National conference on ‘Agriculture Marketing’ – Nov 12 - 14

Innovations in Agriculture produce marketing – Experience of S.E.R.P

T. VIJAY KUMAR, I.A.S,C.E.O, Society for Elimination of Rural Poverty

Dept. of Rural Development, Govt. of A.Pvjthallam@gmail.com

12-11-09

Vision of A.P: each family in the state should be out of poverty, and, enjoy:-

Life with dignity, ‘voice’Intra family equity – equal status for womenFreedom from hungerDecent Income: >Rs.5000 per month, 3 - 4 sourcesPlanned household expenditureRisk management - life, health, assets and incomesShelter, Health and Education

Mandal Samakhyas and V.Os plan and implement the various

project components

– Each Mandal is divided into three Clusters of 10-12 habitations.

– A development professional, called Community Coordinator (CC) is placed in each Cluster. S/he stays in her cluster.

– SERP selects and trains them. After completion of training, theyare contracted by the MS and are accountable to MS.

– M.S responsible for social mobilisation, institution building and funding the microplans of S.H.Gs/V.Os from C.I.F

– Micro credit plans are evolved by the S.H.Gs in each village. These plans are funded by their own savings, CIF fund and Bank Linkage.

– V.Os responsible for appraising the microplans and recommending them to M.S for financing from C.I.F

– V.Os appraise microplans and also finance them from the recycled C.I.F

C.B.Os implement the projectA.P Federation Model

SHGs

•Thrift and credit activities

•Monitoring group performance

•Micro Credit Planning•Household inv plans

• E.C - 2 from each S.H.G, 5 Office bearers

• Strengthening of SHGs

• Arrange line of credit to the SHGs

• Social action

• Village development

• Marketing and food security

• Support activists – 3 -5

• E.C - 2 from each V.O, 5 Office bearers

• Support to VOs

• Secure linkage with Govt. Depts.

fin institutions, markets

• Auditing of the groups

• Micro Finance functions

SHGs SHGs SHGsSHGs SHGs

V.O

150 -200

MMS6000 9000 -

Z S300,000500,000

Village Organization

Mandal Samakhya

Zilla Samakhya

SELF HELP GROUPS

Key impacts of social mobilisationInstitution building

– 10.2 million women organised into 850,000 S.H.Gs,

– Universal coverage of poor - 90% of rural poor households organized

– All Villages covered

– S.H.G Federations: village – 35,525 V.Os,mandal – 1098 M.M.S, and, district – 22 Z.Ss

Social capital created

– 17,00,000 trained grassroots women leaders managing S.H.Gs and federations

– 180,000 para professionals at village level –accountable to women’s groups

– 20,000 Community resource persons – scaling up and deepening social mobilisation

Micro finance : SHG-Bank linkage

– S.H.G’s own accumulated savings and corpusRs.3150 cr

– Bank loans to S.H.Gs –Rs.6967 cr in 2008/09 : almost 50% of the entire country

– Per capita S.H.G-bank linkage – Rs.142,500 per group

– Cumulative lending from banks: 2004-09:Rs.19200 cr

Key livelihoods: Sustainable agriculture initiative

– Low external input sustainable agriculture – based on local natural resources (‘Zero budget farming’)

– covering 14 lakh acres in 2008 - 09 – largest initiative in the country

– Community managed extension system

– Cost savings: Rs.3000 – Rs.15000 per acre

– Seen as a national model for sustainable agriculture in the context of adaptation to climate change and mitigation

– Kharif 2009 – 20 lakh acres coverage (10% of State’s cultivable area)

Key livelihoods impactsCollective marketing of agriculture produce

− Village level procurement centres for paddy, maize, red gram, soybean, etc

− V.O as franchisee of A.P.State Civil Supplies Corporation for procurement of paddy at minimum support price

Women dairies: franchisees of A.P State Coop dairy − 156 Bulk milk cooling centres run by Mandal samakhyas− 2784 village milk collection centres− 250,000 litres of milk per day (flush season) − 140,000 dairy farmers

Risk mitigation

Social risk management

– 81 lakh members/spouses covered under life insurance

– largest in the country

– Front end managed by the S.H.Gs federations

– Low admin costs: Rs.10/ per member

– Target for 2009-10: 1.7 crores

Food security credit – covers 2.1 million families. Specific focus on tribal areas, coastal areas, and drought prone areas

• Agriculture the most important livelihood for the poor.

• Hence S.E.R.P’s focus on agriculture – making it ‘profitable’for the poor – small and marginal farmers, tenants

• Agriculture as a key growth engine for the rural areas

S.E.R.P strategy:

– Community managed– End – to – end solutions for small

and marginal farmers– Value chain analysis – inputs,

production, outputs, value addition and marketing

Community managed sustainable agriculture:

• Management by women’s organizations• “Decentralized extension system”,

accountable to grassroots women’s organizations

• Positively exploiting locally available natural resources – ‘zero’ external, chemical inputs

• Promoting Bio-diversity• Poly cropping - integrating household level

food and nutritional security

Key elements

• Unique collaboration – organizations of women, farmers, N.G.Os, and Govt.

• Knowledge providers – practising farmers, eminent farmer – scientists ( from across the country), N.G.Os, eminent agriculture scientists (a few)

• Dynamic knowledge sharing – continuous R&D • Intervention priorities decided by farmers,

not by us• Community Resource Person (CRPs) –

scaling-up “by” the community

Journey so far

0

500000

1000000

1500000

2000000

2500000

2005-06 2006-07 2007-08 2008-09 2009-10

Year

Number of FarmersArea (in acres)

10% of State’s cultivable area under eco-agriculture

14

Marketing agriculture and forest produce in S.E.R.P

Women Intervention in Marketing

• Marketing by women’s organisations

• Marketing Facility at the door steps of farmers

• To train farmers on quality and grading

• To enable farmers to obtain the best prices

• To eliminate exploitation in weighment and pricing by local traders.

Marketing strategies adopted by S.E.R.P :

1.MSP – franchisee of civil supplies corporation

2.Marketing to other V.Os and Samakhyas

3.Marketing tie-up with corporates

4.Marketing to wholesalers

Marketing Interventions by VOs during 2005-06 to 2009-10

S. No Year No .of

DistrictsNo.ofVO's

Quantity in

LakhTons

Value inCrores farmers

1 2005-06 18 2010 2.5 142 2.6 lakhs

2 2006-07 18 783 2.1 126 1.0 lakh

3 2007-08 21 2065 4.7 320 3.0 lakhs

4 2008-09 21 1704 5.9 492 2.2 lakhs

5

2009-10 (upto 21 1149 6.3 586 2.3 lakhs

27.10.09)

Major Commodities Handled

S.No Commodity

1 Paddy2 Maize3 Redgram4 Soybean5 Turmeric Seed6 Cashew7 Lac8 Neem9 Tamarind

10 NTFPs ( forest produce)

Road Ahead – 2014/15

• Horizontal expansion and deepening of the sustainable agriculture program.

–1.0 crore acres (40% of A.P’s cultivable area) under chemical pesticide free farming,

–50 lakhs acres ( 20%) – natural eco - farming – organic produce

Road Map Ahead……

• 6000 procurement centers(1000 centers in Tribal areas to Cover all villages) in the State next 5 years.

• Provide adequate village level infrastructure – storage, drying, grading, packing

• Village level value addition activities

Marketing strategies

1. MSP operations – price assurance to farmers2. Marketing tie ups with rural and urban samakhyas

for their food security and as resellers3. Retail chain in every town to sell pesticide free

and organic produce4. Market linkages with wholesalers, corporates,

exporters, processors, etc for pesticide free and organic produce

Issues to be addressed:

1. Suitable grassroots organisations for marketing –V.Os, farmers cooperatives, producer companies???

2. De – risking farmers from price uncertainities –instruments

3. Insurance against crop failure4. Market intelligence service to farmers, V.Os5. Local value addition – grading, sorting,

processing, retail packing, 6. Premiums for pesticide free/ organic produce

Issues

7.Standardization and codification of agriculture produce

8. Role of I.T – web based trading for the internal markets

10. Tying up with corporates marketing organic produce

11. Promoting a consumer movement for pesticide free/ organic produce

Issues : scaling up

How to operationalise the 5 year agriculture production cum marketing roadmap: – involving 40 lakhs members cultivating

1.0 crore acres of pesticide free crops and 50 lakh acres of organic produce

– Turnover – Rs.20,000 crores –Rs.50,000 crores ???