Transcript WUWM 2012 - COSAMB | National Council of State

Structural and Functional
Peculiarities of Wholesale
Markets in India
J.S Yadav
C.E.O.
Premium Farm Fresh Produce Ltd.
New Delhi, India
Key Facts
• Green Revolution (1967-1978) transformed India from
a food deficient to a surplus food market.
• In a span of 3 decades, India established itself as a net
exporter of food grains.
• India is the largest producer for milk, cashew nuts,
coconuts, tea, ginger, turmeric and black pepper.
• 2nd
largest
producer
of
wheat,
rice,
sugar, groundnut and inland fish. Third largest
producer of tobacco.
• India is home to 10 % of the world fruit production
(775.25 lakh MT) with first rank in the production of
fruits like Banana and Sapota while it ranks 2nd in
terms of vegetable production (1,496.07 lakh MT).
Commodity Basket
• Top 10 markets of the country in terms of Arrivals,
handle 74% of total throughput of F & V of all the
markets – shows strong interdependency
• Top 10 F & V account for 80% of the total arrival in a
market.
 Top 5 Fruits constitute : Apple, Mango, Banana, Citrus fruits, Guava
 Top 5 Vegetables: Onion, Potato, Tomato, Brinjal, Cabbage/ Cauliflower
• On the basis of production, the top 5 fruits constitute
of 75% of the total fruit production and the top 5
vegetables constitute 60% of the total vegetable
production. (Source: Country Level Action Plan)
Population Served by the Markets
(Source: Country Level Action Plan)
STRUCTURAL Dynamics of
Traders’ Profile
Population of
City (in million)
No. of Cities
No. of
Markets
No. of
Traders
No. of
Traders per
Market
No. of
Traders per
City
0.5-1.0
32
43
14378
334
449
1.0-2.0
9
16
10740
671
1193
2.0 & above
7
44
16350
372
2336
Total
48
103
41468
Avg. = 459
Avg. = 1326
 There are 1/3rd (33%) of
the cities where 50 % traders are without
premises.
 66% cities offer less than 40 sqm for average shop area (including
display, sorting and cleaning, office and storage etc)to traders.
 In 75% cities traders are operating with inadequate shop area.
(Source: Country Level Action Plan)
Transport Utilization Pattern
 29% of the total cities (16) witness more than 1000
vehicles entering the market on a normal day.
 The share of medium trucks (10 tonne) in total vehicular
entries is less than 10% in majority of the cities.
 Only in 8% of the cities (4), large trucks (10MT) dominate
with a share of more than 50% of total vehicular traffic.
 82% of the trucks operate in seven big cities of first
category.
 The ratio between outgoing and incoming vehicles is 1:4
and 1:5
(Source: Country Level Action Plan)
Existence of Commission Agents in
Indian Agricultural Marketing
 Out of the total shops, majority of them are owned by
Commission Agents.
 All Auction Sheds are allotted to Commission Agents
with no rentals (free of cost).
 Commission Agent is the highest gainer (8-10%) in
the entire supply chain with least contribution to
value addition.
Mark-ups in Agricultural
Value Chain
25-30%
8-10%
8-10%
15-20%
25-30%
100%
Aggregator/
Iterant Merchant
Primary,Secondary,Tertiary/Transit Markets
9/6 Fold Classification
Source: Study by PFFPL
Alternative Roles of CA
In a study by PFFPL, conducted in 61 markets of 8 states in the country,
where the sample size of 310 farmers and 305 traders was selected,
perception regarding essential alternative roles of CAs was taken.
Alternative Roles
Farmers
Traders
Give credit Facilities without interest
52%
56%
Give credit Facilities with interest
33%
39%
Supply of inputs especially seeds.
37%
18%
Provide market information
72%
94%
Immediate cash payment
92%
89%
If the commission agents are prohibited, there is a question as
to who will provide credit and who will risk lending of money
without any co- lateral guarantee.
Source: Study by PFFPL
Differentiating Facts About Market
Operators
• There are more than 7000 wholesale markets
managed by APMCs.
• India is a country where Auctions are compulsory.
• Market Fee @ 1% (average) is levied for every
transaction (ad valorem) and retained by market
operators.
• Market operators (APMCs) are not allowed to
participate in buying and selling.
Current Status of Market Infrastructure in
apmc markets
The National Horticulture Mission, India has provided a list of Market, NonMarket and Essential Services which can be considered as a benchmark for
Pvt Markets, but current status of facilities in APMC Markets is as under:
Category of Services
Availability Status in Markets
Market Services
29.17 %
Non-market Services
25.45 %
Essential Services
52.86 %
Avg of total facilities
33.33 %
Most of the markets are old, to suit conditions very different from those of the
present day.
•
Towns are growing at a rate of more than 5% per year leading to a doubling of
urban population within few years.
•
Shifting of trade from old to new market is a gigantic task and takes around 5-6
years (hence always an apprehension of under-utilization) (Source: Premium Study)
•
Return on Investment calculated for
Services available in Wholesale Markets
Kind of Service
Avg. ROI
Market Services
-0.143
Non-market Services
0.924
Essential Services
-0.524
Average
0.085
To make the project viable and sustainable, the government is
providing subsidies for the private investors so as to encourage
them for investment in the sector
(Source: Premium Study)
Market-wise Top 5
facilities/services with high ROI
First
Azadpur
Nashik
Kolar
Hassan
Belgaum
Manual
carriage of
produce
Shopping
complex
Second
Third
Fourth
Fifth
Parking facility Plastic crates Restaurants
or
refreshments
Input shops
Restaurants
Banking
or
service
refreshments
Plastic crates Input shops
Restaurants
Porter service
or
refreshments
Restaurants
Logistic or
Catering
Shopping
or
transporters
service
complex
refreshments shops
Restaurants
Input shops
Shopping
Porter service
or
complex
refreshments
Banking
service
Porter
service
Toilets
Porter
service
Banking
service
(Source: Premium Study)
HIGH DEGREE OF INTERDEPENDENCY BETWEEN MARKETS (SELECTED 19)
DEPENDENT UPON
(Name of Market)
NAME OF THE MARKET
Ahemdabad
Mehsana
Nashik
Nashik
Bhavnagar
Amritsar
Jaipur,Amritsar,Azadpur
Nashik
Amritsar
Nashik
Vadodara
Nashik
Amritsar
Bhavnagar
Mysore,Belgaum
Mehsana
Nashik
Kolar,Bangalore
Jaipur,Amritsar
Nashik
Mumbai(Vashi Market)
Bhavnagar
Rajkot
Belgaum
Kolar
Bhavnagar
Ahemdabad
Jaipur
Ahemdabad
Nashik
Jaipur(Chomu)
Jaipur
Ahemdabad
Nashik
Chandigarh,Amritsar,Jaipur
Kolar,Hassan,Mysore,Belgaum
Hassan
Ahemdabad,Mehsana,Vadodara,
Surat,Bhavnagar,Rajkot
Nashik
Jaipur
Nashik
Hassan
Nashik
Nashik
Belgaum
Nashik,Pune
Nashik
Hassan
For Commodity
Pomegranate
Onion
Onion
Potato
Tomato
Tomato
Potato
Onion (Nashik Red)
Onion (Nashik White/Peela)
Onion(Nashik white/Peela)
Onion (Nasik red)
Onion
Onion
Potato
Tomato
Tomato
Tomato
Onion(Nashik Red)
Onion(Nashik White/Peela)
Onion
Onion
Onion
Tomato
Tomato
Tomato
Pea
Mango
Onion
Potato
Potato
Tomato
Potato
Tomato
Tomato
Tomato
Tomato
Onion(Nashik Yellow)
Cabbage
Cabbage
Onion
Onion
Potato
Season
May-Dec
Jan-Mar
Nov-feb
May-June
June-Oct
Nov-Jan
Nov-Mar
June-Oct
May-Oct
Nov-Mar
June-july
Aug-Nov
Mar-May
Apr-June
May-June
May-June
Jan-Mar
Sept-oct
Jan-Apr
Jan-Feb
June-sept
Jan-Mar
Sept-Dec
mar-May
Jan-Mar
May-June
Sept-May
Oct-Dec
Aug-Nov
June-Nov
May-Dec
May-Dec
july-Nov
july-Nov
mar-Apr
Mar-May
Oct-May
Sept-dec
Volume
Interdependency
100%strong
80%strong
50%strong
100%strong
100%strong
strong
300-400 ton/day
strong
80 ton/day
strong
60-70%
90%strong
strong
80-90%
100%strong
20%weak
weak
500-600 Qtl./day
70%strong
70%strong
30%medium
strong
50 ton/day (56%)
strong
150-200ton/day
60%strong
15%weak
5%weak
20%weak
10%weak
weak
15-20%
weak
Not Specific
10%weak
weak
10-15%
40%medium
12%weak
30%medium
15%weak
22%medium
80%strong
20%weak
90% strong
10%weak
65%strong
15%weak
5%weak
40%medium
70%strong
30%medium
Commodity Specific Important Markets in Country
(on the basis of Arrival and Dispatch)
S. No.
1.
2.
3.
Name of Commodity
Onion
Tomato
Potato
Name of Market
Duration
Nashik
May-Oct, Nov-Mar
Bhavnagar
June-july
Jaipur
Apr-Oct
Belgaum
Aug-Sept
Nashik
July-Nov
Amritsar
Apr-Jun
Jaipur
May-June
Chandigarh
June-Nov
Kolar
June-Nov
Amritsar
Nov-Jan
Chandigarh
Nov-Jan
Hassan
Sept-Dec
Ahmedabad, Mehsana
Mar-May
Potential Markets for Fruits
Apple: Chandigarh (dispatch to seven markets)
Banana: Surat,Vadodara (production & arrival round the year)
Pomegranate: Nashik (arrival and dispatch)
Mango: Krishnagiri (Production, dispatch to 7 markets), Bombay, Gujarat(Saurashtra)
Grapes: Nashik, Theni (arrival throughout year)
(Source: Premium Study)
FAO – RECOMMENDATIONS ON LAND USE
PATTERN FOR F&V WHOLESALE MARKET
S.No.
Particulars
General pedestrian circulation, such as
1
main walkways
2
Parking Area
3
Covered space for Marketing Activities
other Administration uses including
4
drain reserves
Source: FAO Planning and Designing Manual
% of Total Area
10%.
50-60%
25-33%
10-20%
COMPARISON OF MARKETS VIS-A- VIS FAO STANDARDS
(Source: Premium Study)
Parameters
Bangalore
Azadpur
Jaipur
Hyderabad
Gwailor
Pune
Safal
FAO
Standards
Sales area as
percentage of tot. area
21.54%
18.45%
14.62%
12%
2%
NA
5%
25-33%
21.18 sqm
30.76
sqm
109.59
sqm
NA
NA
NA
27.45
sqm
100.sqm
Tot. Parking &
Circulation as a
percentage of total
area
16.34%
21%
NA
62%
15%
50%
NA
60%
Water consumption
per meter square of
tot. area per day
0.31 lts
1.75 lts
0.018
lts
NA
NA
NA
0.89 lts
4 lts
Produce handled per
meter square per
annum of sales area in
MT’s
33.23
186.76
5.24
33.33
17.88
NA
5.25
10 to 25 MT’s
Area covered by
buildings as a
percentage of tot. area
NA
19.8%
NA
13%
3%
NA
NA
20 to 30%
Area under other
reserves as a
percentage of tot. area
NA
NA
NA
NA
NA
8%
NA
10 to 20%
No. of toilets per 100
persons
NA
NA
NA
NA
NA
NA
36
4
Per trader area
allotted
AVERAGES FOR VARIOUS PARAMETERS
Parameters
Avg.of different
markets
FAO Standards
Sales area as percentage of tot. area
12.2%
25-33%
Per trade area allotted
47.25 sqm
100.sqm
Parking & Circulation as a percentage of tot. area
32.87%
65%
Water consumption per meter square of tot. area
per day
0.74 lts
4 lts
Produce handled in MT/ sqm per annum.
21.57Mts
10 MT’s
(Source: Premium Study)
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