Marketing of Cotton

Cotton is an important cash crop providing raw material to textile industry. There are many other uses of cotton. Marketing of Cotton is open type in the Country except in Maharashtra, where there is State Monopoly Purchase. There is also a Semi-Govt. agency operating in cotton marketing alongwith private traders. The important states growing cotton are Gujarat, Maharashtra, Andhra Pradesh, Karnataka, etc. The result of study of cotton marketing in Andhra Pradesh are summarized here.

1. Channels: Following seven channels of marketing were identified.

Channel I – Producer – Commission Agent – Consumer.
Channel II – Producer – Village Merchant – Commission Agent Consumer.
Channel III – Producer – Trader – Miller –Consumer.
Channel IV – Producer – Trader – CCI- Miller – Consumer.
Channel V – Producer – CCI – Miller – Consumer
Channel VI – Producer – Miller – Consumer.
Channel VII – Producer – Village Merchant – Miller –Consumer.

Thus five intermediaries viz. Village merchant, traders, commission agent, CCI ( Cotton Corporation of India) and Miller are operating in cotton marketing in different channels.

2. Market Costs : Marketing costs incurred by different agencies/functionaries channelwise are given below in Table 1.

It is seen that, on an average, the total marketing cost was at Rs.52.75 per quintal. Among various components, transportation cost was the highest (Rs. 28.00) followed by commission (Rs.14.00) and the market fee (Rs. 11.82)

3. Producer’s Share: Producer’s Share in consumer’s price is the measure of marketing efficiency. The Producer’s Shares are given in Table 2.

Channels I to IV were commonly used by the majority of cotton growers and producer’s shares were 85 to 87%. In Channel IV, although CCI was involved, the produce was sold to it by traders and not be farmers. Therefore, producer’s share in this channel was quite low. But in channel V, producer’s delivered their cotton directly to CCI and hence they got the highest price and also the highest share. In channel VI, since the producers supplied their cotton directly to the Miller eliminating the intermediaries, they got better price and greater share. CCI is a Public Corporation established for the benefit of farmers. Therefore, selling cotton to CCI directly is definitely beneficial to cotton growers.

Marketing of Coconut

I. Tender Nuts (Maharashtra)

1. Coconut is one of the important plantation crops in India. It is mainly in Kerala, Karnataka, Tamil Nadu, Coastal Andhra Pradesh, Coastal Orissa, Coastal Maharashtra (Konkan), etc. Coconut is harvested as matured nut as well as tender nut (shahali) for water in it. Main produce is the matured nut for its copra production for many commercial uses including coconut oil. Tender nuts have also become very popular in town and city for the water content in it. Coconut water has become digestive properties as well as medicinal value. Production and marketing tender nuts has become a commercial activity. In Maharashtra, coconut is grown in coastal part of Thane district is very near to the Mumbai city. A field survey in this district indicated that of the total production, 70% is harvested as tender nut and 30% as matured nuts. In the case of matured nuts, 34% were consumed at home while 66% were sold (marketed surplus). On the other hand, in the case of tender nuts, only 5% were consumed at home and 95% were sold. This revealed that there is very high proportion of marked surplus in tender nut. 

2. Marketing channels: Following four channels of marketing tender nuts were identified.

1. Producer – co-operative society – wholesaler – retailer – consumer
2. Producer – co-operative society –retailer – consumer
3. Producer – retailer – consumer
4. Producer – wholesaler – retailer – consumer

3. Price Spread: Market costs margins and price spread under four channels are given in table below: -

The producer’s share was more in channels II & I where co-operative society was one of the agencies. But the share was maximum in Channel II (62.5%) where wholesaler was eliminated and the co-operative society sold nuts directly to the retailer. 

II. Matured Nuts: (Tamil Nadu)

1. Season: Main marketing season is in the months of March, April and May when 50 – 55% nuts are marketed. In fact, every after two months, new flower flushes are given out and hence some nuts are available for marketing throughout the year. But the period from March to May is the main season.
2. Agencies and Channels: There are three main agencies involved in the marketing of nuts.

1. local or village trader
2. commission agent – cum – wholesaler
3. Retailer

Local trader is the most important agency or intermediary through whom 73 to 98 per cent nuts in different villages pass. The next is the wholesaler through whom 20 to 26 per cent nuts are marketed. The commission agents only act as contact person between producers and other agencies. But very little produce is sold through the commission agents. The reasons for selling nuts through a particular agency are as under: -

Thus, first four reasons are the most important for choosing a particular agency for selling nuts.

1. Storage: The nuts harvested during the peak season are subjected to a maximum storage period of 2-3 months. There was increase in the value or sale-price due to storage to the extent of 37 to 45 per cent. The storage of nuts during glut season has two advantages.

1. Creation of time utility.

2. Creation of form utility.

The storage of nuts enhances the quality of nuts for oil purposes, thus increasing their sale value. The practice of storing nuts was more common among large producers who had larger quantities of nuts. The cost of storage was about 21 to 24 per cent.

Following were the reasons for not storing the nuts by other farmers.

Thus, first four reasons are very pertinent for non-storage of nuts particularly by the small farmers who have small produce to sell.