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Price of Beans in Chennai is Rs 70-80 /per kg , how & Why ?
A typical farmer has 1/2 acre to 1.5 Acres , he generally works from sunrise to sunset, Typically his family members attend to the related activity of the farm from morning to evening.
At the time of harvest , the farmer is totally dependent on a broker /agent who visits his farm and decides the price.
Reasons generally given by the agents are
Which the farmer has no way of verifying. Also the farmer has no capacity to verify prices or confront the middlemen.
Farmer cannot retain the produce overnight , as the produce looses its freshness.
Majority farmers have no capacity to go to the nearby mandi ( same situation at mandi too ,where farmer cannot decide his price ) , Even if he goes to mandi there is no tangible benefit, having carried his stock ,farmer is left with no option except to sell at prevailing price.
Example of Cost of Beans
One Kg of Beans produced by the farmer fetches him only Rs 10 , whereas we customers end up paying Rs 70-80 by and large. Selling for Rs 10 will incur a loss for Farmer , but what choice does he have ?
This is example of one produce.
Why farmers never make money ?
There is no central accounting /audit by any agency to advice or monitor number of acreage of a particular produce and production schedule. hence due to herd mentality either everybody produces at one time or very few does that product. Resulting in farmers always at a disadvantage.
Its the middle men, coordinators ,make hay weather its is over production or less production, both farmers and end user never get the real benefit.
how middle men make the most ?
As farmers are never given the knowledge of market reality , or total produce /consumption of the region. Middle men make the most.
Farmers are at a difficulty as there is no option for storage. Storage is not at all available nearby. Once the harvest is done its a uphill task for farmer to sell it as quickly as possible. Even if storage is available its not possible to store majority vegetables for more than a week or two.
There is always a risk to farmer, that he will not get any money for his produce once the freshness is lost. Apart from these vagaries of weather ,govt policy like bandh /lockdown /strike everything only affects the farmer and no other person in the chain.
Farmers have to sell it to middlemen or lose everything.
How does end customer end up paying always more ?
Customer are at the mercy of availability and proximity. this enables retailers to exploit.
Is there a solution or midway ?
There is no immediate solution unless govt pitches in with a draft policy. we TFA agri like few others have created a midway by reducing the numbers of people involved in the chain.By getting it from the farmer and directly supplying you.
However the outlay for this involves ,software ,hardware applications , man power ,logistics with freshness. hence if the quantity of customers increase the benefit will be for everybody as the end cost will come down with quantity.
Even now TFA and others going to farmers they get better price and customers get a better deal. As we reduce the number of people in the chain.
TFA Agri is also involved in farming in over 15 acres in Hosur /Kookalthurai thus enables other farmers aggregation.