Potato) Sarbhog, Barpeta Sri Nakul Pal , Cold Storage owner Singimari, Kamrup Sri Haren Barman, Village headman(Gaonbura), Singimari Sualkuchi, Kamrup Sri Nayan Kakoti, RGVN Assam State Agriculture Sri Saikia, Assam State Date No. of respondents 24/06/2010 12 Nos. 22/06/2010 6 Nos.

24/06/2010

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24/06/2010

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Department, Khanapara, Guwahati Retailers at Guwahati

Agriculture Department, Khanapara --

Annexure 2. State-wise area of vegetables for India 1999/00 to 2002/03