KARNATAKA LINGAYAT EDUCATION SOCIETY`S JAGADGURU TONTADARYA COLLEGE GADAG

A FINAL REPORT OF MINOR RESEARCH PROJECT UNDER UGC XI PLAN

ENTITLED MARKETING OF CHILLY IN NAVALGUND TALUKA IN THE STATE OF KARNATAKA Submited by Dr.Mohan. Sangappa. Annigeri. M.com. Ph.D

Submitted Through The College Development Council Karnataka University Dharwad To THE UNIVERSITY GRANT COMMISSSION South western Regional office Banglore OCTOBER 2014

1 DECLARATION

I here by declare that the Minor Research Project Report Entitled

“MARKETING OF CHILLY IN NAVALGUND TALUKA IN THE

STATE OF KARNATAKA” has been undertaken by me for the Minor

Research Project. I have completed this work and also declare that this Minor

Research Project has not been previously formed the basis for the award to the candidate of any Degree, Diploma, Associateship,Fellowship or similar title in any Indian Universities

Place:Gadag Signature of the Date:28th october 2014 Principal Investigator

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K.L.E Society`s JAGADGURU TONTADARYA COLLEGE GADAG. CERTIFICATE This is to certify that the Minor Research Project report entitled “MARKETING OF CHILLY IN NAVALGUND TALUKA IN THE STATE OF KARNATAKA” submitted is a record of research work done by Dr.Mohan.Sangappa.Annigeri, Associate Professor and Co-ordinator for Post Graduation Department of studies in Commerce is a original work of Minor Research Project. This report has not been Previously formed the basis for the award to the candidate of any Degree, Associateship, Fellowship or Diploma similar title in any Indian Universities.

Place:Gadag Regestrator\ Principal Date:

3 ACKNOWLEDGEMENT I Express my Deep Sentiments of Reverences to his Holiness Sri Manjunath Swami of Dharmasthala for his holy Blessingness on all the occasions. I sincerely express my Heartfull Gratitude to University Grants Commission, South Western Regional office, Banglore for providing me an opportunity to undertake a Minor Research Project under U.G.C. office for their kind help and Co-operation to undertake this Minor Research Project Work. I also thankful to the Director of college Development Council, Karnataka University Dharwad for their kind help and Co-operation to undertake this Minor Research Project Work. I am highly indebted to our K.L.E Society`s beloved Chairman Dr.Prabakar Kore and all the Board Members of K.L.E Society Belgaum for their encouragement. I am extending my sincere gratitude towards my respected Principals, Dr. S.B.Havanur, Prin.S.S.Yankanchi and Prin.C.Lingareddy of J.T.College Gadag who are great source of Inspiration to me. I wish to Place on record my Deep sense of Gratitudeness to the Honerable Secretary and office Suprintendent of APMC Annigeri and also to Sri B.I.Hulkund of District Statistical Dept. of Dharwad and Farmer`s of Navalgund Taluk for their help and co-operation in Providing the valuable Research Material Information Timely. I am ever thankful to Dr.B.C.Bannur Principal and Life member, K.L.E.Society`s G.H.college Haveri. Prof:G.P.Kudari, Dr.S.V.Madivale, Prof:S.H.Narisinnavar, Prof: S.V.Kundgoal, Prof:C.S.Angadi of J.T.college Gadag and Dr.S.S.Halageri of G.H. College Haveri for their kind encouragement and Moral support, Valuable advice and Co-operation during the Period of my Project Work.

4 I owe Debt of Gratitude to Sri B.M.Lakkammnavar Librarian of J.T. college Gadag and also the Librarian of Karnataka University Dharwad , Agriculture University Dharwad for Providing the reference facilities for the said Project work and I am also thankfull to Sri U.S.Tuppad office Supritendent of J.T.college Gadag for his co-operation help and encouragement. Furthur I am extremely gratefull to the respected collegues, friends and all teaching and non- teaching staff of J.T.college Gadag for their co-operation, suggestions and encouragements. Finally, I extend my deepest gratitude to my wife Smt.Pushpalata and my son Achyutprasad and Daughter [Dr] Tejashwini and my relatives for their constsnt moral support in completing this work. Lastly, I am Immeasurably thankful to all others who have directly and indirectlys helped me in my Project work.

Place:Gadag Dr.Mohan.S.Annigeri. M.com , Ph.D Date: Asso.Professor and P.G.Co-ordinator, Dept. of Commerce, K.L.E.Society`s J.T. College Gadag

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SL.No CONTENTS Page Nso.

I INTRODUCTION

II ECONOMIC DIMENSIONS OF CHILLY- GLOBAL ,NATIONAL AND REGIONAL PERSPECTIVES III PROFILE OF CHILLY-GROWING FARMERS COVERED BY THE STUDY IV PRODUCTION DIMENSIONS OF CHILLY IN NAVALGUND TALUKA. V MARKETING DIMENSIONS OF CHILLY IN NAVALGUND TALUKA VI SUMMARY OF FINDINGS, CONCLUSIONS AND SUGGESTIONS VII BIBLIOGRAPHY

VII QUESTIONNAIRE

6 LIST OF TABLES Sl no Table no Title of the table Page no 1 2.1 Area, Production yield per and Hectare of Chilly in India 2 2.2 Area, Production yield per and Hectare of Chilly in Karnataka 3 2.3 Area, Production yield per and Hectare of Chilly in Dharwad district 4 2.4 Area, Production yield per and Hectare of Chilly in Navalgund Taluka 5 3.1 Distribution opf large and small farmers in the two Hobli villages of Navalgund Taluk of Dharwad District 6 3.2 Age composition of Farmers 7 3.3 Educational Status of Farmers 8 3.4 Size of the farmers family 9 3.5 Caste wise distrubution of farmers 10 3.6 Occupational Pattern of Farmers 11 3.7 Income status of Farmers 12 3.8 Fixed Assets of Farmers 13 3.9 Live stock Assets of the farmers 14 3.10 Vichicles of the Farmers 15 3.11 Owned and Rented lands of Farmers 16 3.12 Irrigated and Non-irrigated lands of Farmers 17 3.13 Types of land cultivated by Farmers 18 3.14 Crop Pattern of Navalgund Province 19 3.15 Sale Procedure of Regulated Produce 20 3.16 Market Cess, Licence fees and other fees 21 3.17 Income and Expenditure and Savings 22 3.18 Arrival of major Agricultural Produce

7 23 3.19 Market Intermediaries 24 3.20 Production of Dry Chilly, sales quantity and value 25 3.21 Market Intermediaries 26 3.22 Age Composition of Intermediaries 27 3.23 Educational Status 28 3.24 Caste Affiliations of Market Intermediaries 29 3.25 Duration of Working as Market Intermediaries 30 3.26 Services Rendered to Farmers by the Market Intermediaries 31 3.27 Main Buyers of Dry Chillies 32 4.1 Area, output and yield per hecter of Dry chilly in Navalgund taluk province 33 4.2 Cost of Tilling and managing 34 4.3 Cost of sowing chilly 35 4.4 Cost of cleaning chilly 36 4.5 Cost of Harvesting chilly 37 4.6 Cost of seeds 38 4.7 Cost of rental for Hired Land 39 4.8 cost of wages of regular workers 40 4.9 Ownership of Land 41 4.10 Current value of Land 42 4.11 Value of Agricultural Implements 43 4.12 Loans obtained by Farmers 44 4.13 Working capital- Source & Extent of Amount used 45 4.14 Ranks indicating Preference for Chilly crop by Farmers 46 4.15 Used of innovative methods of cultivation of Chilly crop 47 4.16 Market Trends and price changes influenced the chilly production 48 4.17 Family Members employed in chilly farming 49 4.18 Employment of Hired workers

8 50 4.19 Wage rates for Hired Workers 51 5.1 Assembling of Chilly 52 5.2 Storage of Chilly 53 5.3 Adequacy of storage facility 54 5.4 Packing and packaging cost 55 5.5 Reasons for local sales 56 5.6 Preference for sales of Dry chilly 57 5.7 Satisfaction about the channel of distribution 58 5.8 Cost of grading 59 5.9 Own and hired vehicles for transport 60 5.10 Annual cost of transport 61 5.11 Sources of market information 62 5.12 Marketing Finance – use of the Sources 63 5.13 Marketing cost of Dry chilly 64 5.14 Reasons for Dis-satisfaction of present pricing system 65 5.15 Suggestions for better price for Dry chilly 66 5.16 Price of Dry chilly 2005-06 to 2009-10 67 5.17 Marketing problems [No. of farmers]

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13 CHAPTER-I INTRODUCTION

Marketing of agricultural goods in India assumes greater significance as the major portion of the population is engaged in agriculture related activities. The recent developments in the field of agriculture like High Yield Variety Programme (HYVP) besides contributing to green revolution have further increased significance of agricultural marketing. Today, agricultural sector is not only supplying the food requirements, but also contributing to the foreign exchange of the country. Like in the case of marketing of other kinds of goods, marketing of agricultural goods too is a business venture, covering all activities in the flow of goods and services from the producer-sellers to the ultimate buyers. Thus, in the process of agricultural marketing, the farmer-sellers are on the supply side, the ultimate buyers are on the demand side and in between these too, the various intermediaries are functioning. Thus, agricultural marketing is a process which starts with the decision to produce a farm commodity and it involves all aspects of market structure or system, both functional and institutional, through which goods move from producer to consumer‟.1 The development of the country is closely linked with the development of agriculture. The development of agriculture is dependent upon the facilities available for marketing of agricultural produce. 'The marketing of agricultural products is a matter of great interest to the farmer, the consumer and the middleman. To the farmer, it provides the channel of communication between him and the society and gives him continuous information about demand for his products. The consumer views it as a means of supplying his need since marketing helps in raising the standard of living of the people by satisfying the multitude' of needs and desires of consumers. The middleman depends upon it for his livelihood.2

14 In a developing country like India, marketing of agricultural goods is also responsible for the well-being of the farmers. The better facilities and opportunities for farmers to undertake marketing of their produce, the greater the interest for them to increase the production. Thus, switching over to commercial farming from subsistence farming is possible.

Agricultural marketing is expected to promote the welfare of the farmers' class in particular, and that of the consumers in general. So,the marketing of agricultural activities are switching over to commercial forming from subsistence forming. However, over the period, Indian agricultural marketing is criticized for its operational and pricing inefficiencies. The present study is a modest attempt in understanding the glaring and latent operational problems in the functioning of a regional regulated market area of Navalgund Taluk.

CHILLI:

The major cash crop undertaken for the present study is Chilli. The brief history and origin of chilli is highlighted with its importance among the cash crops.

Chilli (Capsicum annuum L.; Capsicum frutescene L.), also called red pepper‟, is an important cash crop in India and is grown for its pungent fruits, which are used both green and ripe (the latter in the dried form) to impart pungency to the food. As a condiment, it has become indispensable in every Indian home. It is also used medicinally, and in chutnies and pickles. The pungency is due to the active principle `capsicin‟ contained in the skin and the septa of the fruit. The world consumption of chillies and paprika is going up due to the increasing popularity of ethnic foods. The increased availability of oleoresins and spice oils of chilli has also enhanced its consumption in various food preparations. India is the largest producer of chillies in the world but its production pattern is highly erratic.

15 The chilli crop is grown from almost the sea-level up to an altitude of 1,500 metres in tropical and subtropical regions, with an annual rainfall of 60- 150 cm. In India, chillies are now grown in almost all parts. At present, Andhra Pradesh, Karnataka, Maharashtra, Orissa, Rajasthan, Tamil Nadu and West Bengal account for 85.8 per cent of the total area and 89.3 per cent of the total output of chillies in the country. Chilli is cultivated in Guntur, Warangal, Khammam, Krishna, Hyderabad, Pundur, Nizamabad, Cuddapah, Rajahmundry and Nellore districts in Andhra Pradesh; Hubli, Gadag and Byadgi in Karnataka; and Nashik, Ahmednagar, Sholapur, Aurangabed, Nanded, Amravati and Lasalgaon in Maharashtra. In Punjan and Haryana, chilli is cultivated in Amritsar, Nabha, Patiala, Sunam and Samna; in Uttar Pradesh in Bareily and Khurja; and in Tamil Nadu in Tuticorin and Salem. In India, chilli is being cultivated mostly as a rain-fed crop therefore its yield fluctuates from year to year and is generally poor. Recently, its production has been taken up in irrigated areas in non-traditional states like Punjab and Uttar Pradesh also where the yield has been better which is likely to boost its output in the coming years. Productivity Enhancement The scope for increasing the area under production of cash crops is limited. Hence the bulk of the future increase in cash crops production have to come primarily from land saving technologies - a combination of high yielding plant type, standard crop management practices and balanced crop nutrition. The needed measures for improving cash crops productivity involve: i. Delineating efficient zone for different cash crops through crop ecological zoning. ii. Adequate supplies of quality seeds of improved varieties and hybrids. iii. Bringing more cash crops area under protective irrigation. iv. Integrated nutrient supply and management. v. Efficient crop management practices starting from adoption of proper crop rotation

16 vi. Suitable soil and moisture conservation practices vii. Timely planting viii. Adequate plant stands through adjustment in seed rate and thinning ix. Timely Weed management x. Need based crop protection xi. Balanced crop nutrition and xii. Timely harvest and safe storage Market and Price Trends of Cash Crops The prices of cash crops in seventies and eighties tended to decline sharply in the market soon after harvest and rise inordinately a few months later in the lean season. The difference seemed to be more than the holding cost of storage, interest and reasonable profit with the result that both the farmers and the consumers were the sufferers. “Fixing minimum support price for cash crops and entrusting public agencies like National Agricultural Cooperative Marketing Federation (NACMF) with effective market intervention is essential to ensure protection of returns and encourage adoption of modern crop production technology by the oil seed farmers”. Chilli as Cash Crop Chilli is grown all over India. In 2003, it was grown on an area of 945.5 thousand ha with an annual production of 4.5 million in fresh weight (FAOSTAT-Agriculture). India is one of the largest producers of pimento chili in the world, accounting for over 46% and 44% of its total area and production, respectively. However, its per ha productivity is quite low at 4.7 t in fresh weight compared to China, Turkey, and Pakistan at 25.6 t/ha, 8.9 t/ha, and 7.9 t/ha, respectively. India exported 349 thousand t of fresh weight equivalent chili worth US$62 million. This leaves a net annual per capita availability from domestic sources at about 3.9 kg in fresh weight. Despite the importance of chili in the production system of certain states and Indian diet, no comprehensive

17 study is available on the issues and constraints at its various food chain levels. This study aimed to fill this information gap by conducting interviews and surveys from different stakeholders involved in the food chain, and analyzing secondary data related to its production, consumption, and distribution. The overall per ha yield of chili in the study area was about 10 t/ha in fresh weight. This estimate was higher than the national average as well as the estimate at 7.5 t/ha. This may be due to the concentration of our survey in major chili growing areas. Utilization Among the various spices produced in the country, the consumption was highest for chillies. It was consumed either in green or powder forms. Very little other form of processed chilli products were used in India. When all consumed chilli items were converted into fresh weight, about two-thirds of the consumption by chilli farmers, one-half by non-chili farmers and one-third by urban consumers were in chilli powder form. Chilli farm families consumed about one-fifth of the fresh chili weight in green fresh form, while the ratio for the non-chilli growing farm and urban families was about one fourth. The share in the consumption of other chili forms and products were relatively small in India. Marketing and Trade The cash crops have a larger market in the present day trend. These cash crops are sold like hot cakes in the market. The demand for these cash crops is everlasting because they are consumable goods. Hence there is a dire need for the cash crops there is a scarcity of these products due to draught during last three years. Hence the study proves that the market is wide open for the by products of the cash crops. The advertisement world is also fetching lot of money from the sale of by products of these cash crops. The export quality products are always attracting the foreign market today. The marketing season

18 for the chilli is normally starts from November to February. The Buyers and the Location The sale of Chilli take place at the nearest assembling market at the farmers own location where dealers buy the same. The dealers may be village merchants, itinerant dealers and agents of wholesale merchants and in some cases the agents of oil crushing concerns. The oil milling units, pressing of chilli units play an important role where there are no regulated markets. They collect Chilli crop from the villages either through their own agents or through village merchants by giving them financial help to run their business. The village merchants collect seeds from their own village or nearby villages. They carry on money lending business by way of advancing small amounts to the cultivation with the understanding the receiver would dispose of the produce to them or through them only. The Chilli crop producers generally prefer to take their produce to the market for sale but their indebtedness or financial obligations compel them to sell through the village merchants from whom they receive financial help. The Chilli crop producers decide either to sell the produce at the village or take it to the market on the basis of i. Quantity of produce ii. The distance from the market iii. Transport facilities iv. Market Charges v. Price at Village level and vi. Immediate need for cash Chilli Crops markets fall under 3 groups i. Primary markets ii. Secondary markets and iii. Terminal markets Primary markets are weekly bazaars dealing in small scale retail sales.

19 Secondary markets are mendis organs which provide permanent place for the daily transactions to take place with some amenities for sellers and buyers. Terminal markets are urban centres. They get stocks from producing centres as well as from important markets. The regulated markets are managed by the market committees. Transport, Packing and Distribution Chilli crops are brought in pods to the markets or they are filled in gunny bags. They are brought to the market by carts or tractors or lorries on the same day or a previous day of the sale. The sellers take the produce to the shops of commission agents with whom they had prior financial commitments. The commission agents are not changed once they are selected. Auctions are conducted in the market premises. Pricing of Chilli The buyers first examine the produce by collecting a few samples from different parts of the bulk. They consider the condition of the seeds, percentage of damage, immature seeds and the oil content in the seeds etc before giving the quotation.

Method of Sales The major method of sale and pricing of Dry chilli are i. Open system In non regulated markets the produce is kept open for inspection and sales are affected under mutual agreement between the buyer and the seller. ii. Auction System: The produce offered is exhibited for inspection in the regulated markets too. The sales in the assembling markets are affected through commission agents. The buyers examine the quality of the produce and offer their quotations

20 to the commission agents who sell the produce to the highest bidder. All the regulated markets adopt the open auction system. Weighment, Delivery and Payment The produce is weighed in the presence of the seller after the price is settled. The Chilli is subjected to cleaning after the price is settled. The cleaned Chilli is winnowed once, twice or thrice to separate dust, small pebbles and immature and broken Chilli. The Chilli is then filled into gunny bags supplied by the buyers and weighed in the presence of the agent of the buyer. The seller receives the sale proceeds (Usually on the same day) from the commission agent after allowing deductions towards the prescribed market charges. Sometimes the buyers and sellers have to wait up to 15 days as per the customs of the market.

Objectives of the Study The present research study has the following objectives. 1. To study the production dimensions of the cash crops in general and chilli in perticular in the study area. 2. To examine the production problems and production cost of seeds and chilli of the farmers covered by the study. 3. To study the marketing process of chilli and the market problems of chillies farmers. 4. To assess the role of market intermediaries and the APMCs in the marketing of chillies in the study area. 5. To examine the impact of changes in price of chillies on its area, production and productivity. 6. To study the constraints existing in the marketing of Dry chillies. Hypothesis The research study has set forth the following hypothesis

21 1. There is a positive growth and high variability in area, production and productivity of chilli in Karnataka. 2. Financial constraints and inadequate storage capacity compel the agriculturist to sell their produce immediately after the harvest at an unremunerative price. 3. The price changes of chilli crops have positive impact on its area, productions and productivity. 4. Small size of output compels the growing farmer‟s local sales of chillies. 5. Production and marketing costs of chillies are rising faster than the market price of chillies. Limitations of the study The study has been conducted with some limitations. Limitations are restrictive conditions under which the research study is conducted. It is essential for the researcher to reduce the study to workable size and set boundaries by limiting its scope. Following are the limitations of the study 1. Constraints on time and resources of the researcher forced select limited area for the study. Hence, results are largely applicable to those areas where similar conditions prevail. 2. The interview method of data collection requires the respondants to recall from their memories about cultural operations. Hence, the findings may be subject to memory lapses of respondants. 3. The average price realized during the study period was calculated and used in converting production figures from quantities to value terms, although the prices realized differ from farmer to farmer. 4. The sample of respondent chilli growing farmers is limited only to 200 in the 10 villages of two province of Navalgund taluk. Scope of the Study

22 The major areas of the present research study relate to the production and market dimensions of the cash crops in general and chilli in particular in the study area. The production dimensions include the analysis of the variations in the production area, volume of production and productivity of the crop. The study has also provided a comprehensive analysis of the cost structure of the produce and the cost components and their relative significance. The analysis of the production dimensions also relate to the technological level used by the cultivators in the production of oil seeds. The research study involves a systematic analysis of the marketing dimensions of the cash crops produce in general and marketing of chilli in particular in the areas covered by the study. The analysis relates to various marketing processes involved viz., assembling storing, grading, packing, transport, market information, the marketing costs and finance, channels of distribution, pricing etc. The other areas covered under the marketing dimensions relate to the role of market intermediaries and the APMC etc.

The analysis of the production and marketing dimensions has naturally revealed some of the major problem areas of the cash crops industry in general and chilli in particular. Need For the Study and Statement of the Problem The cash crops industry in general and chilli in particular have faced with many problems and challenges. The inadequacy of cropped area, low productivity lack of adequate supply of quality seeds absence of integrated nutrient supply management, inefficient crop management practices, absence of suitable soil and moisture conservation etc are the major problems in the area of production management. The problem areas of marketing of cash crops and chilli relate to absence of scientific assembling and storage, lack of adequate transport and grading facilities insufficient market information. The role of market intermediaries and

23 the APMC have been found unsatisfactory. High marketing costs and inadequate finance resulting in distress sales in the village local sales at low prices are the other set of marketing problems of chilli farmers and sellers. In view of the above areas of production and marketing inadequacies the cash crops in general and chillies in perticular in the study area the researcher felt that, there is need for the study of the production and marketing of cash crops in general and chilli in particular in the study area which is a major producer of cash crops in this part of Karnataka. Hence the present study is selected as stated below:

24 “MARKETING OF CHILLY IN NAVALGUND TALUKA IN THE STATE OF KARNATAKA” Methodology: Choice of the Area The study covers the TEN villages in two provinces of ANNIGERI and MORAB in Navalgund Taluk. These areas have dry climate and have vast stretch of black and red soil suitable for growing Cash Crops like groundnut, cotton and chilli. These cash crops are grown extensively in these areas Hence, the Taluka is selected for the research studies. Choice of Respondent Farmers A total number of 200 respondent farmers growing the chilli have been chosen for an intensive study of the marketing of cash crops with special reference to chilli. Province wise the study covers 100 farmers in each Province for personal interview for obtaining the data. The 200 farmers includes 120 large farmers and 80 small farmers to give proper representation to the two groups of farmers in each Province. The actual selection of the farmers and their location is done on a random sampling basis by taking into account the area under cash crops in general and groundnut, cotton and chilli in particular. Type of Data Collection The study is based on both primary and secondary data. Primary data is collected from the 200 respondent farmers growing cash crops in the 10 villages of the Provinces of the taluka. The data is collected as per structured questionnaire on production and market aspects. The secondary data is collected from the published sources from government and other relevant institutions such as APMCs. Dept.of Agriculture, Dept of Statistics etc.

25 Method of Data Collection The primary data has been collected through personal interviews as per the pretested and structured questionnaire administered to the 200 farmers. The questionnaire for the farmer- respondents consisted of two sections- the first relating to questions on different aspects of production of cash crops, investment, employment and income of the farmers. The second part related to various aspects of marketing of cash crops and chilli viz., assembling, grading, packing, storage, transport, warehousing, insurance, market information, channels of distribution, pricing, marketing costs and finance marketing problems etc. Another questionnaire was administered to the market intermediaries like wholesale merchants, commission agents who operate in the APMC area and provide their services to the farmers selected intermediaries were interviewed as per the questionnaire prepared in advance. Information was also sought and collected from the officials of the APMC in each province regarding the marketing services provided to cash crops farmers who sold their chilli through the APMC. Discussions were held by the researcher with the APMC officials, bank officials and officials of Agricultural Marketing of the State government about the production and marketing of cash crops in general and chilli in particular. Period of Data Collection The data collection was for a period of 7 years from 2003 –2004 to 2009- 2010 for purpose of analysis and interpretation. The five year period was considered adequate to study the trends of production, price and other related aspects of chilli production and marketing in the study area.

Data Analysis and Interpretation

26 The data collected from the primary and secondary sources are presented in suitably planned statistical tables. The data is interpreted through statistical tools by using simple techniques like percentages ratios and averages. Appropriate conclusions and inferences are derived from the statistical tables thus prepared from the data collected. ORGANISATION OF THE STUDY: The research study is presented in the following six chapters. Chapter I: Introduction and Research Study: The first chapter is devoted to a detailed narration of the research design. The chapter provides an introduction to the problem of chilli production and marketing highlighting the issues and problems involved therein. The other aspects include the clarification of the objectives, the assumed hypotheses and limitations of the study, the need for the research and a detailed presentation of the methodology of data collection. The chapter also contains a comprehensive review of the existing literature related to the topic of research. Chapter II: Growth of Chillies – Global, National and Regional Perspective: The second chapter provides economic dimensions of chillies with a global, national and regional perspective. The discussion is supported with appropriate statistical information using time series data on area, production and yield per acre of dry chilli. The presentation provides a good backdrop for the analysis in the study area. Chapter III: Profile of the Chilly Growing Farmers Covered by the Study: The third chapter consists of profiles of the selected farmers engaged in the production and marketing of chilli in the study area. The chapter also provides the profiles of market intermediaries and the APMCs in the areas covered by the study. Chapter IV: Production Dimension of Chillies in Navalgund Taluk. The fourth chapter is devoted for an indepth analysis of the production

27 dimensions of chilli of the selected farmers for the study. The study is backed up with statistical support obtained through well structured questionnaire administered to the respondent farmers in the ten villages in two provinces of Annigeri and Morab in Navalgund Taluk. Chapter V: Marketing Dimensions of Chillies in Navalgund Taluk. The fifth chapter provides the findings related to the marketing dimensions of the chilli farmers covered by the study. The data collected from the respondent farmers has resulted in some significant findings. Hence the chapter happens to be one of the core chapters in dissertation. Chapter VI: Summary of Findings, Conclusions and Suggestions. The sixth and the last chapter provide a summary of findings, conclusions and suggestions. Review of Literature: A review of related literature has been made here to gain a proper perception and clarity about the status of production and marketing of oil seeds in general and production and market of groundnut in particular in the historical and contemporary context. The review of research studies in the related field has been useful in understanding appropriate tools and techniques that can be used in the analysis appreciating the various evidences generated and policy prescriptions suggested there in. Such a review of literature would provide a basis for either for conforming the earlier results or for contradicting them and there by suggesting the points for further improvments. The review literature is presented as under:

DRY CHILLIES: Studies on Marketing of Chillies are limited in Number. They related to various aspects of Chillies like cost of Cultivation, output, Return, Manpower, Price Structure, and Cost of Marketing etc. Research Papers, Reference books, dissertations Published and Unpublished Doctorate Theses Constitute the main Literature available on the Subject. An attempt is made to present a brief

28 Review of some of those writings.

K. Raji Reddy1 K. Raji Reddy has made a Study of marketing of chillies with Special Reference to Guntur, Warangal and Ananthpur district in Andhra Pradesh. In this published Doctorate Research Study, Raji Reddy has made on In-depth Analysis of Cultivation, Practices of Chillies, Assembling and Distribution, Grading, Storage, Packing and Transportation Price structure and Role of Regulated Markets in Marketing of Chillies. The Study covers a period of Ten years from 1975 to 1985. Based on a Sample Survey of Farmers and Merchants, the Study Provides an insight into the marketing Problem confronting this important primary product which has good Potential for Domestic and Export sales. The Researcher has analysed all the aspects of the marketing mix pertaining to marketing of Red chillies. The findings have a Practical Value and go a long way in improving the marketing prospects of this important spice in the country‟s Economy. This study has bearing on the analytical Approach in this Research work.

K.A. Yeledhalli2 K.A. Yeledhalli has made a Study of Production and Marketing of Dry Chillies in Dharwad District. He has made an Elaborate analysis of Cropping Pattern, growth Rates, Costs, Return and Profits. His analysis of Relationship between market Trends and Prices of chillies is Very relevant. Equally analytical is Comprehensive backed by Empirical evidences in the leading chillies Markets in Dharwad District. The Author has made use of Advanced Statistical techniques to derive precise inferences. The Author‟s attempt in providing a Comprehensive picture of issues of Marketing of Dry chillies is quite useful for the future Researcher‟s. However, his reflections on the Role of intermediaries in the Marketing of Dry chillies seem inadequate. The Present Study has tried to overcome this deficiency.

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P.G. Patre3 P.G. Patre‟s Study on Marketing of chillies in Byadgi is a Very Productive effort in presenting different dimensions of Marketing of Chillies in the leading Marketing Centere of Byadgi for chillies in Karnataka. The Researcher has made a detailed Study of the Origins of the Arrivals of the Dry Chillies to the Main Market at Byadgi, The important facilities and Problems the Channels of Sales in the Market and their efficiency in terms of Marketing Casts, and Margins etc. His analysis also covers the Role of Co-operative institutions in the Marketing of Chillies in the area. His analysis of Price trends in the market is also Very useful. His analysis of the Price Spread and the Share of Producers in the Consumer‟s Rupee in the Sample Market is quite revealing. The Study is limited to only one Market for chillies at Byadgi. Comprehensive Picture cannot emerge from his Study. Since he has not made simultaneous study of another market the Present Researcher has tried to overcome this deficiency as well.

M.M. Hosamani4 M.M. Hosamani of the University of Agriculture Science Dharwad has brought out a good Publication on “Chilli Crop”. The Author has provided a good analysis of the Horticulture and Marketing aspect of Chilli Crop. A Special discussion of grading, Marketing and export aspect have Special relevance for the Present Study. He has discussed the grading aspects with reference to both domestic and Export Markets in the light of the Stipulations of “Agmark”. He has analysed the Volume of Trade and Price Structure over a Period of 2 decades from 1970-71 to 1991-92 and has covered National and State level Dimensions. His discussion on Export aspects of Chillies is quite comprehensive Price Trend analysis has also been done with reference to the factors influencing the Price of the Chillies during different seasons. He has also

30 made a brief reference to Marketing Methods, Drying and Cost Cultivation etc.

M.H. Beturmath5 M.H. Beturmaths Study on Marketing and Management of Red Chillies in Dharwad District is another useful Research work based on a Survey of marketing Centres of Red Chillies in this District which is one of leading district in the Production of Red Chillies in India. His discussion is devoted to the detailed analysis of Marketing System of Red Chillies in Dharwad District. Similarly the Study is devoted to an intensive analysis of the Marketing of Red Chillies in Byadgi Taluk of the District. Here the analysis is highly informative and has empirical Volume too. Again the Study is devoted to an analysis of the Problems of Farmers and Marketing functionaries. The whole exercise is focused on the different aspects of marketing areas related to the Marketing of Red Chillies. Here, too the Comprehensive Picture of Marketing Practices in different areas of the district has not emerged. The Deficiency too is over come in the Present Study.

Usha K. Nagabhushanam and Krishnia6 The Study on “Operational Efficiency” of Two Regulated markets for Chillies in “Andhra Pradesh” by - “Usha K. Nagabhushanam and Krishnia” has been done to asses the operational efficiency of marketing of Dry Chillies in Medak district of Andhra Pradesh. The Author has made a Comprehensive Study of Operational Efficiency of marketing by selecting two important sub- markets of Sadasivpet and Jogipet. The Authors have assessed the operational efficiency of these two markets on the basis of the Major functions of the Regulated Markets with reference to the Andhra Pradesh, Agricultural Produce and livestock market act 1966 by constructing the overall index of operational efficiency by giving weightage to identitied functions according to their Relative importance. The Study has concluded that the overall operational efficiency of the markets was 58% and 46.5% for Sadasivpet and Jogipet

31 respectively. Hence they have concluded that there is need for Streamling the markets total operational efficiency. This is a good study and useful for Researchers to do Similar Studies in other area‟s. Kamat G.S. and Purashottam P7 Kamat G.S. and Purashottam P Made a Study of economies of Storage in Marketing of chillies in the Andhra Pradesh. The Study revealed that the temporal Price fluctuations exceeded the reasonable Costs of Storage. The Authors reported that during the 11 out of 16 years covered by the study, the Storage operations were Profitable. They further concluded that through the farmers are aware of the gains from Storage operations; their Poor Holding Power compelled them to sell at the harvest Time. The Authors have suggested linking Credit with Marketing to enable farmers to avail of the benefits accruing with Storage Operations.

Mishra, Vishwakarma and Rawat8 Mishra, Vishwakarma and Rawat have made a Study of Production and Marketing of Chillies in Azamargh District of Uttar Pradesh. The Author has made the study with two Main Objectives. 1. To work out the Cost of Cultivation and cost of Production of Chillies and 2. To Study the Price Spread in the Marketing of Chillies. The findings of the Study are quite revealing. The Average Cost of inputs for marginal farm was Rs. 22, 782.67 per hectare. While the Average Cost of input for a Small and Medium and other farms were Rs. 22,498.79 and Rs. 21,528.87 per hectare respectively. The over all average cost of farm inputs was Rs. 22,493.02 per hectare. The Return from the Production of Chillies was 62.91 quintals for marginal farms 61.87 Qtls for small farms and 60.44 quintals for medium / other farms. The Average yield was 62.17 quintals. The Gross income from Marginal Small and Medium / other was Rs. 51,785.00 Rs. 50,928.91 and Rs. 49,751.79 respectively. The Average Gross

32 income was Rs. 50,957.45 per hectare. The Net income from the respective size of Farms was Rs. 29.002.33, Rs. 28,430.12 and Rs. 27,902, 92. The average net income was Rs. 28,518.45 per hectare. The Price-Spread for the sale of Chillies studied by the authors, reveals that the Producer, received 98.82% of the Consumer Price when the Producer sells to Consumer. The Price received by the Producer is 90.85% of consumer Price when Producer sells to the Retailer and then to consumer. While the Price received by the Producer is 74.17 % when the chillies are sold to a consumer through Producer -> Wholesaler -> Retailer -> consumer channel The Study is a Sample Survey in a chillies Market in A.P. Such studies have a good bearing upon Similar Studies like the present one are useful to future researchers.

N.S.R. Murthy9 N.S.R. Murthy has made a study on “Chillies Quality improvement at Form Level”. He has pleaded for Quality improvement at Farm Level, Keeping in View of the quality conscious consumers in the Sophisticated Markets of Europe and U.S.A. He has suggested adopting mechanical drying, as it would reduce the drying period and would help for Retaining the Colour of Red- Chillies. He has proposed for Scientific grading and Packing of chillies Particularly for Export Market.

M.N. Ramachandran10 M.N. Ramachandran has emphasised the grading quality assessment of chillies. In his paper on “Grading and quality assessment of Agricultural Commodities under Agmark and Agmark Grade Specification for chillies has laid Particular emphasis on the following two Aspects. i) Improve Practices to minimise losses and quality deterioration of the Product. ii) Strengthen the marketing infrastructure which can deliver a fair and Remunerative Price to growers.

33

He has highlighted role of Directorate of Marketing and Inspection in implementing the grading Provisions under the Agmark Standards and quality assessment scheme of Directorate. The Author has provided details of grading Procedure for both internal & Export markets.

M.P. Suresh11 M.P. Suresh Study on “Chillies International Markets and Indian Exports” is quite revealing and has Practical Significance to exporters of dry chillies from India. He has highlighted the Competition from China to Indian export of chillies and Pleaded for the necessary improvement in the Marketing efficiency of Indian Exporters. Suresh has pleaded for diversifying exports of different Varieties and makes of Red Chillies and has emphasized the importance of exporting oleoresin to western Markets, where there is good demand for the same.

Brahmaiah P12 Brahmaiah P have identified in their study that majority of Farmers have adopted channel -III 76.67% (Selling at Regulated Markets) for selling their chillies where as channel-I and Channel-II (Farmers Selling to Village Trader and Farmers Selling to processor respectively) were chosen by meagre 16.66% and 6.67% of Farmers. Further the Authors Maintained that a higher Percentage of large farmers have adopted channel-III over small and medium farmers. The Authors asserted that regulated markets have not attained all categorize of Farmers in the Same Manner. This Study has helped in a better approach of the field Study of the Present Research work.

All India Spices Board and A.P. Agricultural University13 National Seminar on Chillies, Ginger and Turmeric Jointly organised by All India Spices Board and A.P. Agricultural University in 1998 has made some

34 important Suggestions on Production and Marketing of Chillies. 1. The marketing Research should be strengthened to develop and popularize the marketing of chillies. 2. Possibilities of Mechanical drying should be studied. 3. Inter Cropping should be Advocated and Studies Should be undertaken regarding inter Cropping Practices. 4. Cost-benefit Ratio‟s should be worked out for chillies in various regions under different pattern of cultivation. 5. Quality studies in response to the use of Fertilisers and Plant Protection Chemicals should be taken up. 6. Post-harvesting techniques should be developed to Prepare chillies according to the requirements of Export Market. 7. Developmental activities should be taken up through field demonstrations regarding Package, Practices, Post-harvest, techniques, Preservations of seed materials etc. 8. New International market should be explored for chillies export. 9. Spice Board should undertake market Research of the International / domestic Markets for chillies. 10. Modalities for determining the Remunerative Prices to protect the farmers from Price fluctuations should be worked out. The above views expressed at the Seminar have a good bearing on the Present Study in the analysis of different aspects of marketing of Chillies.

Sharma4 Sharma (1977) studied the effect of Area, Yield and Price on increase of value of crop output in India for the Period 1960-61 to 1970-71. The author used his own decomposition scheme in measuring the effects of Productivity, area, and Prices and their interactions in the increase of value of Production of wheat, rice, Pulses food grains, oil seeds, sugarcane, Jute, tobacco, cotton, tea

35 and Chillies. In case of cash crops like Sugarcane, Jute, Tobacco, and Chillies, area effect was higher than yield effect by 0.74%, 40.09%, 10.08% and 3.72% respectively. The Price effect was in the Range of 49.22% to 74.37% in respect of these crops. The Price effect in case of Cotton was found to be 142.95% which offset the negative effect of yield, area and interaction and thus resulted in a net increase in income by Rs. 1,538 million.

Agriculture associated technology5 Instability in Agriculture associated with new technology‟s was studied (Jha, 1994) and the Results revealed that instability in gross return of Crops was highest in Rabi Oilseeds (153%) followed by gram, course cereals, cotton wheat and paddy in the first Period (1972-73 to 1980-81). Instability in Gross return of Paddy was however, small in Period-II (1981-82 to 1990-91) may be because of fluctuation in Area under basmati paddy during 1980 s. Maize and Cotton showed decline in Instability of Gross Return in Period-II while instability in yield increased thereby emphasizing the Role of Price Instability in explaining the Instability in Gross Return.

References 1. K. Raji Reddy Marketing of chillies. Printed well Jaipur. PP-21 to 35. 2. K.A. Yeledhalli Production & Marketing of Dry Chillies in Dharwad District An Economic analysis, Dissertation, Submitted to UAS DWD 1980. PP - 28 to 35. 3. P.G. Patre Marketing of Chillies in Byadgi, A Dissertation Submitted to K.U.D. 1989. PP - 18 to 26. 4. M.M. Hosamani Chilli Crop UAS, DWD 1993. 5. M.H. Bethurmath, Marketing and Management of Red Chillies in DWD district Acommodity Approach, Dissertation Submitted to Shivaj

36 University Kolhapur 1990. 6. Usha K. Nagabhushanam and J. Krishna operational efficiency of two regulated Markets of Chillies in A.P. Agricultural Marketing 1989, Vol 32. PP - 16 to 19. 7. G.S. Kamat and P. Purushottam. Economics of Storage in Marketing of Chillies in A.P. Agricultural Marketing Jully - 1978. P - 17. 8. J.P. Mishra etal. Production and Marketing of Chillies. The Bhihar Journal of Agricultural Marketing March 1999. 9. N.S. Murthy, Chillies, “quality improvement at farm level in quality Improvement of chillies”. Spice Board 1998. PP - 1-10

10. M.N. Ramachandran, Grading and quality Assessment of Agricultural Commodities under Agmark and Agmark Grade Specification of chillies. I bid PP 18-29. 11. M.P. Suresh Chillies International Markets and Indian Exports. I bid PP 38-44. 12. Brahmaiah P. etal. Impact of market Regulations on Farmers Economic Development A case Study paper presented at seminar on Agricultural marketing and Economic Development, Institute of Development Studies University of Mysore Oct - 12-14-1998. 13. Reproduced from K. Raji Reddy book - marketing of chillies. 14. Reproduced from K. Raji Reddy book - marketing of chillies.

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37 CHAPTER – II ECONOMIC DIMENSIONS OF CASH CROPS – GLOBAL, NATIONAL AND REGIONAL PERSPECTIVES Agricultural marketing is now being considered as an integral part of production process itself. The development of the country is closely linked with the development of agriculture. The development of agriculture is dependent upon the facilities available for marketing of goods supplied by agriculture. 'The marketing of agricultural products is a matter of great interest to the farmer, the consumer and the middleman. To the farmer, it provides the channel of communication between him and the society and gives him continuous information about demand for his products. The consumer views it as a means of supplying his need since marketing helps in raising the standard of living of the people by satisfying the multitude' of needs and desires of consumers. The middleman depends upon it for his livelihood.

In a developing country like India, marketing of agricultural goods is also responsible for the well-being of the farmers' class. The better the facilities and opportunities for farmers to undertake marketing of their produce, the greater the interest for them to increase the production. Thus, switching over to commercial farming from subsistence farming is possible. Agricultural marketing is expected to promote the welfare of the farmers' class in particular, and that of the consumers in general. However, over the period, Indian agricultural marketing is criticized for its operational and pricing inefficiencies. The present study is a modest attempt in understanding the glaring and latent operational problems in the functioning of a regional regulated market at Navalgund taluk. The main cash crop Chilli which is undertaken for the present study are analyzed respectively with the Global, National and Regional Perspectives here under:

38 DRY CHILLI: The major cash crop undertaken for the present study stands for Chilli. Chilli (Capsicum annuum L.; Capsicum frutescene L.), also called red pepper‟, is an important cash crop in India and is grown for its pungent fruits, which are used both green and ripe (the latter in the dried form) to impart pungency to the food. As a condiment, it has become indispensable in every Indian home. It is also used medicinally, and in chutnies and pickles. The pungency is due to the active principle `capsicin‟ contained in the skin and the septa of the fruit. The world consumption of chillies and paprika is going up due to the increasing popularity of ethnic foods. The increased availability of oleoresins and spice oils of chilli has also enhanced its consumption in various food preparations. India is the largest producer of chillies in the world but its production pattern is highly erratic. Area of Cultivation The chilli crop is grown from almost the sea-level up to an altitude of 1,500 metres in tropical and subtropical regions, with an annual rainfall of 60- 150 cm. In India, chillies are now grown in almost all parts. At present, Andhra Pradesh, Karnataka, Maharashtra, Orissa, Rajasthan, Tamil Nadu and West Bengal account for 85.8 per cent of the total area and 89.3 per cent of the total output of chillies in the country. Chilli is cultivated in Guntur, Warangal, Khammam, Krishna, Hyderabad, Pundur, Nizamabad, Cuddapah, Rajahmundry and Nellore districts in Andhra Pradesh; Hubli, Gadag and Byadgi in Karnataka; and Nashik, Ahmednagar, Sholapur, Aurangabed, Nanded, Amravati and Lasalgaon in Maharashtra. In Punjan and Haryana, chilli is cultivated in Amritsar, Nabha, Patiala, Sunam and Samna; in Uttar Pradesh in Bareily and Khurja; and in Tamil Nadu in Tuticorin and Salem. In India, chilli is being cultivated mostly as a rain-fed crop therefore its yield fluctuates from year to year and is generally poor. Recently, its production has been taken up in irrigated areas in non-traditional states like Punjab and Uttar Pradesh also where the yield has been better which is likely to boost its output in the coming years.

39 Season The chill crop does well in the tropical and the sub tropical regions with annual rainfall of 60-150 cms. Very high rainfall during its growth is harmful. When grown in the hot weather or in lower-rainfall tracts, it is cultivated as an irrigated crop. Normally the sowing is done in June-July and plucking in January. The chilly plant lasts for one season only. It is plucked 3 to 4 times in the season.

Soil The rain-fed crop does well on deep, fertile, well-drained black cotton soils. In ill-drained soils, the plants shed their leaves and turn sickly even with temporary water-logging. Under irrigation and good manuring, excellent crops can be raised in sandy and light alluvial loams as well as in red loamy soils. Harvesting

The crop becomes ready for harvesting in about 3/1/2 months after planting. The picking of ripe fruits continues for about 2 months and about 6-10 pickings are taken. If there is a demand for green chillies, the first one or two pickings are taken for this purpose. The summer crop is wholly disposed of as green chillies. Ripe fruits are picked along with stalks and are heaped indoors for 3 or 4 days for the partially ripe fruit to develop the proper red colour. They are then dried in the sun for 4 to 5 days, depending upon weather conditions and are graded for size and colour before marketing. Unripe chillies are sometimes boiled and dried for domestic consumption. Commercially, there are various grades, such as the first sort, the second sort, mixture, etc. Grades, such as special, medium and fair are also adopted. Good fruit length, shining red colour, high pungency and strong attachment of the calyx are the important factors, which the merchants consider for fetching a high price. In the USA and other countries, there is a liking for stalkless chilli pods of deep red and glossy

40 pericarp. Artificial drying favours the retention of the deep and red colour and smooth and glossy pericarp, as the produce is dehydrated within a short period of 18 hours. Pods of `G-3‟, which have a cup-shaped calyx and compressed base are reported retained intact since the thalamus portion, which is compressed, prevents shedding.

World Scenario of Dry Chilli

Chilli powder is a world renowed spice that is used in many cuisines and recipes of various cultures to add a tingy taste to them. It is often reffered to as a type of pepper due to its matching taste but interestingly it is not even close to the family of piper nigrum rather it belongs to the family of capsicum. Chillies come in different colors, varieties, fragnances, sizes etc but are similar in structure i.e a hollow, seed containing, and tube like structure. A substance known by the name of Capsaicin results in the pungent flavor of the fruit.

Both green and dry chillies are produced world over from the chilli crop. The world production of chilli crop sums up to around 7million tons that is cultivated on approximately 1.5 million hectares of land. India is the world leader in context of chilli production followed by China and Pakistan. This shows that the bulk share of chilli production is held by the Asian countries though it is produced throughout the world. The large demand of chilli is made by several chilli consuming countries as it forms part of cuisines of various cultures and is also used as a coloring agent. Most of its demand is generated in the food processing sector. The following countries are the major consumers of the world with India again leading the list India China Mexico Thailand United States of America United Kingdom Germany Sweden.

As the leading producer of chilli crop in the world, India is also the largest exporter of chilli in the world. It contribues to ¼th share in the total

41 quantity of chilli exported in the world. But China isnt far behind from India and it has been providing a severe competition to the Indian dominance due to India‟s variable supply and high domestic consumption.The major chilli exporting players along with their percentage share in the world total exports are India (25%) China (24%) Spain (17%) Mexico (8%) Pakistan (7.2%) Morocco (7%) Turkey (4.5%). World trade in chillies account to an approximate of 16% in the total spice trade in the world. This share places chilli on the second position after black pepper in the world trade. The following is the list of the leading chilli importing countries in the world United Arab Emirates European Union Sri Lanka Malaysia Japan Korea. Chillies originated in the Latin American regions of New Mexico and Guatemala as a wild crop in around 7500BC. The people native to these places domesticated this crop in 5000BC as per the remains of the pre historic Peru. This crop is said to be the first ever domesticated crop in America. In that time, chillies were cultivated by the farmers with a primary crop to protect the primary crop from any damage that the birds could do. It gained popularity in the American continent as a flavoring and was being largely cultivated since then.

When America was discovered, and the Spaniards and Portuguese explored the South American continent, this pungent flavored fruit gained the much more deserved recognition. Christopher Columbus, the founder of America, was one of the first Europeans who encountered and consumed chilli, and called it peppers due to the similarity in taste. It was found that crushing the dried pods give chilli powder, which later was identified as a substitute of „peppercorn‟. In some time, chilli earned more recognition as compared to the peppercorns being simpler to produce and a lot too hot from the other spice. This crop came into the Asian continent in as late as the 16th century with the identification of new sea routes by Portuguese and Spanish explorers. It

42 became popular in the whole of Asia rapidly and native Asians started cultivating this crop here as well. The south Asian climate suited this vegetable crop, and since then the concentration of production of chillies shifted to Asia. In today‟s scenario, the most sharp and valued varieties of chilli are grown and present in Asia only. Chilli producing countries As chilli is a simpler crop to cultivate, it is produced all over the world. The world production level has been on an increasing trend and there has been a significant rise in the production level since the late 1990s. It has reached around 7 million tons now from the figure of 2.5 million tons in the last decade. The major chilli producing nations are India (Asia) China (Asia) Indonesia (Asia) Korea (Asia) Pakistan (Asia) Turkey (Asia) Sri Lanka (Asia) Nigeria (Africa) Ghana (Africa) Tunisia (Africa) Egypt (Africa) Mexico (North America) United States of America (North America) Yugoslavia (Europe) Spain (Europe) Romania (Europe) Bulgaria (Europe) Italy (Europe) Hungary (Europe) Argentina (South America)Peru (South America) Brazil (South America) The largest producer of chillies in the world is India accounting for 11 lakh tons of production annually followed by China with a production of around 4 lakh tons, Mexico with the production of around 3 lakh tons and Pakistan also producing 3 lakh tons of chilli every year. India also leads in the context of maximum area covered in the cultivation of chillies.

Production of chilli in India As already mentioned, India is the largest producer of chillies in the world. Its production level hovers around 1.1 million tons annually. India also has the maximum area dedicated to the production of this crop. The major regions where chilli is cultivated in India are Guntur (Andhra Pradesh) Warangal (Andhra Pradesh) Khammam (Andhra

43 Pradesh) Krishna (Andhra Pradesh) Prakasham (Andhra Pradesh) Hyderabad (Andhra Pradesh) Pundur (Andhra Pradesh) Nizamabad (Andhra Pradesh) Cuddpah (Andhra Pradesh) Rajamundry (Andhra Pradesh) Nellore (Andhra Pradesh) Dharwad (Karnataka) Mysore (Karnataka) Hasan (Karnataka) Bangalore (Karnataka) Bellary (Karnataka) Ranibennur (Karnataka) Hubli (Karnataka) Gadag (Karnataka) Byadgi (Karnataka) Nasik (Maharashtra) Ahmednagar (Maharashtra) Sholapur (Maharashtra) Aurangabad (Maharashtra) Nanded (Maharashtra) Amravati (Maharashtra) Lasalgaon (Maharashtra) Bareily (Uttar Pradesh) Khurja (Uttar Pradesh) Amristar (Punjab) Nabha (Punjab) Patiala (Punjab) Sunam (Punjab) Coimbatore (Tamil Nadu) Ramanathapuram (Tamil Nadu) Tuticorin (Tamil Nadu) Tirunelveli (Tamil Nadu) Virudunagar (Tamil Nadu) Kanayakumari (Tamil Nadu) Madurai (Tamil Nadu) Salem (Tamil Nadu) Tiruchi (Tamil Nadu) Villupuram (Tamil Nadu) Cuddalore (Tamil Nadu) Jodhpur (Rajasthan) Ajmer (Rajasthan) Bhilwara (Rajasthan) Pali (Rajasthan) Sikar (Rajasthan) Bharatpur (Rajasthan) Swaimadhopur (Rajasthan) Orissa West Bengal Madhya Pradesh Andhra Pradesh stands first in the list of leading chilli-producing states in India and also constitutes the maximum acreage for chilli cultivation in the country. It occupies 49% share in the Indian total production and produces around 2.7 lakh tons of chillies. Karnataka follows Andhra Pradesh, which share 14% of the production in the country. The major chilli producing states in India namely Andhra Pradesh, Karnataka, Maharashtra, Orissa, Rajasthan and Tamil Nadu contribute to around 86% of total area for the chilli crop cultivation in the country and 90% of the total Indian produce. Indian chilli market Though chillies were introduced to India very late after they were discovered, the delay couldn‟t lessen this country‟s love for this so popular flavoring agent. Indians adopted chillies ever since it was brought into the country and it became an integral part of the Indian culture. Till today many

44 superstitions are related with chillies and it is hanged up at the door with a few lemons as it is considered that this act will guard the house from the evil. Currently, chillies are produced through the length and breadth of the country making the most dominating player in the world market. India produces the maximum amount of chillies in the world figuring up to around 11 lakh tons and is also the leading country in context of area covered in chilli production. This crop is cultivated in almost all the states of the country, Andhra Pradesh being the leader of all. It contributes to approximately 25% of the total production. The varieties of chilli produced by India are Sannam, LC 334, Byadgi, Wonder Hot, Jwala etc. India is also the largest consumer and exporter of this crop. It consumes around 6.2 million tons of chillies i.e. about 90% of the total produce of the country. The demand from the chilli powder-producing sector constitutes to 30% of the total production in the country. Exports of chillies sum up to around 100000 tons, which makes 33% of the total spices exported from the country. The Indian exports in 2003-04 were valued at 366.80 crores. Chilli powder, dried chillies, pickled chillies and chilli oleoresins are some of the forms in which this crop is exported. The major importers of chillies from India are United States of America, Sri Lanka, Bangladesh, Nepal, Mexico, Canada, United Kingdom, Saudi Arabia, Singapore, Malaysia, and Germany Though Indian exports are showing satisfactory trends, nowadays India is facing a very tough competition in the international export market as price of the Indian chilli powder is considered too high for the market and other competitive countries are providing chilli at very competitive rates to the major importing countries. If the country is able to meet the strict quality demands of the international market, the exports can be further improved. Steps have to be taken by the government encouraging the exporters to maintain the Indian dominance in the world market.

45 Market Influencing Factors Seasonal price fluctuations overall production in the country world demand, Stock available in cold storages hedging among the various varieties of chilli and major trading centers of chilli. The major trading centers of chilli and chilli powder in India are Guntur – largest chilli market in the world (Andhra Pradesh) Warangal (Andhra Pradesh) Khammam (Andhra Pradesh) Hindpur (Andhra Pradesh) Raichur (Karnataka) Bellary (Karnataka) Unjha (Gujarat) Chennai Kolkata Mumbai Delhi Ahmedabad Nagpur Chilli is also traded in the Indian commodity exchanges namely National Commodity and Derivatives Exchange of India ltd and Multi Commodity Exchange of India ltd. Dry Chillies Production – The Trends in India India has been a major producer of Dry Chilli in the world. The trends in area under dry chilli crop production and yield per hectare during the period from 2000-01 to 2009-10 are provided in the following table. Table No. 2.1 Area, Production and Yield Per Hectare of Chillies in India. Year Area Production Yield per [in lakh hecters] [in lakh tonnes] hecters/kg 2000-2001 8.36 09.84 1176 2001-2002 8.80 10.69 1215 2002-2003 8.29 8.67 1082 2003-2004 7.74 12.36 1596 2004-2005 7.37 11.85 1607 2005-2006 6.54 10.15 1551 2007-2008 8.02 13.82 1723 2008-2009 8.09 14.70 1817 2009-2010 7.16 12.99 1814 2010-2011 8.41 14.26 1695 Source:DES Ministry of Agriculture, Govt of India and Agriculture Statistics at

46 glance 2012 and State Agri/Hort. Departments Cardamom: Estimate by Spices board 2010-11: DASD, Calicut.

It is clear from the above table that there is fluctuating trends of area for dry chilli. It is varied from 8.36 lakh hectare in 2000-2001 to 8.41 lakh hectare in 2010-11. It is observed that the minimum dry chilli area is 6.54 lakh hectares in 2005-06 and maximum area is 8.80 lakh hectares in 2001-2002. It is clear from the above table that there is fluctuating trends of production for dry chilli too. It is varied from 9.84 lakh tonnes in 2000-01 to 14.26 lakh hectare in 2010-11. The production of dry chilli registered a minimum of 8.67 lakh tonnes in 2002-03 and a maximum of 14.70 lakh tones in 2008-09. Fluctuating trends can also be seen in yield per hectare per kg of dry chillies. It is varied from 1176 kgs in 2000-01 to 1695 kgs in 2010-11. The yield per hectare per kg of chilli registered a minimum of 1215 kgs in 2001-02 and a maximum of 1817 kgs in 2008-09. Karnataka Scenario Area, Production and Yield Per Hectare of Dry Chillies in Karnataka Karnataka is one of the major dry chillies producing states in the country. The details of the area, production and yield under the dry chilli crop, are provided in the following table.

47 Table No. 2.2 Area, Production andYield Per Hecter of Chilli in karnataka Year Area Production Yield per [in lakh [in lakh tonnes] hecters/kg hecters] 2001-2002 1.93 1.26 655 2002-2003 1.55 1.53 987 2003-2004 0.70 0.95 1352 2004-2005 1.52 1.05 687 2005-2006 1.26 1.07 850 2006-2007 1.33 1.30 1032 2007-2008 1.37 1.42 1092 2008-2009 1.22 1.35 1162 2009-2010 1.39 1.38 1048 Source:Fully revised estimates of Principal crops in karnataka for the year 2012

It is evident from the above table that it is varied from 1.93 lakh hectare in 2001-02 to 1.39 lakh hectares in 2009-10. It is observed that the minimum dry chilli area is 0.70 lakh hectares in 2003-04 and maximum area is 1.93 lakh hectares in 2001-02.

It is clear from the above table that the production of dry chilli is varied from 1.26 lakh tonnes in 2001-02 to 1.38 lakh hectare in 2009-10. The production of dry chilli registered a minimum of 0.95 lakh tonnes in 2003-04 and a maximum of 1.53 lakh tones in 2002-03.

Fluctuating trends can be seen in yield per hectare per kg of dry chillies. It is varied from 655 kgs in 2001-02 to 1048 kgs in 2009-10. The yield per hectare per kg of chilli registered a minimum of 655 kgs in 2001-02 and a maximum of 1352 kgs in 2003-04.

48 District Scenario Area, Production and Yield of Dry Chillies in Dharwad District: Dry chilles has been a major cash crop in the district of Dharwad which is part of the undivided old Dharwad district. The following table provides the details of the area production and yield of dry chilli in these newly formed districts. Table No. 2.3 Dharwad District Scenario Area, Production and Yield of Dry chillies in Dharwad District. Area, production and yield Per Hecter of Dry chillies. Year Area Production Yield in kgs [in hecters] [in tonnes] per hecters 2001-2002 65992 30865 468 2002-2003 56268 51598 917 2003-2004 21725 27699 1275 2004-2005 57559 26880 467 2005-2006 44299 23567 532 2006-2007 49262 29951 640 2007-2008 48915 28997 624 2008-2009 50974 37723 779 2009-2010 52794 25880 516 2010-2011 41230 18205 465 Source:Directorate of Economics & Stastics-Banlore. Fully revised Estimates of Principal Crops in Karnataka for the year 2012. It is evident from the above table that area of dry chilli in Dharwad district is varied from 659992 hectare in2001-02 to 41230 hectare in 2010-11. The minimum dry chilli area is 21725 hectare in 2003-04 and a maximum area is 65992 hectares in 2001-02. The production of dry chilli varied from 30865 tonnes in 2001-02 to 25880 tonnes in 2009-10. The production of dry chilli registered a minimum of 23567 tonnes in 2005-06 and a maximum of 51598 tones in 2002-03.

49 Fluctuating trends can also be seen in yield per hectare per kg of dry chillies. It is varied from 468 kgs in 2001-02 to 516 kgs in 2009-10. The yield per hectare per kg of chilli registered a minimum of 467 kgs in 2004-05 and a maximum of 1275 kgs in 2003-04. Navalgund Taluka Scenario Navalgund is one of the major chilli producing taluka place in Dharwad district. The details of the area under the chilli crop production and yield are provided in the following table. Table No.:-2.4 Navalgund Taluka Scenario Area, Production and Yield Per Hecter of Dry Chillies in Navalgund Taluka Year Area Production Yield in kgs [in hecters] [in tonnes] per hecters 2004-2005 11339 5840 515 2005-2006 8520 4984 585 2006-2007 8616 6065 704 2007-2008 11454 7857 686 2008-2009 16455 14102 857 2009-2010 19383 11009 568 2010-2011 12520 58218 465 Source:District Statistical office Dharwad. From 2004-05 to 2009-10 The details in the above table indicate that an overall trend of fluctuations with general moment of decline is the total area under dry chilly crop in Navalgund taluk during the period from 2004-05 to 2010-2011. The area under chilly crop varied from 11339 hecters in 2004-05 to 19383 hecters in 2009-10. The minimum area of 8520 hecters in 2005-06 and maximum of 19383 hecters in 2009-10. The production varied from 5840 tonnes in 2004-05 to 11009 tonnes in 2009-10. The minimum production of 4984 tonnes in 2005- 06 and maximum of 14102 tonnes in 2008-09. The yield per hecter varied from 515kgs in 2004-05 to 568kgs in 2009-10. The minimum yield per hecter is 515kgs in 2004-05 and a maximum of 857kgs 2008-09.

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50 CHAPTER – III PROFILE OF CHILLY –GROWING FARMERS COVERED BY THE STUDY

The analysis in this chapter pertains to a detailed profile of the farmers engaged in the production and marketing of chilly crop in the two Provincal Hobli villages in Navalgund taluk of Dharwad district. A total number of 200 farmers have been covered here for an intensive study of their production and marketing operations. A sample of 20 chilly growing farmers has been selected from each of the ten villages and weightage is given to large and small farmers among these selected 200 farmers. The profile covers information on the demographic characteristics like age and sex composition of the respondent farmers, their educational status, size of the family, occupational and income status, religious and caste affiliations, martial status, ownership of residential buildings, vehicles, livestock residential buildings, land ownership, nature of farming, type of soil, type of crops grown etc have studied. The details thus collected have been provided with necessary statistical data which provide the socio-economic background of the respondent farmers and the direct or indirect impact of these details on their farm and marketing operations etc. The statistical trends have been presented with suitable graphical representations wherever necessary to highlight the trends. Distribution of Sample Farmers According to their Farm Size The sample size of 200 respondent farmers consists of 120 large farmers and 80 small farmers from the ten villages of Navalgund taluk of Dharwad district. Hobli wise details of the large and small size farmers in the district are provided in the following table.

51 Table No.3.1 Distributuion of large and small farmers in the 2 Hobli village of Navalgund Taluka of Dharwad District. Hobli Large Pc Small Pc Total Pc A] ANNIGERI 1] Basapur 14 70 06 30 20 100 2] Bhadrapur 16 80 04 20 20 100 3] Hallikeri 07 35 13 65 20 100 4] Nalavadi 10 50 10 50 20 100 5] Saidapur 08 40 12 60 20 100 B] MORAB 1] Yamanur 13 65 07 35 20 100 2] Tirlapur 15 75 05 25 20 100 3] Shanwad 08 40 12 60 20 100 4] Shirakol 10 50 10 50 20 100 5] Halkusugal 08 40 12 60 20 100 TOTAL 109 54.50 91 45.50 200 100% Source: Field Survey

The selection of large and small farmers engaged in the production of chilly crops is based on their relative numerical strength in each of the five villages in two Hoblies in Navalgund taluka. Hence it is clear from the details in the above table that small farmers are relatively less in thefive villages of two Hoblies in Navalgund taluka in same order. However small farmers are found more inBasapur, Bhadrapur, Yamunur and Trilapur villages. Size of the land of the farmers has an impact on their income earning capacity and also on their capacity to retain their produce during times of falling prices. They cannot store

52 their produce due to lack of storage facilities. Their financial needs may force them to dispose of their produce locally at unremunerative prices and thereby suffer heavy losses. Age Composition of Farmers Details regarding the age composition of the 200 respondents provide some significant trends in the ten villages of two Hoblies in Navalgund taluk. Maximum number of 102 respondent farmers belonged to the advanced age group of 40 to 50 years followed by 72 farmers in the age group of 50 years and above and a minimum of 66 respondent farmers belonged to the age group of 30 to 40 years. The following table provides the details. Table No.3.2 Age composition of Farmers

Taluka 30 to Pc 40 to Pc 50 yrs Pc Total Pc 40 yrs 50 yrs above A] ANNIGERI 1] Basapur 05 25 11 55 04 20 20 100 2] Bhadrapur 11 55 07 35 02 10 20 100 3] Hallikeri 06 30 12 60 02 10 20 100 4] Navlavadi 06 30 11 55 03 15 20 100 5] Saidapur 04 20 10 50 06 30 20 100 B] MORAB 1] Yamanur 06 30 11 55 03 15 20 100 2] Tirlapur 10 50 06 30 04 20 20 100 3] Shanwad 07 35 12 60 01 05 20 100 4] Shirakal 05 25 09 45 06 30 20 100 5] Halkusugal 04 20 11 55 05 25 20 100 TOTAL 64 - 100 - 36 - 200 100 Source:Field Survey

The details in the above table indicate some contrasting trends. Maximum number of 06 respondents in saidapur of annigeri and shirkol of morab province are found and belonged to the age group of 50 years and above, followed by 12

53 farmers in Hallikeri and Shanwad in 40-50years age group and a minimum of 4 each in Saidapur and Halkusugal were in the age group of 30-40 years. Economically active population of farmers covered by the study is maximum. Farmers in the advanced age of 50 years and above are is also substantial. Age composition of the farmers has a bearing on the decision- making organizing and management in the production and marketing operations. Farmers in the younger age group have the advantage of physical mobility for contacting the market intermediaries, APMC and other organisations for obtaining information on modern techniques of production and production related operations and in obtaining information on marketing related aspects like demand, price and other aspects. Sex Composition of Farmers The information obtained from the selected 200 respondents indicated that all of them were male farmers engaged in the production and marketing of chilli in the 10 villages of Annigeri and Morab provinces of Navalgund taluk of Dharwad district. This trend is obviously in conformity with the traditional pattern of male oriented occupation of agriculture in the country. Educational Status of Farmers The educational status of the 200 farmers selected for the study in Dharwad district indicate some divergent trends both in relation to the level of education and in relation to each of the 10 villages of Annigeri and Morab provinces of Navalgund taluk of Dharwad district. It is significant to note that maximum number of 78 farmers had only secondary education followed by 71 farmers with primary education and 37 farmers with higher education. However 14 farmers had other type of educational background (i.e.. higher & others). The following table provides the details.

54 Table No. 3.3 Educational Status of Farmers Province Primary Pc Secondary Pc Higher Pc Other Pc Total Pc

A] ANNIGERI 1] Basapur 08 40 07 35 03 15 02 10 20 100 2] Bhadrapur 06 30 09 45 04 20 01 05 20 100 3] Hallikeri 05 25 11 55 03 15 01 05 20 100 4] Navlavadi 10 50 04 20 04 20 02 10 20 100 5] Saidapur 08 40 08 40 03 15 01 05 20 100

B] MORAB 1] Yamanur 06 30 07 35 05 25 02 10 20 100 2] Tirlapur 06 30 09 45 04 20 01 05 20 100

3] Shanwad 05 25 09 45 05 25 01 05 20 100 4] Shirakal 08 40 07 35 03 15 02 10 20 100 5] 09 45 07 35 03 15 01 05 20 100 Halkusugal TOTAL 71 - 78 - 37 - 14 - 200 Source:Field Survey

It is clear from the details in the above table that maximum number of 10 respondent farmers in Navadi village had primary education followed by 09 farmers in Halkusugal and 08 farmers each in Basapur, Saidapur and Shirkol of two Hoblies in Navalgund taluk. Hallikeri with 11 farmers had maximum number of respondents with secondary education followed by Basapur, Trilapur, Shanwad villages with 09 farmers each in two Hoblies ofNavalgund taluka. The maximum number of 05 respondent farmers each in Yamanur and

55 Shanwad villages had higher education followed by 4 farmers each in Bhadrapur, Nalavadi and Tirlapur of two Hoblies in Navalgund taluk. Basapur, Nalavadi, Yamanur and Shirkol villages had 02 farmers each with other educational qualification followed by remaining five villages with 01 farmer each in the two hoblies of Navalgund taluk.

Educational status has its impact on the efficiency and the quality of performance of operations in agriculture as in any other type of industry or occupations. The above details indicate that the majority of respondent farmers had primary or secondary education which naturally had good impact on their occupational efficiency. It is an encouraging factor to note that none of the 240 selected respondent farmers were found to be illiterate. Size of the Farmers’ Families The total number of male members of the552 farmers are in 10 villages of Annigeri and Morab Provinces of Navalgund taluka of Dharwad district. While the total number of female members was 496. The total number of children of the 404 are selected from farmers of the each of 10 villages of Annigeri and Morab provinces of Navalgund taluk of Dharwad district.. The following table provides the details.

56 Table No. 3.4 Size of Families of the Farmers Province Male Pc Female Pc Children Pc Total Pc ANNIGERI 296 53.62 286 57.66 210 51.98 792 54.55 MORAB 256 46.38 210 42.34 194 48.02 660 45.45 TOTAL 552 100 496 100 404 100 1452 100 Source:Field Survey Caste wise Distribution of farmers Caste wise distribution of the 200 selected farmers indicate that maximum number of 155 respondents belonged to castes which are included in General Merit Categories as per Government rules followed by 20 farmers belonging to scheduled castes, 11 farmers belonging to scheduled Tribes and 14 farmers belonging to the other categories. The following table provides the details. Table No.3.5 Caste wise Distribution of Farmers Province SC Pc ST Pc GM Pc Others Pc Total ANNIGERI 09 45 05 45.45 80 51.61 06 42.86 100 MORAB 11 55 06 54.55 75 48.39 08 57.14 100 TOTAL 20 100 11 100 155 100 14 100 200 Source:Field Survey

Occupational Pattern of Farmers It is significant to note that the occupation of all the 200 selected farmers was agriculture. The following table provides the details.

57

Table No. 3.6 Occupational Pattern of Farmers Province Agriculture Pc Non- Pc Total Agriculture ANNIGERI 100 100 - - 100 MORAB 100 100 - - 100 TOTAL 200 100 - - 200 Source:Field Survey

Income Status of farmers Maximum number of 156 farmers covered by the study had an annual income of Rs.50000 or below it. A smaller number of 31 respondent farmers had an annual income of Rs.50000 to Rs.100000. A still smaller number of 13 respondent farmers had an annual income of Rs.100000 and above. The following table provides the details Table No.3.7 Income Status of Farmers Province 50000 Pc 50000 Pc 1 lakh & Pc Total Below to 1 above lakh ANNIGERI 76 48.72 16 51.61 08 61.54 100 MORAB 80 51.28 15 48.39 05 38.46 100 TOTAL 156 100 31 100 13 100 200 Source: Field Survey The details in the above table indicate that 156 farmers in two provinces comprising ten villages had an annual income of Rs.50,000 or less followed by 31 farmers in the income of Rs50,000 to Rs.1lakh followed by 13 farmers in the income group of Rs. 1 lakh and above. The income status of the maximum number of 156 respondent farmers is very low since their annual income is less than Rs.50000. With such low income their capacity to maintain a decent living is limited. More over their ability to

58 improve their farm operations too is constrained by such meager income. Such meager income in the wake of rising input cost in their agriculture gets eroded further. A further discouraging factor is that all the 240 respondent farmers depend on their agriculture alone and they don‟t have any other source of income. Fixed Assets of the Farmers The respondent farmers owned residential buildings, vehicles, livestock and lands etc. indicating their investments in such assets. The following analysis provides the details of these assets of the 200 selected farmers in the study area. Residential House All the 200 sample farmers owned their residential houses except 4 farmers in Annigeri and Morab provinces who stayed in a rented house. The following table provides the details. Table No.3.8 Residential Houses of Farmers Province Owned Pc Rented Pc Farm Pc Total House ANNIGERI 95 49.74 02 50 03 60 100 MORAB 96 50.26 02 50 05 40 100 TOTAL 191 100 04 100 05 100 200 Source:Field Survey Livestock of the farmers All the respondent farmers owned three types of livestock viz. Bullocks, Cows and Buffaloes. Maximum number of 338 bullocks was owned by the 200 farmers covered by the study. The number of cows and buffaloes owned by them was 254 and 164 respectively. The following table provides the details.

59 Table No.3.9 Livestock Assets of the Farmers Province Bullocks Pc cows Pc Buffaloes Pc Total ANNIGERI 190 48.97 130 51.18 106 64.63 426

MORAB 198 51.03 124 48.82 58 35.37 380 TOTAL 388 100 254 100 164 100 806

Source:Field Survey

The 100 respondent farmers in Annigeri had the maximum number of 190 bullocks followed by farmers in Morab province 198 Bullocks. Farmers in Annigeri province again led others with 130 cows followed by farmers in Morab with 124 cows. Farmers in Annigeri province again led others with maximum of 106 buffaloes followed by farmers in Morab province with a maximum of 58 Buffaloes. The practice of owning livestock by the agricultural families is common feature in India since there is a good deal of complementarity between agricultural operations and animal husbandry. Vehicles of Farmers Transport facilities are essential for any productive activities and agriculture is no exception to this. Transport needs of agriculture relate to carrying of agricultural implements and agricultural inputs to the land sites and for taking back the fodder and the agricultural produce to the residences or to the market place. Every farmer will own one type of transport vehicles or the other. The respondents covered by the study have indicated three type of vehicles owned by them. The following table provides the details.

60 Table No. 3.10 Vehicles of Farmers Province Cart Pc Tractors Pc Two Pc Others Pc Total wheelers ANNIGERI 65 46.43 50 43.48 75 51.72 150 46.15 340 MORAB 75 53.57 65 56.52 70 48.28 175 53.85 385 TOTAL 140 100 115 100 145 100 325 100 725 Source: Field Survey The details in the above table indicate that the 100 respondent farmers in the five villages of Annigeri province owned 65 carts, 50 tractors, and 75 two wheelers. There were a total number of 340 vehicles owned by these 100 respondent farmers. The 100 respondent farmers in Morab province have owned 75 cart,65 tractors and 70 two wheelers and others in the both provinces are 325 in total. Lands Owned and Rented by Farmers The farmers in the 10 villages covered by the study in the Navalgund taluk have owned lands and and some farmers had been cultivating rented lands too. However, no respondent farmers (20 each) in the villages of Navalgund taluka were not cultivating rented lands. The following table provides the details. Table No. 3.11 Owned and Rented Lands of Farmers Province Types of Acres Pc No. of land Farmers A] ANNIGERI 1] Basapur Owned 280 75.27 20 Rented 92 24.73 2] Bhadrapur Owned 320 86.49 20 Rented 50 13.51 3] Hallikeri Owned 250 69.44 20 Rented 110 30.56

61 4] Navlavadi Owned 350 81.40 20 Rented 80 18.60 5] Saidapur Owned 315 76.83 20 Rented 95 23.17 Total Owned 1515 100 Rented 427 B] MORAB 1] Yamanur Owned 320 76.19 20 Rented 100 23.81 2] Tirlapur Owned 360 75.00 20 Rented 120 25.00 3] Shanwad Owned 330 78.57 20 Rented 90 21.43 4] Shirakal Owned 300 80.00 20 Rented 75 20.00 5] Owned 345 83.13 20 Halkusugal Rented 70 16.87 TOTAL Owned 1655 100 Rented 455 Source:Field Survey The 200 respondent farmers in 10 villages of Navalgund taluk cultivated a total of 4052 acres of land. Province wise 20 farmers each covered by the study in Annigeri province owned and cultivated maximum of 350 acres of land followed by 20 farmers each in Annigeri province cultivating 1515 acres owned land and 427 acres rented land, where as the farmers in Morab province owned and cultivated 1655 acres of land and rented land of 455 acres. The above details clearly indicate that the farmers have been cultivating largely their own land and only marginally ther are cultivating rented land. Irrigated and Non-Irrigated Land of Farmers The responses and the data provided by the 200 farmers indicate that all part of the land cultivated by them is non irrigated. The non irrigated part of their land ranged from a minimum of 360 acres in case of Hallikeri farmers in Annigeri province and the maximum of 480 acres in case of Tirlapur farmers of Morab province. The following table provides the details.

62 Table No. 3.12 Irrigated and Non-Irrigated Lands of Farmers

Province Types of Acres Pc Total land A] ANNIGERI 1] Basapur Irrigated - - - Non- 372 100 20 Irrigated 2] Irrigated - - - Bhadrapur Non- 370 100 20 Irrigated 3] Hallikeri Irrigated - - - Non- 360 100 20 Irrigated

4] Irrigated - - - Navlavadi Non- 430 100 20 Irrigated 5] Saidapur Irrigated - - - Non- 410 100 20 Irrigated TOTAL Irrigated - - - Non- 1942 - 100 Irrigated B] MORAB 1] Yamanur Irrigated - - - Non- 420 100 20 Irrigated 2] Tirlapur Irrigated - - - Non- 480 100 20 Irrigated 3] Shanwad Irrigated - - - Non- 420 100 20 Irrigated 4] Shirakal Irrigated - - - Non- 375 100 20 Irrigated

63 5] Irrigated - - - Halkusugal Non- 415 100 20 Irrigated TOTAL Irrigated - - - Non- 2110 - 100 Irrigated

It is evident from the details in the above table that the farmers of Annigeri province had 1942 acres of land with non irrigated followed by the farmers in Morab province who had 2110 acres of non irrigated land. The total non irrigated land is 4052 acres in the entire Navalgund taluk . It is clear from the above table that the farmers of Annigeri province had maximum of 410 acres of land with non irrigation followed by the farmers in Morab province who had 480 acres of non irrigated land. Thus the total land utilized for growing the chilly crops and other crops is 4052 acres.

Type of Land Cultivated by Farmers The 100 farmers in Annigeri province covered by the study had maximum of land with black soil 1942 acres followed by the farmers in Morab province with 2110 acres of black soil. No farmers in province of the taluk was covered by the red soil. The total land of black soil is 4052 acres. The following table provides the details Table No.3.13 Type of land cultivated by Farmers Province Types of Acres Pc Total land A] ANNIGERI 1] Basapur Black soil 372 100 20 Red soil - - -

2] Bhadrapur Black soil 370 100 20 Red soil - - -

64 3] Hallikeri Black soil 360 100 20 Red soil - - -

4] Navlavadi Black soil 430 100 20 Red soil - - - 5] Saidapur Black soil 410 100 20 Red soil - - - TOTAL Black soil 1942 - 100 Red soil - -

B] MORAB 1] Yamanur Black soil 420 100 20 Red soil - - - 2] Tirlapur Black soil 480 100 20 Red soil - - - 3] Shanwad Black soil 420 100 20 Red soil - - - 4] Shirakal Black soil 375 100 20 Red soil - - - 5] Black soil 415 100 20 Halkusugal Red soil - - - TOTAL Black soil 2110 - 100 Red soil - - Source:Field Survey

It is clear from the above table that 20 farmers each in the villages of Annigeri province covered by the study owned a maximum of 430 acres of black soil in Nalavadi followed by the farmers in Saidapur with 410 acres,

65 Basapur with 372 acres, Bhadrapur with 370 acres and Hallikeri with 360 acres. The farmers in Morab province covered by the study owned a maximum of 480 acres of black soil in Tirlapur followed by farmers in Yamanur and Shanwad with 420 acres each and Halkusugal and Shirkol with 415 acres and 375 acres respectivelys. The type of the soil has its own impact on the pattern of crops grown on the same. Hence this pattern of soil of the land of the farmers has a direct impact on the farm operations. Crop Pattern in Different Talukas The data collected from the respondent farmers in the ten villages of Navalgund taluka shows some significant trends about the type of crops grown by them. The total area under the cash crops in the ten villages of Navalgund taluka belonging to 200 farmers covered by the study was 4052 acres. This is the maximum area under cash crop grown by the respondent farmers in the taluk. The area under crops grown by the 200 respondent farmers in the taluka were Dry chilly [1760 acres], Cotton [904 acres], Ground Nut [838], Wheat [303acres] and Jowar [247 acres]. These details indicate that the respondent farmers have devoted maximum area of their lands for growing dry chilly compared to other crops. The remunerative price and the higher income from this crop have been the major factors leading to the maximum area devoted for this commercial crop. Cotton which is the major commercial crops grown by the farmers in the noth Karnataka which is more suitable for the black soil for cultivation. This accounts for the second largest area of the lands owned by the respondent farmers in the study area followed by ground Nut [838 acres], Wheat [303 acres] and Jowar [247 acres]. The following table provides the details of the land area of the respondent farmers in the ten villages of Navalgund taluka under different crops.

66

Table No. : 3.14 [table to be inserted] A) ANNIGERI Gro No. Cott un Wh Jaw of Province Land Chilly Pc Pc Pc Pc Pc on d eat ar farm nut ers 1] Basapur Acres-372 172 46.24 74 19.89 75 20.16 29 7.80 22 5.91 20 Irrigated ------Non-Irrigated 172 46.24 74 19.89 75 20.16 29 7.80 22 5.91 2] Bhadrapur Acres-370 151 40.81 74 20.00 79 21.35 37 10.00 29 7.84 20 Irrigated ------Non-Irrigated 151 40.81 74 20.00 79 21.35 37 10.00 29 7.84 3] Hallikeri Acres-360 144 40.00 82 22.78 74 20.56 32 8.88 28 7.78 20 Irrigated ------Non-Irrigated 144 40.00 82 22.78 74 20.56 32 8.88 28 7.78 4] Nalavadi Acres-430 206 47.91 87 20.23 95 22.10 25 5.81 17 3.95 20 Irrigated ------Non-Irrigated 206 47.91 87 20.23 95 22.10 25 5.81 17 3.95 5] Saidapur Acres-410 180 43.90 86 20.98 83 20.24 33 8.05 28 6.83 20 Irrigated ------Non-Irrigated 180 43.90 86 20.98 83 20.24 33 8.05 28 6.83 B) MORAB Gro No. Cott un Wh Jaw of Province Land Chilly Pc Pc Pc Pc Pc on d eat ar farm nut ers 1] Yamanur Acres-420 177 42.14 96 22.86 97 23.10 29 6.90 21 5.00 20 Irrigated ------Non-Irrigated 177 42.14 96 22.86 97 23.10 29 6.90 21 5.00 2] Tirlapur Acres-480 216 45.00 107 22.29 105 21.88 28 5.83 24 5.00 20 Irrigated ------Non-Irrigated 216 45.00 107 22.29 105 21.88 28 5.83 24 5.00 3] Shanwad Acres-420 162 38.57 101 24.05 87 20.71 37 8.81 33 7.86 20 Irrigated ------Non-Irrigated 162 38.57 101 24.05 87 20.71 37 8.81 33 7.86 4] Shirakol Acres-375 161 42.94 110 29.33 71 18.93 18 4.80 15 4.00 20 Irrigated ------Non-Irrigated 161 42.94 110 29.33 71 18.93 18 4.80 15 4.00 5] Halkusugal Acres-415 191 46.02 87 20.96 72 17.35 35 8.44 30 7.23 20 Irrigated ------Non-Irrigated 191 46.02 87 20.96 72 17.35 35 8.44 30 7.23 TOTAL 4052 1760 43.44 904 22.31 838 20.68 303 7.48 247 6.09 200

67 The province wise data indicate that area under chilly crop of the 20 farmers each in Nalavadi and Tirlapur village was the maximum of 206 acres and 216 acres respectively in the entire Navalgund taluk. The next village with highest area of land under chilly crop was Halkusugal where the 20 respondents farmers cultivated a chilly crop on 191 acres under non irrigated land. Farmers in Saidapur and Yamanur villages had cultivated a chilly crop on 180 acres and 177 acres respectively. Chilly was grown relatively at a smaller area of 144 acres in Hallikeri village by 20 respondent farmers. Cotton is the another major oil seed crop grown in the Navalgund taluk by the respondent farmers.20 each respondent farmers had cultivated a maximum area of cotton in Shirkol with 110 acres of land followed by the farmers in Tirlapur, Shanwad, Yamanur, Halkusugal and Saidapur with 107, 101, 96, 87and 86 acres respectively of two Hoblies in the entire Navalgund taluk. Cotton was grown relatively at smaller area of 74 acres each in Basapur and Bhadrapur villages.

The respondent farmers growing groundnut have been using part of their lands for growing food crops like Wheat and Jowar. Next only to 838 acres of land used for growing groundnut. Area under Wheat is also substantial of 303 acres while area under Jawar is only 247 acres. Groundnut is grown by 200 respondent farmers in two province of entire Navalgun talukof which farmers in Tirlapur cultivated a mximum ares of 105 acres followed by the farmers in Yamanur 97 acres, Nalavadi 95 acres, Shanwad 87 acres ,Saidapur 83 acres Bhadrapur 79 acres, Basapur 75 acres, Hallikeri 74 acres, Halkusugal 72 acres. The minimum area of land cultivated for groundnut crop in the entire Navalgund taluk is 71 acres in Shirkol village. Wheat is grown by the 100 respondent farmers in Annigeri province with a maximum area of 37 acres in Bhdrapur and a minimum of 25 acres in Nalavadi villages, on the contrary with a maximum area of 37 acres in Shirkol

68 and a minimum of 18 acres in Shirkol villages. Jawar is grown by the 200 respondents farmers in the two Hoblies of the entire Navalgund taluk in a maximum area of 33 acres in Shanwad village and a minimum area of 15 acres in Shirkol village both are belongs to Morab province in Navalgund taluk. However the maximum and minimum area of Jawar in Annigeri province is 29 acres and 17 acres in Bhdrapur and Nalavadi villages respectively. The above analysis reveals that the farmers covered by the study area have been engaged in growing more than one crop on their lands and the chilly crop accounts the maximum area of their total land as compared to the area provided for growing cotton Groundnut, wheat and jawar crops in the entire Navalgund taluk of the Dharwad district.

69 Profile of APMCs and the Market Intermediaries operating in the study area: Annigeri Agricultural Produce Market Committee: [Main APMC Head office of Navalgund Taluka] The APMC was established under the Bombay Agriculture Produce Market Act of 1939 on 05-02-1948 and has been functioning well for the last 60 years and has its jurisdiction over the Navalgund taluka at 59 villages and 149746 hectares of cultivable area. The APMC has 4 sub-markets i.e. in Navalgund, Morab, Shelavadi and Hebbal. The Annigeri APMC is located on an area of 25.03 acres and its sub-markets are located on an area as under: Sub-markets Area Navalgund 14.29 Acre Morab 10.00 ‟‟ Shelavadi 05.00 ‟‟ Hebbal 10.38 ‟‟

Regulated Agricultural Produce: The APMC has a total of 113 Regulated Agricultural Produce including Animal Husabandry-Livestock Goat Sheeps. The APMC has covered under the Regulated Agricultural Produce, Cotton, Ginned Cotton, Wheat, Jowar, Maiz and Dry Chilies as major agricultural produce. Sale procedure of Regulated produces: The details of sale procedure of regulated produce are given in the following table.

70 Table3.15 Sale Procedure of Regulated Produce Sl. No. Produce Method of sale Tender system and 1 Cotton, Ginned Cotton. Auction system 2 Dry chilies, Jowar, Maiz, Wheat Mutual agreement 3 Live stock, Goats and sheeps Mutual agreement

Source: APMC Annual Report 2011-12 Market Cess, Licence fees and other incomes: The details of Market Cess, Licence fees and other incomes collected by the Annigeri APMC during the five years from 2007-08 to 2011-12 are provided in the following table.

Table3.16 Market Cess, Licence fees and other fees collected by the Annigeri APMC (in rupees) Year Market cess Licence fees Other fees Total 2007-2008 12900000 32100 2000.00 12934100 2008-2009 4304701 34795 247026 4586522 2009-2010 10176804 54459 345768 10577031 2010-2011 13264591 50250 674243.32 13989084.32 2011-2012 12184704 62420 742338 12989462 Source: APMC annual report 2011-12 Market Cess collections have varied from Rs. 12900000 in 2007-08 to Rs. 12184704 in 2011-12. The receipts from license fees have fluctuated from 2007-08 to 2011-12. Other fees collected by Annigeri APMC have also fluctuated from 2007-08 to 2011-12.

71 Financial position: The details of financial position of Annigeri APMC during 2009-10 to 2011-12 are provided in the following table

Table3.17 Income and Expenditure and Savings of Annigeri APMC (in rupees) Years Income Expenditures Savings 2009-2010 10577027 7351288 3225739 2010-2011 13989084.32 9193146 4795938 2011-2012 12989462 9169191 3820271

Source: APMC Annual Report 2011-12 The total income of the Annigeri APMC reached its maximum level in 2010- 2011 but went down to a minimum level of Rs. 10577027 in 2009-10. Expenditure of the APMC reached its maximum of Rs.9193146 in 2010-11 and was the minimum of Rs. 7351288 in 2009-2010. Savings were the highest at Rs. 4795938 in 2010-11. Arrivals of Major Agricultural Produce at Annigeri APMC: The details of arrivals of major agricultutal produce at Annigeri APMC from 2009-10 to 2011-12 are given in the following table.

72 Table3.18 Arrival of major Agricultural Produce at Annigeri APMC

Agri products 2009-2010 2010-2011 2011-2012 Sl. No. Arrivals Rate Value Arrivals Rate Value Arrivals Rate Value 1 Cotton Jayadhar 36264 2350 85220400 30157 2600 78408200 23797 3820 90904540 Ginned cotton 2 2518 5525 13911950 3450 6300 21735000 2418 8160 19730880 Jayadhar 3 Dry chillies 1773 10500 18616500 2873 800 22984000 2309 10000 23090000 4 Maize 561143 840 471360120 437451 840 367458840 254397 980 249309060 5 Onion NIL NIL NIL 75 610 45750 NIL NIL NIL 6 Sunflower 611 2300 1405300 3444 2225 7662900 2267 21867 6499489 7 Jowor 115 700 80500 NIL NIL NIL 20 650 53000 8 Wheat 13974 1400 19563600 6331 1385 8768435 15040 1230 18499200 9 Hesaru 473 4250 2010250 17 3400 57800 NIL NIL NIL 10 Gram 10004 2130 21308250 11576 1950 22573200 7042 2500 17605000 11 B.T.Cotton 11778 3250 38278500 45798 4000 183192000 53947 3895 208505155 Ginned 12 1036 600 7044800 20086 7000 140602000 5677 9000 51093000 B.T.Cotton 13 Cotton seeds NIL NIL NIL 1567 1000 1567000 2564 1300 3333200 Source: APMC Annual Report 2011-2012 Market Intermediaries in Annigeri APMC: There were good number of market intermediaries in the Annigeri APMC also which consisting of commission agents, purchasers and others. The total number of these market intermediaries went up from 459 in 2009-10 to 600 in 2011-12. The following table provides the details. Table3.19 Market Intermediaries in Annigeri APMC (No. of persons) Sl. Commission Years Purchasers Others Total No. Agents 1 2009-2010 13 49 397 459 2 2010-2011 13 65 517 595 3 2011-2012 15 76 509 600

Source: APMC Annual Report 2011-12

73 Table3.20 Production of Dry Chilly, sales quantity and value sl.no Years Production[in Sales[in Value[in Qty] Qty] Rs] 1 2009-2010 1773 1773 18616500 2 2010-2011 2873 2873 22984000 3 2011-2012 2309 2309 23090000 Source:ibid

The total sales value of Annigeri APMC reached it`s maximum level in 2011-2012 but went down to a minimum level of Rs.18616500 in 2009-2010.

Developmental Works on the APMC Campus: The APMC has provided various facilities on its premises at Annigeri. The major works includes Sales Bhavan, Office Building, Raita Bhavan, Livestock Yard, Water facility for Livestock, Roads within the market yard, Canteen, Warehouse, Auction Platform, Electricity, Platform for drying the produce, Latrine, Drainages etc,. Other Programmes: The APMC has introduced “ Raita Sanjeevani Accident Insurance Plan” for thye benefit of the farmers and has distributed insurance compensation to the farmers to a tune of Rs. 641000/- till today. The APMC has informed and advertised for availing the benefit of „Mortagaged Loan Plan‟ for all the formers coming under the jurisdiction at APMC yard and Rs. 2,15,500/-. Fund is kept reserved for the said plan during the year 2001-02. The APMC has also distributed insurance amount of Rs. 1,50,000/- under the “Hamals Insurance Scheme” to seven persons during the corresponding period.

74 The APMC has provided link roads connecting villages with the help of PWD. It has acquired a land of 5 acres and 10 acres for Shelavadi sub-market extension and Morab sub-market extension respectively during the corresponding period. Profile of Market Intermediaries: The study covered a total number of 10 market intermediaries in the Navalgund taluk of APMC in Dharwad district. The details of the number market intermediaries in the taluka have been provided in the following table. Table No.3.21 Market Intermediaries in Navalgund taluka Sl. NO. Taluka No. of Market Intermediaries 1 Navalgund 10 Source – Field Survey Age Composition of Intermediaries: The data collected from the respondent market intermediaries revealed that all the 10 intermediaries are in the Navalgund taluk among them 3 respondents were in the age group of 25-50 years and the 7 respondents were in the age group of 50 years and above. The following table provides the details. Table No.3.22 Age Composition of Intermediaries Sl. 25 to 50yrs & Taluka Percent Percent Total Percent No. 50 yrs above 1 Navalgund 03 30 07 70 10 100

Source: Field Survey Educational Status: The educational status of the respondents indicates that 02 intermediaries had Secodary education, 08 intermediaries were degree holders. The following table provides the details.

75 Table No.3.23 Educational Status Primary Secondary Degree SlNo. Taluka Total Education Education Holders 01 Navalgund NIL 02 08 10

Source: Field Survey

It is clear from the above table that 8% of intermediaries covered by the study were degree graduates. But no intermedriaries were belongs to primary education.

Religious Affiliations of Intermediaries: The information obtained during the field survey indicates that maximum number of 08 respondent market intermediaries were Hindus. While only 02 respondents belongs to the Muslim religion. Caste Affiliations: It is found through personal interview that zero respondent market intermediaries belonged to scheduled tribes while majority of 09 market intermediaries belonged to „general‟ categories and 01 respondents belonged to other caste groups. The following table provides the details. Table No.3.24 Caste Affiliations of Market Intermediaries Sl. No. Taluka SC ST General Others Total 1 Navalgund - - 09 01 10 Source: Field Survey Major Occupation: All the 10 market intermediaries in the Navalgund taluks of Dharwad district have asserted that their major occupation was trade.

76 Types of Intermediaries: It is gathered from the personal interview that all the 10 intermediaries in Navalgund taluka were commission agents. However 03 of them also worked as wholesale merchants. Similarly 07 respondents were retail merchants while five of them also worked as commission agents. Duration of working as Intermediaries: Majority of 07 respondent market intermediaries have been working for the last 5 to 10 years however 03 respondents have been engaged in the profession for 10 to 15 years. The following table provides the details. Table No. 3.25 Duration of Working as Market Intermediaries More Sl. 5 to 10 10 to 15 Taluka than 15 Total No. years years years 1 Nvalgund 07 03 NIL 10 Source: Field Survey Working in the APMC: All the 10 respondent market intermediaries are working in the respondent APMCs and further all of them are holding licences from their APMCs. Services Rendered to Dry Chilly Farmers: The responses obtained from the market intermediaries indicate that they help in obtaining storage facilities, packing services, transport facilities, grading and market information to the farmers. The following table provides the data.

Table No.3.26 Services Rendered to Farmers by the Market Intermediaries (Number of Respondents) Market Storage Packing Transport Grading Taluka information Owned Arranged Owned Arranged Owned Arranged Owned Arranged Owned Arranged Navalgund 05 06 04 05 04 05 03 07 08 02 Source: Field Survey It is clear from the details in the above table that many market intermediaries arrange for the services in addition to owing the same.

77 Sales Arrangements for the Farmers: It is mentioned by all the 10 respondent market intermediaries in the Navalgund taluka Dharwad district that they provide all the market information to the dry chilly farmers relating to demand price and the quantity of dry chillies required by the buyers. This would enable the farmers to affect the sales of their dry chillies through the services of the market intermediaries. Nature of Competition among the Intermediaries: The respondent of the market intermediaries indicate that the competition in their profession is normal and minimum. The Main Buyers of Cash crops: The respondent‟s responses about the main buyers of cash crops are indicated in the following table. Table No.3.27 Main Buyers of Dry Chillies (Percent) Seed Seed Sl. No. of Mills Taluka cost Merchants Total No. middleman Percent Percent Percent 1 Navalgund 10 65 20 15 100

Source: Field Survey It is clear from the details in the assbove table that 65 percent of the purchases are made by mills while other companies and seed merchants accounts for 15% and seed cost percentage 20. All the 10 market intermediaries are unanimous in their opinion on this aspect. Sale and Payment Arrangement: The respondent market intermediaries have asserted that they arrange for immediate sale and immediate payment to the dry chilly farmers. Price Determination: The respondent market intermediaries are unanimous in their opinion that the price of Dry chill is determined by the buyers and especially by mills. ********

78 CHAPTER – IV PRODUCTION DIMENSIONS OF CHILLY IN NAVALGUND TALUKA

The discussion in this chapter is focussed on the production dimensions of chilly in the study area comprising of ten villages in two provinces of Navalgund taluka of Dharwad district. It is expedient to discuss the production dimensions since they have a direct bearing on the marketing of the product relating to volume supply cost and prices. The different aspects covered by the discussion on the production of Dry chilly include the area covered by the chilly crop during the five years in the ten villages in two provinces of Navalgund taluka of the Dharwad district, quantity of the produce during the corresponding period and the yield per acre which indicates the productivity of the land in relation to the chilly crop. Other aspects of production dimensions of chily crop relate to the cost of production in terms of the various components viz., tilling and manuring cost, cost of sowing, cost of cleaning of the crop, cost of crop cutting, cost of harvesting, cost of inputs like seeds, manure, water etc,. In addition to these the other costs relating to infrastructure cost like, transport cost, electricity cost, rentals for harvesting, salary of regular workers etc. are discussed. The discussion under the production dimensions includes other aspects like investment in land, ownership of vehicles agricultural implements. Financial involvement in relation to production activities and the production technology influencing production and the employment aspects are the major areas discussed in the chapter.

79 Area, Production and Yield of Chilly crop in Navalgund taluka: The area under chilly crop of the 200 farmers in the ten villages in two provinces of Navalgund taluka Dharwad district has remained almost stable during the seven years from 2003-04 to 2009-10. The details of the area, production and yield per hectare of chilly crop in two provinces of Navalgund taluka in Dharwad district are indicated in the following table.

Table No. : - 4.1 Area, output and yield per hecter of Dry chilly in Navalgund taluk province Year Land Annigeri Morab 2003-2004 Area Acres 661 755 Output[Quintals] 1784.7 2151.75 Yield per acres/kg 270 285 2004-2005 Area Acres 628 740 Output[Quintals] 1620.24 1998 Yield per acres/kg 258 270 2005-2006 Area Acres 635 725 Output[Quintals] 1854.2 2030 Yield per acres/kg 292 280 2007-2008 Area Acres 620 731 Output[Quintals] 2188.6 2616.98 Yield per acres/kg 342 358 2008-2009 Area Acres 629 738 Output[Quintals] 2698.41 2590.38 Yield per acres/kg 429 435 2009-2010 Area Acres 665 750 Output[Quintals] 1895.25 2160 Yield per acres/kg 285 288 Source: Field Survey The total area under chilly crop of the 200 respondent farmers in the 10 villages of two provinces of Navalgund taluk has remain almost stable during the 7 years from 2003-04 to 2009-10.The total area under chilly crop of 100 farmers varied from a minimum of 620 acres in 2006-07 to a maximum of 665

80 acres in 2009-10 in the Annigeri province of Navalgund taluk. However it is varied from a minimum of 721 acres in 2008-09 and a maximum of 755 acres in 2003-04 in Morab province of the Navalgund taluk. Province wise output of chilly crop of 100 respondent farmers in Annigeri province varied from a minimum of 1620.24 quintals in 2004-05 to a maximum of 2698.41 quintals in 2008-09. However the output of Morab province varied from a minimum of 1998 quintals in 2004-05 to a maximum of 3136.35 quintals in 2008-09 in the Navalgund taluk. It is significant to note that the output of chilly crop in all the two provinces has declined continuously during the first 3 years. The yield per hecter of dry chilly of the 200 respondent farmers in all the two provinces of Navalgund taluk shown a similar trend of decline during the first 3 years from 2003-04 to 2005-06, but a steep rise in the fourth year is noticed during 2006-07. The yield per hecter of dry chilly in Annigeri province varied from a minimum of 258kgs in 2004-05 and a maximum of 429 kgs in 2008-09. However it is varied from a minimum of 270kgs in 2004-05 and a maximum of 435kgs in 2008-09 in the Morab province of Navalgund taluk. It is noticed that the yield per hecter of dry chilly has been more in Morab province as compared to Annigeri province that is 435kgs per hecter in 2008-09 in the two Hoblies of the Navalgund taluk in Dharwad District. Cost of Production: The data collected from the respondent farmers in the study area has revealed some significant trends about the different costs associated with the production of chilly crop. These different costs relate to the tilling of the land, manuring, cleaning of the cropped area, sowing, crop cutting and harvesting. The input costs relate to the cost of seeds, water and electricity used and manure. Other costs related to production include vehicles maintenance, rentals of harvesting machines and salary of regular workers. The following analysis

81 provides the details of the field investigation about the costs of production of Dry chilly. Cost of Tilling and Manuring (Labour Cost): The cost ranges mentioned by the respondent farmers are Rs. 750 or less, Rs.750 to Rs.1500 and Rs.1500 and above per acre. The cost of tilling and manuring of an acre of land for chilly crop ranged between Rs.750 and below in case of 8 respondent, between Rs.750 to Rs.1500 in cases of 49 and Rs.1500 and above in case 43 farmers in Annigeri province. While in Morab province the cost ranged between below Rs.750 cases are 8 respondents, between Rs.750 to Rs.1500 cases are 45 respondents, Rs.1500 and above are 47 farmers. The above details are mentioned in the following table. Table No. : - 4.2 Cost of Tilling and managing of one acre of land Province Crop Rs750 Pc Rs750 Pc Rs15000 Pc Total Pc below to Rs above 15000 A] ANNIGERI

1] Basapur Chilly 02 10 11 55 07 35 20 100 2] Bhadrapur Chilly 01 05 09 45 10 50 20 100 3] Hallikeri Chilly 01 05 08 40 11 55 20 100 4] Navlavadi Chilly 02 10 09 45 09 45 20 100 5] Saidapur Chilly 02 10 12 60 06 30 20 100 TOTAL 08 49 43 100 B] MORAB

1] Yamanur Chilly 01 05 12 60 07 35 20 100 2] Tirlapur Chilly 02 10 10 50 08 40 20 100 3] Shanwad Chilly 01 05 08 40 11 55 20 100 4] Shirakal Chilly 02 10 06 30 12 60 20 100 5] Halkusugal Chilly 02 10 09 45 09 45 20 100 TOTAL 08 - 45 - 47 - 100 - Source: Field Survey

82 Cost of Sowing: Maximum numberof respondent farmers in the ten villages of two provinces of Navalgund taluka has mentioned that the labour cost of sowing of chilly per acre varied between Rs.200 and Rs.400. However 32 and 36 farmers each in Annigeri and Morab province mentioned that the per acre sowing cost chilly was Rs.200 or less. It is significant to note that 59 and 57 farmers each in Annigeri and Morab province mentioned that the sowing cost of chilly was Rs.200 to Rs.400 and 09 and 07 farmers each in Annigeri and Morab province have mentioned the sowing cost of Rs.400 and above. The details are shown in the table. Table No. : - 4.3 Cost of sowing chilly crop per acre Province Crop Rs200 Pc Rs200 to Pc Rs 400 Pc Total Pc Below Rs400 above A] ANNIGERI

1] Basapur Chilly 05 25 13 65 02 10 20 100 2] Bhadrapur Chilly 06 30 13 65 01 05 20 100 3] Hallikeri Chilly 07 35 12 60 01 05 20 100 4] Navlavadi Chilly 06 30 11 55 03 15 20 100 5] Saidapur Chilly 08 40 10 50 02 10 20 100 TOTAL 32 59 09 100 B] MORAB

1] Yamanur Chilly 07 35 11 55 02 10 20 100 2] Tirlapur Chilly 05 25 14 70 01 05 20 100 3] Shanwad Chilly 08 40 10 50 02 10 20 100 4] Shirakal Chilly 09 45 10 50 01 05 20 100 5] Halkusugal Chilly 07 35 12 60 01 05 20 100 TOTAL 36 57 07 100 Source: Field Survey

83 Cost of Cleaning the Crop area: The labour cost of cleaning the standing crop of chilly per acre was Rs.300 and below is 02 and 01 each in Annigeri and Morab province and Rs.300 to Rs.600 according to 44 and 50 farmers in Annigeri and Morab province. However 54 and 49 farmers in Annigeri and Morab province is asserted that the labour cost of cleaning in the chilly crop per acre was Rs.600 and above. The above details are mentioned in the following table. Table No. : - 4.4 Cost of cleaning the chilly crop per acre Province Crop Rs 300 Pc Rs300 to Pc Rs 600 Pc Total below Rs 600 A] ANNIGERI

1] Basapur Chilly - - 10 50 10 50 20 2] Bhadrapur Chilly - - 08 40 12 60 20 3] Hallikeri Chilly 02 10 10 50 08 40 20 4] Navlavadi Chilly - - 09 45 11 55 20 5] Saidapur Chilly - - 07 35 13 65 20 TOTAL 02 - 44 - 54 - 100 B] MORAB

1] Yamanur Chilly - - 12 60 08 40 20 2] Tirlapur Chilly - - 11 55 09 45 20 3] Shanwad Chilly 01 05 10 50 09 45 20 4] Shirakal Chilly - - 09 45 11 55 20 5] Halkusugal Chilly - - 08 40 12 60 20 TOTAL 01 - 50 - 49 - 100 Source: Field Survey Cost of Crop Cutting: The labour cost of cutting the harvestable crop of chilly was estimated at Rs.400 to Rs.800 per acre by 09 and 12 respondent farmers in Annigeri and Morab province. However 64 and 59 farmers in Annigeri and Morab province asserted

84 that the cost of cutting the chilly crop was Rs.800 to Rs.1500. The cost of crop cutting of chilly per acre at Rs.1500 and above was affirmed by 27 and 29 farmers in Annigeri and Morab province. No farmers have indicated the crop cutting cost of Rs.400 and below. The following table provides the details. Table No. : - 4.5 Cost of Harvesting chilly per acre Province Rs 400 Pc Rs 400 Pc Rs 800 to Pc Rs 1500 Pc Total below to Rs Rs 1500 above 800 A] ANNIGERI 1] Basapur - - 02 22.22 09 14.06 09 33.33 20 2] Bhadrapur - - 01 11.11 14 21.87 05 18.52 20 3] Hallikeri - - 02 22.22 16 25.00 02 07.41 20 4] Navlavadi - - 03 33.33 12 18.75 05 18.52 20 5] Saidapur - - 01 11.11 13 20.32 06 22.22 20 TOTAL - - 09 100 64 100 27 100 100 B] MORAB 1] Yamanur - - 02 16.67 14 23.73 04 13.79 20 2] Tirlapur - - 01 08.33 16 27.12 03 10.34 20 3] Shanwad - - 02 16.67 09 15.25 09 31.04 20 4] Shirakal - - 03 25.00 08 13.56 09 31.04 20 5] Halkusugal - - 04 33.33 12 20.34 04 13.79 20 TOTAL - - 12 100 59 100 29 100 100 Source: Field Survey Cost of Seeds: Cost of seeds per acre of chilly crop was mentioned between Rs.252 to Rs.325 by 58 and 66 respondent farmers in Annigeri and Morab province. However the cost was mentioned at higher level of Rs.325 – Rs.400 by 31 and 46 farmers in Annigeri and Morab province. There are 11 and 08 farmers who have

85 mentioned Rs.400 and above in Annigeri and Morab province. The following table provides the deatails. Table No. : - 4.6 Cost of seeds of Dry chilly per acre Province Rs 250 to Pc Rs 325 to Pc RS 400 Pc Total Pc Rs 325 Rs 400 above A] ANNIGERI

1] Basapur 08 40 10 50 02 10 20 100 2] Bhadrapur 12 60 05 25 03 15 20 100 3] Hallikeri 14 70 03 15 03 15 20 100 4] Navlavadi 11 55 07 35 02 10 20 100 5] Saidapur 13 65 06 30 01 05 20 100 TOTAL 58 - 31 - 11 - 100 - B] MORAB

1] Yamanur 13 65 05 25 02 10 20 100 2] Tirlapur 16 80 03 15 01 05 20 100 3] Shanwad 14 70 04 20 02 10 20 100 4] Shirakal 11 55 07 35 02 10 20 100 5] Halkusugal 12 60 07 35 01 05 20 100 TOTAL 66 - 26 - 08 - 100 - Source: Field Survey Cost of Rentals for Hired Land for Drying the Chilly: Open lands are used by the farmers for drying the harvested chillies on rented bases and rental cost is incoured every season. The rental cost of land was Rs.500 and below as mentioned by 25 and 20 farmers each in Annigeri and Morab province. However a large number of 75 and 80 respondent farmers had mentioned the rental cost of Rs.500 and above per gunta in Annigeri and Morab province.The following table provides the details.

86 Table No. : - 4.7 Cost of rental for Hired Land for Drying the Chilly per Gunta Village Rs 500 Below Pc Rs 500 above Pc Total

A] ANNIGERI

1] Basapur 06 24.00 14 18.67 20 2] Bhadrapur 05 20.00 15 20.00 20 3] Hallikeri 04 16.00 16 21.33 20 4] Navlavadi 05 20.00 15 20.00 20 5] Saidapur 05 20.00 15 20.00 20 TOTAL 25 100 75 100 100 B] MORAB

1] Yamanur 05 25.00 15 18.75 20 2] Tirlapur 05 25.00 15 18.75 20 3] Shanwad 03 15.00 17 21.25 20 4] Shirakal 02 10.00 18 22.50 20 5] Halkusugal 05 25.00 15 18.75 20 TOTAL 20 100 80 100 100 Source: Field Survey Cost of Wages for Regular Workers: The annual cost wages of regular workers by the chilly growing farmers ranged between Rs.3000 – Rs.6000 asserted by 31 and 51 farmers in Annigeri and Morab province of Navalgund taluk. However the higher cost of wages at Rs.6000 and above as mentioned by 69 and 49 farmers in Annigeri and Morab province of Navalgund taluk.The annual wage cost of Rs.3000 and below has not been mentioned by any respondent farmers in the taluk.The following table provides the the details.

87 Table No. : - 4.8 Annual cost of wages of regular workers per acre of chilly crop. Village Rs 3000 Pc Rs 3000 to Rs Pc Rs 6000 Pc Total below 6000 above A] ANNIGERI

1] Basapur - - 06 30 14 70 20 2] Bhadrapur - - 05 25 15 75 20 3] Hallikeri - - 07 35 13 65 20 4] Navlavadi - - 04 20 16 80 20 5] Saidapur - - 09 45 11 55 20 TOTAL - - 31 - 69 - 100 B] MORAB

1] Yamanur - - 09 45 11 55 20 2] Tirlapur - - 10 50 10 50 20 3] Shanwad - - 11 55 09 45 20 4] Shirakal - - 08 40 12 60 20 5] Halkusugal - - 13 65 07 35 20 TOTAL - - 51 - 49 - 100 Source: Field Survey

INVESTMENT IN PRODUCTIVE ASSETS Ownership of Land: The field data have reveled that 66 and 57 each respondent farmers owned 25 acres or less of land in Annigeri and Morab province in Navalgund taluk. The are 22 and 31 each respondent farmers owned 25- 50 acres of land in Annigeri and Morab province. However 12 respondent farmers own 50 acres and above land in each province of Annigeri and Morab of the Navalgund taluk. The following table provides the details.

88 Table No. : - 4.9 Ownership of Land Province 25 acres below 25 acres to 50 50 acres & Total acres above A] ANNIGERI

1] Basapur 12 05 03 20 2] Bhadrapur 16 03 01 20 3] Hallikeri 15 03 02 20 4] Navlavadi 10 05 05 20 5] Saidapur 13 06 01 20 TOTAL 66 22 12 100 B] MORAB

1] Yamanur 11 06 03 20 2] Tirlapur 14 05 01 20 3] Shanwad 13 04 03 20 4] Shirakal 09 11 - 20 5] Halkusugal 10 05 05 20 TOTAL 57 31 12 100 Source: Field Survey Current Value of Land Owned by Farmers: The current value of land owned by the respondent farmers varied between Rs.200000 – Rs.300000 per acre as mentioned by 12 and 21 farmers in Annigeri and Morab province in Navalgund taluk. The current value of land varied from Rs.300000 – Rs.400000 per acre as mentioned by 41 and 39 farmers in Annigeri and Morab province of Navalgund taluk. However the current value of land for Rs.400000 and above per acre as mentioned by a maximum member of 47 and 40 farmers each in Annigeri and Morab province of Navalgund taluk. The following table provides the details.

89 Table No. : - 4.10 Current value of Land per acre Province Rs 300000 to Rs 350000 to Rs 100000 Total Rs 350000 Rs 400000 above A] ANNIGERI

1] Basapur 05 09 06 20 2] Bhadrapur - 10 10 20 3] Hallikeri 04 07 09 20 4] Navlavadi - 08 12 20 5] Saidapur 03 07 10 20 TOTAL 12 41 47 100 B] MORAB

1] Yamanur - 10 10 20 2] Tirlapur 08 07 05 20 3] Shanwad 06 06 08 20 4] Shirakal - 09 11 20 5] Halkusugal 07 07 06 20 TOTAL 21 39 40 100 Source: Field Survey

Value of Agricultural Implements: The value of agricultural implements of farmers was mentioned at Rs.40000 or less by a maximum number of 18 respondent farmers each in Annigeri and Morab province in Navalgund taluk. However maximum number of 49 and 42 farmers each in Annigeri and Morab province in Navalgund taluk has estimated the value of implements at Rs.40000 – Rs.60000 and 33 and 40 farmers estimated the value at Rs.60000 and above. The following table provides the details.

90 Value of Tractor: The current value of tractor owned by the respondent farmers was Rs.1.50 lakh to Rs.2.50 lakhs as attested by 1 farmer each in Byadagi and Navalgund talukas. However the current value was mentioned at R. 2.50 lakh and above by a maximum of 12farmers in Haveri and minimum 2 farmers in Byadagi. The following table provides the details.

Table No. : - 4.11 Value of Agricultural Implements Province Rs 40000 Rs 40000 to Rs 60000 Total below Rs 60000 above A] ANNIGERI

1] Basapur - 10 10 20 2] Bhadrapur 05 08 07 20 3] Hallikeri 06 09 05 20 4] Navlavadi - 15 05 20 5] Saidapur 07 07 06 20 TOTAL 18 49 33 100 B] MORAB

1] Yamanur 03 07 10 20 2] Tirlapur 05 10 05 20 3] Shanwad 04 08 08 20 4] Shirakal 06 07 07 20 5] Halkusugal - 10 10 20 TOTAL 18 42 40 100 Source: Field Survey Loans for other Purposes: The respondents have obtained loan for their other production purposes. The details are provided here.

91 A total number of 107 farmers obtained loans in the range of Rs.50000 and below of which 54 and 53 farmers in Annigeri and Morab province in Navalgund taluk. In the next higher range of loans of Rs.50000 – Rs.100000 was obtained by 46 and 47 farmer of Annigeri and Morab province in Navalgund taluk. The farmers obtained their loan at interest rate varying from a minimum of 6% to a maximum of 14%. The same banking institutions such as PLD Banks, Commercial Banks and Co-op[erative have financed the respondent farmers in ten villages of the Annigeri and Morab province of Navalgund taluk.The following table provides the details. Table No. : - 4.12 Loans obtained for production purpose by Farmers Province Rs 50000 Pc Rs 50000 to Pc Source R o I Total below Rs 100000 A] ANNIGERI

1] Basapur 18 33.33 02 04.34 PLD Bank 14% 20 2] Bhadrapur 15 25.75 05 10.86 Co-op Bank 6 % 20 3] Hallikeri 10 18.52 10 21.73 Commercial 8 % 20 Bank 4] Navlavadi 05 09.25 15 32.60 “ “ 20 5] Saidapur 06 11.12 14 30.43 “ “ 20 TOTAL 54 100 46 100 100 B] MORAB

1] Yamanur 15 22.30 05 10.63 “ “ 20 2] Tirlapur 10 18.86 10 21.27 “ “ 20 3] Shanwad 09 16.98 11 23.42 “ “ 20 4] Shirakal 10 18.86 10 21.27 “ “ 20 5] Halkusugal 09 16.98 11 23.41 “ “ 20 TOTAL 53 100 47 100 100 Source: Field Survey

92 Working Capital and the Sources: The respondent farmers have raised their working capital funds from three main sources viz. own funds, banks and others. The details are given here. Own funds of the chilly growing farmers have constituted a major source of working capital. A total of 116 respondent farmers have used their own funds to a tune of 40% or less of the total of which 74 and 42 were from Annigeri and Morab province in Navalgund taluk. Further 84 farmers used their own funds as working capital to a tune of 60% of the total of which 26 and 58 were from Annigeri and Morab province in Navalgund taluk. The data collected from the field survey reveal that, 89 farmers obtained working capital from banks to a tune of 40% or less of which 40 and 49 farmers are from Annigeri and Morab province in Navalgund taluk. However, 60 and 51 farmers obtained a working capital from banks to a tune of 60% of their total requirement. The following table provides the details. Table No. : - 4.13 Working capital- Source & Extent of Amt.used Province Own Funds Total Banks Total 40% 60% 80% 40% 60% 80% Below Above Below Above A] ANNIGERI

1] Basapur 15 05 - 20 10 10 - 20 2] Bhadrapur 20 - - 20 15 05 - 20 3] Hallikeri 15 05 - 20 - 20 - 20 4] Navlavadi 14 06 - 20 05 15 - 20 5] Saidapur 10 10 - 20 10 10 - 20 TOTAL 74 26 - 100 40 60 - 100

93 B] MORAB

1] Yamanur 10 10 - 20 15 05 - 20 2] Tirlapur 05 15 - 20 10 10 - 20 3] Shanwad 08 12 - 20 05 15 - 20 4] Shirakal 10 10 - 20 10 10 - 20 5] Halkusugal 09 11 - 20 09 11 - 20 TOTAL 42 58 - 100 49 51 - 100 Source: Field Survey

Chilly Crop Farmers – Factors Influencing the Preference of Farmers: The chilly growing farmers covered by the study have shown preference for the chilly crop due to some major reasons. The respondents have ranked 5 factors as first important factors that have influenced them in going for the chilly crop and produce in preference to the other crops. Among the five “ Low unit cost of production” is given as a first rank by maximum of 26 respondent farmers followed by 24 farmers who ranked it as a first on the grounds of “Low requirement of water”, 22 farmers for “Less amenable to pests and diseases”, 21 farmers for “ good price” and 7 farmers prefering the chilly crop on the grounds of “More demand in the market”. Second, third and other ranks are gien by many respondent farmers in the study area.The following table provides the details.

94 Table No. : - 4.14 Chilly Farmers – Factors influencing the Preference of Farmers Ranks indicating Preference for Chilly crop by Farmers S.n Factors I II III IV V VI VII VIII IX X XI o 1 Good unit price 21 15 16 30 13 02 02 01 - - - 2 Low unit cost of production 26 19 37 13 02 02 01 - - - - 3 Low water Requirement 24 41 23 07 04 01 - - - - - 4 Less amenable to Pests and diseases 22 18 14 36 10 ------5 More demand in the market 07 03 04 13 61 02 - 01 - - - 6 Soil is more suitable for the oil seed and - 01 01 03 04 69 06 - - - - cash crops 7 Low requirement of manure - 02 - 01 - 06 85 06 - - - 8 Low Labour Requirement - - 01 - - - 07 91 01 - - 9 Crop duration is less 04 19 6 01 9 10 Produce is not Perishable 18 09 - - 11 Others 01 0 - 4 Source: Field Survey Innovative Method of Chilly Production: The chilly production like other agricultural products has been experimented with better techniques of enhancing productivity. The farmers have been using better seeds and techniques of farming with proper use of manuring and watering. Hence, the respondent farmers were approached by the researcher regarding the use of innovative methods of cultivation of chilly crop. The maximum number of respondent farmers of 96 and 89 each in Annigeri and Morab province of Navalgund taluk affirmed that they have been using innovative methods of production of chilly. However a small number of 04 and 11 farmers each in Annigeri and Morab province of Navalgund taluk did not use such modern techniques of production. The following table provides the details.

95 Table No. : - 4.15 Use of innovative methods of cultivation of Chilly crop Province No. of Farmers Total A] ANNIGERI Yes No 1] Basapur 19 01 20 2] Bhadrapur 20 - 20 3] Hallikeri 18 02 20 4] Navlavadi 20 - 20 5] Saidapur 19 01 20

TOTAL 96 04 100 B] MORAB 1] Yamanur 19 01 20 2] Tirlapur 17 03 20 3] Shanwad 18 02 20 4] Shirakal 18 02 20 5] Halkusugal 17 03 20

TOTAL 89 11 100 Source: Field Survey

Availability of Adequate Quality Seeds: It is encouraging to find that the entire 200 respondent in the 10 villages of Annigeri and Morab province of Navalgund taluka confirmed that they could get adequate and quality chilly crop seed for their production activities. Obtaining of Expert’s Advice on Chilly crop Farming: It is learnt from the respondent farmers in the study area that all of them did obtain expert opinion about the farming of seed and chilly production. It shows their awareness about the expertise available from Government and other agencies in this direction.

96 Growing of Chilly crop on the Basis of Market Trends and Price Movements: The personal interviews with the respondents of cash crop growing farmers indicated that they did take the decision of growing cash crop after observing the market trends about the demand and price for the product. However, in case of dry chilli all 200 farmers of 10 villages of Annigeri and Morab province have mentioned that they did not follow the policy of growing the chilly crop on the basis of market demand and the price level of produce.The following table provides the details. Table No. : - 4.16 Market Trends and price changes influenced the chilly produce Province No. of Farmers Total A] ANNIGERI Yes No 1] Basapur - 20 20 2] Bhadrapur - 20 20 3] Hallikeri - 20 20 4] Navlavadi - 20 20 5] Saidapur - 20 20 TOTAL - 100 100 B] MORAB 1] Yamanur - 20 20 2] Tirlapur - 20 20 3] Shanwad - 20 20 4] Shirakal - 20 20 5] Halkusugal - 20 20 TOTAL - 100 100 Source: Field Survey

97 Frequency of Growing Chilly crop: All the selected farmers in the 10 of Annigeri and Morab province of Navalgund taluka have affirmed that they have raised a single chilly crop in a year. Employment: The data collected from the respondent farmers in 10 villages of Annigeri and Morab province in Navalgund taluk have revealed that a total number of 598 male members of the families of the 200 farmers have been engaged in production activities of the chilly farmers. Province wise figures indicate that 277 male and 321 male members of the farmers worked on the farms in 10 villages of Annigeri and Morab province in Navalgund taluk. There are 261 and 307 female workers are engaged in growing the chilly crop in 10 villages of the Annigeri and Morab province in Navalgund taluk. In addition to male and female members a total of 438 children were also engaged in chilly farming operations in 10 villages of Annigeri and Morab province of Navalgund taluk covered by the study.The following table provides details. Table No. : - 4.17 Family Members employed in chilly farming Province Male members Female members Children Total A] ANNIGERI

1] Basapur 30 33 45 108 2] Bhadrapur 63 64 38 165 3] Hallikeri 69 63 48 180 4] Navlavadi 52 44 34 130 5] Saidapur 63 57 49 169 TOTAL 277 261 214 752

98 B] MORAB

1] Yamanur 47 45 32 124 2] Tirlapur 65 61 38 164 3] Shanwad 66 65 46 177 4] Shirakal 71 67 51 189 5] Halkusugal 72 69 57 198 TOTAL 321 307 224 852 Source: Field Survey Employment of Hired Workers: The 200 respondent chilly growing farmers had employed 886 casual labourers of which farmers in Navalgund taluk employed 434 and 452 each in Annigeri and Morab province. The total number of regular hired workers was 499 of which 242 and 257 were employed in Annigeri and Navalgund province. The total number of hired workers employed during the season was 1736 of which 928 were employed in Annigeri province and 808 in Morab province. The following table provides the details. Table No. : - 4.18 Employment of Hired workers Province Casual Labours No`s Regular Labours No’s During Labours[Season] No’s A] ANNIGERI 1] Basapur 71 38 140 2] Bhadrapur 86 46 171 3] Hallikeri 91 52 206 4] Navlavadi 102 60 210 5] Saidapur 84 46 201 TOTAL 434 242 928 B] MORAB 1] Yamanur 86 47 151 2] Tirlapur 78 55 145 3] Shanwad 96 60 160 4] Shirakal 95 47 177 5] Halkusugal 97 48 175 TOTAL 452 257 808 Source: Field Survey

99 Wage Rates for Hired Workers per day: The wages varied between a minimum of Rs.70 per day to a maximum of Rs.90 per day as mentioned by 148 respondent farmers in the ten villages of Annigeri and Morab province of Navalgund taluka. However 52 farmers mentioned that the wage rate per day for the hired workers was Rs.90 to Rs.100 per day in Annigeri and Morab province of the Navalgund taluka. The following table provides the details. Table No. : - 4.19 Wage rates for Hired Workers per day Province Rs 70 to Rs 90 Rs 90 to Rs 100 Total Farmers A] ANNIGERI 1] Basapur 15 05 20 2] Bhadrapur 14 06 20 3] Hallikeri 16 04 20 4] Navlavadi 13 07 20 5] Saidapur 17 03 20 TOTAL 75 25 100 B] MORAB

1] Yamanur 16 04 20 2] Tirlapur 17 03 20 3] Shanwad 13 07 20 4] Shirakal 15 05 20 5] Halkusugal 12 08 20 TOTAL 73 27 100 Source: Field Survey

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100 CHAPTER – V MARKETING DIMENSIONS OFCHILLY CROP IN NAVALGUND TALUK

Marketing of farm products tends to be a complex process of marketing of agricultural produce involves an elaborate and complex marketing organization in view of the growth of distance between the farm producer and the consumer as well as the small size and wide scatter of the producing units. The problems in marketing of agricultural produce spring from their conditions of production and nature of demand. The flow of farm produce from the farm to the market requires some preparation and processing. The market system has to provide the transport and storage facilities as well as finance and risk bearing. Farm sector is characterized by great variations both in the output and quality of the produce from year to year and between seasons. The farm products exhibit more weight and volume in comparison to manufactured goods. These products are generally perishable and cannot be stored for a considerable period of time. There is always a time lag before an adjustment of supply to demand. Prices of agricultural produce are most unstable. Some of the inadequacies associated with the marketing of farm produce have been overcome in the post independence period. Important development in this direction relate to the enactment of regulated markets, linking of credit to marketing through cooperative marketing, grading standardization of weights and measures, provision of weights and measures, provision of ware housing facilities, regulation of forward contract, fixing of floor prices, market intelligence and market news service and State Trading in food grains. These and other measures and improvements have placed the farmer in a stronger bargaining position and have ensured him a greater share in the consumers‟ rupee.

101 Marketable surplus of chilly crop is sold off by producers at the nearest assembling market or sell to the local dealers at their own farmhouse. Dealers may be village merchant‟s itinerant dealers and agents of wholesale merchants and in some cases the agents of crushing concerns. The milling units play an important role in the areas where there are no regulated markets. They collect Chilly from the villages either through their own agents or through village merchants to whom they give financial help to run their business. Village merchants carry on money lending business by way of advancing small amounts to the cultivators either in the form of cash or kind with the understanding that the cultivator would dispose of the produce to them or through them only. Producers of chilly crop decide to sell their produce at the village or take it to an assembly market on the basis of some considerations. These considerations or factors relate to the quantity of produce, the distance from the market, transport facilities, market charges and prices at the village level and the immediate need for cash etc. The markets relating to chilly crop are classified into 3 groups viz; primary markets secondary markets and terminal markets. Primary markets are periodical markets also known as weekly bazaars. Mandis or grunj are secondary markets that provide permanent place for daily transactions to take place with some amenities for the benefits of the sellers and buyers. The terminal markets are urban centres. They take stocks from producing centres as well as from important markets. The main thrust of the present chapter relates to an extensive and in-depth study of the different dimensions of marketing of chilly crop in the study area comprising of 10 villages in Annigeri and Morab province in Navalgund taluk. The study covers all the important areas of chilly marketing with the help of the empirical data collected from the selected 200 respondents in the 10villages in Annigeri and Morab province in Navalgund taluka.

102 The important aspects covered for the analysis include the assembling of the produce by the farmers after the harvesting is over and the cost and duration of assembling etc. Next the storage and cost of storage and also the duration and location of storage has been discussed with the necessary statistical data obtained from the respondent farmers. The practices followed by the chilly farmers about the packing and its costs have been analysed. The important area of grading of the chilly produce and the cost involved etc has been analysed in detail. Channel of distribution and the role of APMC etc. have been analysed with the help of the data gathered from the responses of the selected farmers. The role of transport and the transport facilities of the chilly farmers incurred by them have been examined in detail. Market information, the sources and the cost of market information of the farmers have been analysed. The data analysis relating to marketing finance sources of finance etc has been made in this chapter. Another important aspect of marketing of chilly analysed in this chapter relates to marketing cost. Price behaviour of chilly over a period of five years in the respective areas covered by the study has been analysed in detail in the chapter. The general problems of marketing of chilly by the respondent farmers have been examined by taking into account the perceptions of the farmers covered by the study. The various aspects of marketing of chilly in the study area have been analysed strictly on the basis of the views and responses of the selected 200 farmers engaged in the production and marketing of chilly in their respective areas. Assembling: The first important step in the marketing of the chilly produce relate to proper assembling it in suitable premises. The farmers have been following the practice of assembling the chilly in specially designated storerooms or in their residential places. The responses have been identical from all the 20

103 respondents each in all the ten villages in Annigeri and Morab province in Navalgund taluk of the Dharwad district covered by the study. The following table provides the details.

Table No. : - 5.1 Assembling of Chilly Province No. of Farmer`s store No. of farmer`s Residential room premises A] ANNIGERI

1] Basapur - 20 2] Bhadrapur - 20 3] Hallikeri - 20 4] Navlavadi - 20 5] Saidapur - 20 TOTAL 00 100 B] MORAB

1] Yamanur - 20 2] Tirlapur - 20 3] Shanwad - 20 4] Shirakal - 20 5] Halkusugal - 20 TOTAL 00 100 Source: Field Survey

The details in the above table indicate uniformity in the practice of assembling the chilly after the harvesting is over. This is first preparatory stage before marketing the produce. Cost of Assembling: The responses of the 200 selected farmers in the ten villages as have indicated that the cost of assembling chilli is Rs 10 to 15 per bag.

104 Duration of Keeping Assembled Chilly: The 20 respondents each in the 10 villages in Annigeri and Morab province of Navalgund taluka have indicated that the minimum and maximum period of keeping their assembled chilli is one month and 6 months respectively. Storage: The next step in the process of marketing the chilly is moving the assembled produce to marketing centres from the local villages and stores them in suitable places in coordination with middle men. The storage options for the chilly farmers are the Government warehouses, private warehouses and APMC warehouses. The farmers have indicated more than one option since they could not avail of only one of the options of storage due to inadequacy of space. The following table provides the details.

Table No. : - 5.2 Storage of Chilly Province Govt.warehouse Private APMC Total warehouse warehouse A] ANNIGERI 1] Basapur - - 20 20 2] Bhadrapur 01 - 19 20 3] Hallikeri - - 20 20 4] Navlavadi 02 - 18 20 5] Saidapur - - 20 20 TOTAL 03 - 97 100 B] MORAB 1] Yamanur 02 - 18 20 2] Tirlapur - - 20 20 3] Shanwad - - 20 20 4] Shirakal - - 20 20 5] Halkusugal - - 20 20 TOTAL 02 - 98 100 Source: Field Survey

105 It is clear from the above table that all the respondent farmers used storage facilities of APMC. The 3 respondents each in Annigeri province used government warehouse facilities while 2 respondents each in Morab province used private warehouse. Cost of Storage: All 200 respondent farmers have affirmed the uniform storage which is shown as below: Chillies : Rs. 25 per bag per month Adequacy of Storage Facility: The respondents are divided in their opinion about the adequacy of storage facilities for their chilly. The following table provides the details. Table No. : - 5.3 Adequacy of storage facility Province Store room Residential premises No. Total No. of farmers of farmers A] ANNIGERI

1] Basapur 20 - 20 2] Bhadrapur - 20 20 3] Hallikeri 20 - 20 4] Navlavadi - 20 20 5] Saidapur 20 - 20 TOTAL 60 40 100 B] MORAB

1] Yamanur 15 05 20 2] Tirlapur 05 15 20 3] Shanwad 20 - 20 4] Shirakal 20 - 20 5] Halkusugal 20 - 20 TOTAL 80 20 100 Source: Field Survey

106 The details of responses in the above table indicate that all the 20 respondent farmers each in Annigeri province Morab province have affirmed that the storage facilitites.However the 20 respondents each in Bhadrapur and Nalavadi of Annigeri province and 5 respondents of yamanur and 15 respondents of Trilapur of Morab province of Navalgund taluk have mentioned that an inadequate storage facilities in respect of chillies. The Average Period of Storage: All the 200 respondent formers of chilly crop of all 10 villages of Annigeri and Morab province of Navalgund taluk have affirmed the average period of keeping their produce in storage was 3 to 6 months. Packing and packing cost of Dry Chilly: The usual practice of packing the dry chillies is by using the gunny bags. All the 200 respondent farmers have affirmed the use of gunny bags for packing the produce before the same is sold in market. The packing cost chillies is mentioned by all 200 respondent farmers of 10 villages of Annigeri and Morab province of Navalgund taluk is shown as below: Table No. : - 5.4 Packing and packaging cost of Dry chilly Mode of packing Gunny Bags Cost of package Material Rs.22 to Rs.25 Cost of packing Rs.10 to Rs.12 Source: Field Survey

Packing requirement for bulk agricultural commodities is less costly since they do not need packing material of superior quality. Dry chilly is not a perishable commodity. Hence the duration of keeping the produce in storage can be extended if price consideration requires it.

107 Location of Sales: The respondent farmers have exercised two options of locations for the sale of chilly. Sales have been taking place locally as well as at APMC yards. The local sales of dry chilly takes place due to prior commitment of the farmers with the local merchants based on prior advances received by the farmers. Some farmers sell locally due to transport or personal financial difficulties. Farmers who are able to wait for a better price and whose stock of chilly is of large volume take their produce to APMC yards. The responses of the 20 farmers each selected in 2 provinces of Navalgund taluk have resorted to sell part of their dry chillies locally and the rest at the APMC yards. Reasons for Local sales of Dry chilly: The respondent farmers in Annigeri and Morab province of Navalgund taluk in Dharwad district have advanced more than one reason for the local sales of their Dry chilly produce. The following table provides the details. Table No. : - 5.5 Reasons for local sales of Dry chilly Reasons Basapur Bhadrapur Hallikeri Nalavadi Saidapur Total Need for immediate sale 20 20 20 20 20 100 To repay old debts to money 20 20 20 20 20 100 lenders & merchants etc To avoid transport cost to 20 20 20 20 20 100 carry the produce to APMC Quantity of produce is small 20 20 20 20 20 100 Storage Difficulties 20 20 20 20 20 100 Reasons Yamanur Tirlapur Shanwad Shirkal Halkusugal Total Need for immediate sale 20 20 20 20 20 100 To repay old debts to money 20 20 20 20 20 100 lenders & merchants etc To avoid transport cost to 20 20 20 20 20 100 carry the produce to APMC Quantity of produce is small 20 20 20 20 20 100 Storage Difficulties 20 20 20 20 20 100 Source: Field Survey

108 It is evident from the details in the above table that all 20 respondents in 10 villages of Annigeri and Morab province of Navalgund taluk in Dharwad district have indicated that the need for immediate cash compelled them to sell locally their Dry chilly produce. Similarly repayment of old debt to merchants and moneylenders also compelled all the 20 respondents each in 10 villages of Annigeri and Morab province in Navalgund taluka to sell their produce locally. The third reason that compelled them to sell locally was to avoid the transport cost in carrying the produce to APMC. However all the 200 respondents in each village of Annigeri and Morab province of Navalgund taluk have also mentioned that the local sales of Dry chilly by them were due to the small quantity and storage difficulties of the produce. Preference for sales at APMC: The responses obtained from the 200 farmers in the 10 villages of Annigeri and Morab province in Navalgund taluk indicate that they preferred sales at APMC yard for some specific reasons. The following table provides the details. Table No. : - 5.6 Preference for sales of Dry chilly at APMC

Reasons Basapur Bhadrapur Hallikeri Nalavadi Saidapur Total APMC ensures better price 20 20 20 20 20 100 APMC provides storage 20 20 20 20 20 100 facilities APMC provides grading 20 20 20 20 20 100 facilities APMC provides proper 20 20 20 20 20 100 weighing facilities APMC provides better market 20 20 20 20 20 100 information APMC provides best arbitrary 20 20 20 20 20 100 decisions in case of quarrels between farmers & buyers in respect of quality of produce

109

Reasons Yamanur Tirlapur Shanwad Shirkal Halkusugal Total APMC ensures better price 20 20 20 20 20 100 APMC provides storage 20 20 20 20 20 100 facilities APMC provides grading 20 20 20 20 20 100 facilities APMC provides proper 20 20 20 20 20 100 weighing facilities APMC provides better market 20 20 20 20 20 100 information APMC provides best arbitrary decisions in case of quarrels between farmers & buyers in respect of quality of produce Source: Field Survey

The details of responses of all the selected respondent farmers mentioned in the above table indicate a consensus about the reasons for preference to sell Dry chilly at APMC Yard. The only reason which has not been confirmed relates to the APMC providing best arbitrary decisions. All the four facilities relating to better price to the produce storage facilities grading facilities and weighing have been considered useful and are responsible for preferring sales at APMC Yards. Channel of Distribution: Channel of distribution refers to the course taken in the transfer of the title to commodity. It is the route taken by the title to a product in its passage from its first owner, the agricultural producer or a manufacturer as the case may be to the last owner, the ultimate consumer or the business user. The major participants in the distribution channel are; producers, intermediaries and consumers. The intermediaries are the wholesalers, retailers and facilitators who direct the products and service to the consumers. The responses of the 200 farmers engaged in production and marketing of dry chilly sell their produce through commission agents and cooperative

110 marketing societies. The responses indicate complete unanimity among all the farmers selected for the study. There is a different opinion about the satisfaction among the respondents regarding the channel of distribution. The following table provides the details. Table No. : - 5.7 Opinion about the channel of distribution Province Yes No Total A] ANNIGERI 60 40 100 B] MORAB 54 46 100 Total 114 86 200 Source: Field Survey

It is evident from the details in the above table that majority of 60 and 54 respondents are satisfied with the channel of distribution in their sales of dry chilly. A substantial number of 40 and 46 respondents are not satisfied with the channel of the distribution. All the 114 selected farmers each in Annigeri and Morab province are satisfied with the channel while all the 86 respondent farmers each in Annigeri and Morab province of Navalgund taluk are not satisfied with the channel. Selling the Dry Chilly in More than One Market: The responses of the 200 dry chilly farmers indicate that they are all selling their produce in more than one market. The markets where they sell their dry chilly include local market and APMC. All the 100 farmers in Annigeri province sell their dry chilly in local market to a tune of 50% to 60%. The same position of the 100 farmers each in Morab province is indicated through their responses.

111 Grading of the Product: Grading is the division of products into classes made up of units possessing similar characteristics of size and quality. It is sorting of individual specimens of a product to predetermined standard grades or classes to which they belong. Generally agricultural or horticultural product or natural products like iron ore etc which do not have uniformity in quality are to be graded. Here the principle of standardization is applied in terms of grade. Grading has a functional role to play. It provides ethical basis for marketing of goods. Graded goods attract better market and better price. The responses of the 200 respondent farmers indicate that the Grading is generally done by the growing farmers themselves with the help of expert labuor. All the 200 respondents in each 10 villages of Annigeri and Morab province have asserted that the vgarding of their dry chilly produce is beneficial for them. The annual cost of grading of chilli Rs. 400 and above Rs 400 per quintal. The following table provides the details. Table No. : - 5.8 Cost of grading Dry chilly [No. of Farmers] Province Cost per quntal Rs.400 Rs.400 above total A] ANNIGERI 85 15 100 B] MORAB 95 05 100 Total 180 20 200 Source: Field Survey

It is evident from the details in the above table that all the 180 respondent farmers mentioned the cost of grading of at Rs.400 per quintal. Similar was the response of all the 85 and 95 respondents of Annigeri and Morab province. Further all the 20 respondents each Annigeri and Morab province mentioned the

112 cost of grading is Rs. 400 and above. Similar was the responses of all the 15 and 5 respondents of Annigeri and Morab province. Insurance of Dry Chilly: The respondent farmers (200) have asserted that they did not insure their produce before it was sold. Hence they did not incur any cost in insurance. The respondents suggested that the cost of insurance was high and hence they did not go in for insuring the Dry chilly. Transport for Dry Chilly Marketing: The respondent farmers have been using trucks, and carts for transporting their dry chilly produce. The farmers are using both own vehicles and hired ones. It is found that a large majority of 175 farmers have used hired vehicles while only 25 farmers have used their own vehicles for transporting of their dry chilly produce in Annigeri and Morab province. The following table provides the details. Table No. : - 5.9 Own and hired vehicles for transport of chilly Province Own vehicles Hired vehicles Total A] ANNIGERI 05 95 100 B] MORAB 20 80 100 Total 25 175 200 Source: Field Survey

It is clear from the details in the above table that all the 95 and 80 respondent farmers in Annigeri and Morab province depended on hired vehicals for their transport requirements. However small number 5 and 20 farmers in Annigeri and Morab preovince had their own vehicles for their transport requirements.

113 Annual cost of Transport: Generally the major factors affecting the cost of transportation relates to the following 1 Distance 2 Quality of product 3 mode of Transport 4. Road Condition. 5. Nature of product 6. Risk associated with transportation work The transportation cost is generally borne by the growing farmers. The annual cost of transport of dry chilly is provided in the following table. Table No. : - 5.10 Annual cost of transport of Dry chilly Crop Cost of transport Dry chilly Rs.25 per bag Note: 1] The above rate is for 1 km to 40 kms per bag. 2] Over and above 40 kms, 25% more than the normal rates are charged. Source: Field Survey Market Information: Marketing information refers to any information about the market and the products traded in the market. The information pertains to demand and supply conditions of the product, price conditions, transport and warehousing conditions, channel of distribution, competition and facilities of infrastructure like banking insurance, grading etc. Marketing information helps in making key marketing decisions. It is useful in planning the product, introducing new produce and Selection of distribution channel. It is useful in increasing sales, diversifying sales and capturing new markets.

114 The sources of market information are reports of traveling salesmen, market intermediaries like wholesalers and retailers, records of business etc. Sources of Market Information for Dry Chilly Farmers: Information obtained through personal interview with the farmers revealed that the main sources of market information were commission agents, APMC, Newspapers and Radio and TV. The following table provides the details. Table No. : - 5.11 Sources of market information [no. of farmers] Reasons Basapur Bhadrapur Hallikeri Nalavadi Saidapur Total Whole sale merchants ------Commission Agents 20 20 20 20 20 100 APMC 20 20 20 20 20 100 News papers 20 20 20 20 20 100 Radio-TV 20 20 20 20 20 100 Friends & Relatives ------Reasons Yamanur Tirlapur Shanwad Shirkal Halkusugal Total Whole sale merchants ------Commission Agents 20 20 20 20 20 100 APMC 20 20 20 20 20 100 News papers 20 20 20 20 20 100 Radio-TV ------Friends & Relatives Source: Field Survey

The details in the above table indicate uniform responses from all the 20 respondent farmers each in the 10 villages of Annigeri and Morab province of Navalgund taluk in Dharwad district.

115 A significant revelation from the discussion with the respondent farmers is that none of them incurred any expenditure in obtaining the market information from the above-mentioned sources. However a very interesting fact that has emerged from the discussion with the respondents was that they did not get any benefit from the market information what they obtained from those sources. Marketing Finance: The farmers required finance for different marketing operations like storage; grading transport packing etc. the responses of the 200 respondents in the study area indicate that they did require finances for the marketing of their dry chilly. There has been complete unanimity among all the 200 respondents on this aspect. They have mentioned the four areas of marketing for which they needed finance viz. storage, grading, transport and packing. The respondent farmers have indicated that they have relied on their own funds and bank loans for their marketing expenditures. There is again a complete unanimity of opinion among all the 200 respondent farmers. The requirements of finance and the percentage of funds used for the marketing operations are indicated in the following table. Table No. : - 5.12 Marketing Finance – use of the Sources Province Own Funds[%] Bank loans[%] 20-40 40-80 80 Above 20-40 40-80 80 Above A] ANNIGERI 45 05 - - 50 - B] MORAB 45 10 - - 45 - Total 90 15 - - 95 - Source: Field Survey The details in the above table reveal that maximum of 90 respondents used 20-40% of their own funds for meeting the financial needs in their

116 marketing of dry chilly while 15 of them relied on a higher amount of 40-80% of their own funds for the marketing purposes. However maximum of 95 respondents used 40-50% of the bank loans to meet their financial needs for marketing their produce. Marketing Cost: Information collected from the respondent farmers growing dry chilly indicate that the major areas of marketing cost relate to packing, storage, transport, grading and weighing. The details are given in the following table. Table No. : - 5.13 Marketing cost of Dry chilly per bag Province Packing Storage Transport Grading A] ANNIGERI Rs.10 to Rs.10 Rs.10 Rs.25 Rs.25 Rs.50 Rs.11 above above 1] Basapur 20 - 20 - 20 20 2] Bhadrapur 20 20 - 20 - 20 3] Hallikeri 20 - 20 - 20 20 4] Navlavadi 20 - 20 20 - 20 5] Saidapur 20 20 - 20 - 20 TOTAL 100 40 60 60 40 100 B] MORAB 1] Yamanur 20 - 20 - 20 20 2] Tirlapur 20 20 - 20 - 20 3] Shanwad 20 - 20 - 20 20 4] Shirakal 20 - 20 20 - 20 5] Halkusugal 20 20 - 20 - 20

TOTAL 100 40 60 60 40 100 Source: Field Survey

117 Packing cost have been indicated at Rs. 10 to Rs. 11 per bag by all the 20 rspondents each in the 10 villages of Annigeri and Morab province of Navalgund taluk of Dharwad district. There is complete unanimity on this among all the 200 respondents. Maximum number of 80 respondents has incurred Rs. 20 or below per bag of dry chilly. This has been asserted by 20 farmers each in Bhadrapur, Saidapur, Tirlapur and Halkusgal in Navalgund taluk. Maximum numbers of 60 farmers have indicated that transport cost was Rs. 25 of which 20 farmers each belonged to Bhadrapur, Nalavadi, Saidapur, Tirlapur, Shirkol and Halkusgal. However respondent farmers have asserted that the transport cost was Rs. 25 and above of which 20 farmers each belonged to Basapur, Hallikeri, Yamnur and Shanwad. All the 20 farmers in each of the 2 provinces have asserted that the grading cost was Rs. 50 per bag. Pricing of Dry Chilly: Price is the value of product attributes expressed in monetary terms which a buyer pays or is expected to pay in exchange and anticipation of the expected or offered utility. Price helps in establishing a mutually advantageous economic relationship and facilitates the transfer of ownership of goods and services from the company to buyers. Pricing is a marketing function and it is the most important variable next only to product which affects the success or failure of business. In the Indian context pricing policies are incorporated in the overall government policies spectrum. The major objectives which guide the government in this direction are, i. Protection of consumer interests from price rise. ii. Ensuring fair return on investment by industries iii. Protection of producers of agricultural products against vicissitudes of prices iv. Protection of trade restrictive and anti competitive pricing.

118 The above objectives are achieved by a system of price regulation. Pricing of Dry Chilly in the study area: The dry chilly producing farmers are faced with market conditions more closely to monopolistic competition. Numerous sellers of the dry chilly are faced with a comparatively smaller number of buyers who may be wholesalers, retailers or mill units. The prevalent market conditions determine the dry chilly prices. The role of a few merchants influences the price of dry chilly. The market supply and demand no doubt influence the price of dry chilly. However some imperfections in the dry chilly market influence the prices greatly. As mentioned earlier the local merchants and money lenders who advance cash to small farmers and exploit them through quoting unremunerative prices. The dry chilly seller like other farmers is forced to become a price taker rather than a price maker. The influence of APMCs is still not fully felt in villages because of the local sales taking place due to financial limitations of dry chilly growers. Responses of the 200 dry chilly growers covered by the study clearly indicate that they are not satisfied with the present system of price fixing for their produce as shown below. Table No. : - 5.14 Reasons for Dis-satisfaction of present pricing system Reasons Basapur Bhadrapur Hallikeri Nalavadi Saidapur Total Price is not commensurate 20 20 20 20 20 100 with the cost of production. Price is arbitrary 20 20 20 20 20 100 Price indicates the 20 20 20 20 20 100 exploitation of Middle men Price not influenced by Govt. ------price support policy

119

Reasons Yamanur Tirlapur Shanwad Shirkal Halkusugal Total Price is not commensurate 20 20 20 20 20 100 with the cost of production. Price is arbitrary 20 20 20 20 20 100 Price indicates the 20 20 20 20 20 100 exploitation of Middle men Price not influenced by Govt. ------price support policy Source: Field Survey

All the 20 respondent farmers in each 10 villages in Annigeri and Morab province in Navalgund taluk of Dharwad district have affirmed that the price they obtained from the buyers of dry chilly is arbitrary but the price is not commensurate with the cost of production. Similarly all the 20 respondent farmers in each of the 10 in Annigeri and Morab province in Navalgund taluka of Dharwad district have asserted that the price indicates the exploitation by the middlemen. The respondent farmers have indicated some suggestions for ensuring a reasonable price for their dry chilly sales. The following table provides the details. Table No. : - 5.15 Suggestions for better price for Dry chilly [No. of farmers] Reasons Basapur Bhadrapur Hallikeri Nalavadi Saidapur Total Organizing the Co-operative 20 20 20 20 20 100 marketing societies for sale of produce More active role for APMC 20 20 20 20 20 100 in getting better price Selling directly to oil mills - - - 20 - 20 and avoid middle men

120 Reasons Yamanur Tirlapur Shanwad Shirkal Halkusugal Total Organizing the Co-operative 20 20 20 20 20 100 marketing societies for sale of produce More active role for APMC 20 20 20 20 20 100 in getting better price Selling directly to oil mills - 20 - - - 20 and avoid middle men Source: Field Survey The details in the above table indicate that all the 20 respondent dry chilly farmers have favoured organisation of cooperative marketing societies for sales of dry chilly. Similarly all of them have urged that the APMC should play more active role in getting better price for dry chilly. The 20 respondent farmers in Nalavadi and Bhadrapur have suggested for a direct sales of dry chillies to oil mills, so that the share of middlemen could be avoided and they can get a better price. Price Trends of Dry Chilly during 2005-06 to 2009-10: The dry chilly prices in the study area have prevailed at a steady range of Rs.4000 to Rs.7000 and above per quintal. This has been affirmed by all the 200 respondent farmers in the Navalgund and Konnur provinces in Navalgund taluk of Dharwad district.The following table provides the details. Table No. : - 5.16 Price of Dry chilly 2005-06 to 2009-10 [No. farmers] Province 2005-06 2006-07 2007-08 2008-09 2009-10 A] ANNIGERI Rs.4000-Rs.7000 35 55 70 75 50 Rs.7000-Rs.10000 65 45 30 20 35 Rs.10000 & above - - - 05 15 B] MORAB Rs.4000-Rs.7000 40 65 75 80 45 Rs.7000-Rs.10000 60 35 25 17 54 Rs.10000 & above - - - 03 01 Total 200 200 200 200 200 Source: Field Survey

121 The details in the above table indicate identical responses of the 200 respondent farmers in the 10 villages in Annigeri and Morab provinces in Navalgund taluk of Dharwad district. However 20 respondent farmers in 10 villages of Annigeri province and 4 farmers in 10 villages of Morab province have indicated a price of Rs.10,000 and above per quintal

Major Marketing Problems of Dry Chilly: Major marketing problems of dry chilly in the study area have been ascertained and identified through personal discussions with the 200 respondent farmers covered by the study. The responses have been summarized here. 1. Inadequate storage and High cost of Storage. This problem of dry chilly marketing has been ranked as problem No. 1 by 65 respondent farmers. A maximum of 70 farmers have ranked this problem at No.III while 14 farmers have ranked it as problem no. II. Few other respondent have ranked as problem no. IV (17), problem No. VII (6), problem No.VIII ((26), No. IX (02). 2. High cost of Packing Material This problem is considered as problem No. I by 28 respondent farmers and as problem No. II by 79 farmers, problem No. III (29), problem No.V (06), Proplem No. VI (30) Problem No.VII (05) Problem No.VIII (15) and Problem No. IX (08). 3. Cost of grading is high High cost of grading is problem No. I, according to 1farmer No. II (9), No. III (11), No. IV (18), No. V (8), No. VI (19), No. VII (25). 4. Charges of commission agents is High This marketing problem has been considered as problem No. I by 18 respondent farmers, No. II by 14 farmers, No. III by 20 farmers, No. IV 109 farmers, No. V by 28 farmers, No. VI by 6 farmer and No. IX by 5 farmer.

122 5. Transport Cost is High Five respondent farmer has considered this as problem No. I and 6 farmers have found it as problem No. VII. 6. Insurance cost is high This is considered as problem No. I by 8 farmers, No.II (12), No. III (18), No. IV (08), No. V (15), No. VI (99), No. VII (35) and No. VIII (05). 7. Inadequate Market Information This problem has been mentioned by all 200 respondent farmers of which, 40 have ranked it as problem No. I, 20 as problem No. II, 28 as problem No. III, 35 as problem No.IV, and a maximum of 42 farmers have ranked it as problem No.VII, and a minimum of 10 farmers as problem No. V and VIII. 8. Weighment of Dry Chilly is Faulty This is consider as an important marketing problem by 200 respondent farmers of which, 8 farmers considered it as problem No. I, 15 as problem No. II, 12 farmers found it as problem No. III and so on. 9. More samples of the Farmers’ Produce are taken by the Merchants This results in loss of earnings of the farmers. Hence all the 200 farmers have considered it as a marketing problem of which, ten have ranked it as problem No. I, 20 as problem No. III,15 as problem No. IV and a maximum of 80 farmers have ranked it as problem No. VIII. 10 Pricing is Faulty and Cost of Production is not considered by Buyers This marketing problem has been considered as problem No. VIII by 15 farmer‟s and problem No. X by 45 farmers. The adjoining table provides the details of the responses of the farmers about the marketing problems and the ranks of problem given by the respondent farmer‟s are shown in the following table.

123 Table No. : - 5.17 Marketing problems [No. of farmers] S.no Factors I II III IV V VI VII VIII IX X Total 1 Inadequate storage and high 65 14 70 17 - - 06 26 0 - 200 cost of storage 2 2 High cost of packing material 28 79 29 - 06 30 05 15 0 - 8 3 Cost of grading is high 01 09 11 18 08 19 25 - - - 91

4 Charges of Commission Agents 18 14 20 109 28 06 - - 0 - is high 5 5 Transport cost is high 05 - - - - - 06 - - - 11

6 Insurance cost is high 08 12 18 08 15 99 35 05 - - 200

7 Inadequate market information 40 20 28 35 10 15 42 10 - - 200

8 Weighing at chilly is Faulty 08 15 12 25 90 30 - 20 - - 200

9 More samples are taken by 10 - 20 15 20 - 80 4 - 200 merchants 5 10 Pricing is faulty and cost of 20 15 - 45 60 production is not considered by the buyers Total 183 163 208 227 177 219 119 171 6 45 0 Source: Field Survey

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124 Chapter – VI Summary of Findings, Conclusions and Suggestions

The present study is a micro analysis of the production and marketing of oilseeds with special reference to Chilly crop in two province of Navalgund taluka of Dharwad district. The analysis has covered 200 Chilly crop growing farmers in the Ten Villagesof two province of Navalgund taluka. The respondent 20 farmers each in the two provinces of Navalgund taluka were interviewed with a well structured interview schedule covering different aspects of production and marketing dimensions. The findings based on the responses of the farmers have thrown light on the economic management of the farms growing chilly crop and the marketing issues involved in their sales organization. The social background of the farmers has a bearing on their economic strength and weaknesses. Hence details obtained from them on their social aspects like family size, caste and religious affiliations, sex and age composition etc have been analysed in detail. There is a predominance of Hindu religious group among the respondent farmers which is in tune with the demographic characteristics of the region. Family members working on the farm has been a striking feature since it has impact on the limited use of hired workers in the farm operations. Educational status of the respondents has its impact on the efficiency in the management of production and marketing of the produce. On production front the information on size of holdings, nature of land in terms of soil, irrigation etc have been analysed to provide a background to the production efficiency, productivity of land etc. Data collected on the output and yield per hectare have been useful in ascertaining their impact on the income earnings of the respondents‟ families. Cost constituents of production in terms of labour, inputs and overheads have been ascertained and their magnitude in

125 relation to per acre output have been analysed in detail. Comparisons have been provided about these different constituents in the production. The related aspects of employment of labour have been analysed. On the marketing dimensions of chilly crop different aspects like assembling, packing, storage, grading, transport, channel of distribution, marketing cost finance, pricing and price trends during the five years have been analysed in detail and the major marketing problems of the chilly crop growing farmers have been analysed on the basis of the perceptions of the respondent farmers. The major findings and conclusions along with the necessary suggestions have been provided here. Findings and Conclusions: The foregoing analysis has led to the emergence of the following major observations. DRY CHILLI The chilli crop is grown from almost the sea-level up to an altitude of 1,500 metres in tropical and subtropical regions, with an annual rainfall of 60-150 cm. In India, chillies are now grown in almost all parts. At present, Andhra Pradesh, Karnataka, Maharashtra, Orissa, Rajasthan, Tamil Nadu and West Bengal account for 85.8 per cent of the total area and 89.3 per cent of the total output of chillies in the country. The chill crop does well in the tropical and the sub tropical regions with annual rainfall of 60-150 cms. Very high rainfall during its growth is harmful. Normally the sowing is done in Sept-Oct and plucking in January. The chilly plant lasts for one season only. It is plucked 3 to 4 times in the season. The rain-fed crop does well on deep, fertile, well-drained black cotton soils. Under irrigation and good manuring, excellent crops can be raised in

126 sandy and light alluvial loams as well as in red loamy soils.] The world production of chilli crop sums up to around 7 million tons that is cultivated on approximately 1.5 million hectares of land. India is the world leader in context of chilli production followed by China and Pakistan. The largest producer of chillies in the world is India accounting for 11 lakh tons of production annually followed by China with a production of around 4 lakh tons, Mexico with the production of around 3 lakh tons and Pakistan also producing 3 lakh tons of chilli every year. India also leads in the context of maximum area covered in the cultivation of chillies. India is also the largest consumer and exporter of this crop. It consumes around 6.2 million tons of chillies i.e. about 90% of the total produce of the country The major importers of chillies from India are United States of America Sri Lanka Bangladesh Nepal Mexico Canada United Kingdom Saudi Arabia Singapore Malaysia Germany There is fluctuating trends of area for dry chilli in India. It is varied from 8.36 lakh hectare in 2000-01 to 6.54 lakh hectare in 2005-06. The minimum dry chilli area 6.54 lakh hectare in 2005-06 and a maximum area is 8.80 lakh hectares in 2001-02. The production of dry chilli in India registered a minimum of 8.67 lakh tonnes in 2002-03 and a maximum of 12.36 lakh tones in 2003-04. Fluctuating trends can also be seen in yield per hectare per kg of dry chillies in India. It is varied from 1176 kgs in 2000-01 to 1551 kgs in 2005- 06. The yield per hectare per kg of chilli registered a minimum of 1176 kgs in 2000-01 and a maximum of 1607 kgs in 2004-05. The area of dry chilli in Karnataka is varied from 1.93 lakh hectare in 2001-02 to 1.14 lakh hectare in 2010-11. The minimum dry chilli area 0.70 lakh hectare in 2003-04 and a maximum area 1.93 lakh hectare in 2001-02.

127 The production of dry chilli in Karnataka is varied from 1.26 lakh tonnes in 2001-02 to 1.23 lakh tonnes in 2010-11. The production of dry chilli registered a minimum of 0.95 lakh tonnes in 2003-04 and a maximum of 1.53 lakh tones in 2002-03. Fluctuating trends can be seen in yield per hectare per kg of dry chillies in Karnataka. The yield per hectare per kg of chilli registered a minimum of 655 kgs in 2001-02 and a maximum of 1352 kgs in 2003-04. The area of dry chilly in Dharwad district is varied from 65992 hecters in 2001-02 to 41230 hecter in 2010-11. The minimum dry chilly area is 21725 hecters in 2003-04 and the maximum area is 65992 hecters in 2001-02. The production of dry chilly in Dharwad district is varied from 30865 tonnes in 2001-02 to 18205 tonnes in 2010-11. The minimum production of dry chilly is 23567 tonnes in 2005-06 and the maximum production is 51598 tonnes in 2002-03. Fluctuating trends can be seen in yield per hectare per kg of dry chillies in Dharwad district. The yield per hectare per kg of chilli registered a minimum of 465 kgs in 2010-11 and a maximum of 1275 kgs in 2003-04. The area of dry chilly in Navalgund varied from 11339 hecters in 2004-05 to 12520 hecters in 2010-11. The minimum dry chilly area 8520 hecters in 2005-06 and maximum of 19383 hecters in 2009-10. The production of dry chilly in Navalgun taluk varied from 5840 tonnes in 2004-05 to 58218 tonnes in 2010-11. The minimum production of dry chilly registered is 4984 tonnes in 2005-06 and maximum of 58218 tonnes in 2010-11. Fluctating trends can be seen in yield per hecter per kg of dry chilly in Navalgund taluk. The yield per hecter per kg of chilly registered aminimum of 465 kgs in 2010-11 and maximum of 857kgs in 2008-09. A total number of 200 farmers have been covered here for an intensive

128 study of their production and marketing operations. The profile covers information on the demographic characteristics like a sample of 20 chilly crops growing farmers have been selected from each of the ten villages in the provinces and weightage is given to large and small farmers among these selected 200 farmers. The sample size of 200 respondent farmers consists of 120 large farmers and 80 small farmers from the ten villages of the provinces of the Navalgund taluk. Small farmers are relatively less in the five villages of two hoblies in Navalgund taluk in same order. However small farmers are more in Basapur, Bhadra pur, Yamnur and Tirlapur villages respectively. Maximum number of 100 respondent farmers belonged to the advanced age group of 40 to 50 years followed by 36 farmers in the age group of 50 years and above and a minimum of 04 respondent farmers belonged to the age group of 30 to 40 years. Economically active population of farmers covered by the study is maximum. Farmers in the advanced age of 50 years and above is also substantial. The information obtained from the selected 200 respondents indicated that all of them were male farmers engaged in the production and marketing of chilly in ten villages of Annigeri and Morab provinces of Navalgund taluk of Dharwad district. This trend is obviously in conformity with the traditional pattern of male oriented occupation of agriculture in the country. It is significant to note that maximum number of 78 farmers had only secondary education followed by 71 and farmers with primary education. However 14 farmers had other type of educational background (i.e.. higher & others). The maximum number of 10 respondent farmers in Nalavidi village had

129 primary education followed by 09 farmers in Halkusgal and 08 farmers each in Basapur, Saidapur and Shirkol of two Hoblies in Navalgund Taluka. Hallikeri with 11 farmers had maximum number of respondents with secondary education folled by Basapur, Tirlapur. Shanwad villages with nine farmers each in two Hoblies of Navalgund taluk. The maximum number of 05 respondent farmers each in Yamnur and Shanwad villages had higher education followed by 04 farmers each in Bhadrapur, Nalavadi and Tirlapur of two Hoblies in Navalgund taluk. Basapur, Nalavadi, Yamnur and Shirkol villages had two farmers each with other education Qualification followed by remaining five villages 01 farmers each in the two hoblies of the Navalgund taluk. The majority of respondent farmers had primary and secondary education which naturally had good impact on their educational efficiency. It is found that none of the 200 selected respondent farmers were illitrate which is an encouraging factor. The total number of male members of the 552 farmers are in 10 villages of Annigeri and Morab provinces of Navalgund taluk of Dharwad district. While the total number of female members was 496. The total number of children of the 404 are selected from the farmers of the ten villages of Annigeri and Morab provinces of Navalgund talukas. Caste wise distribution of the 200 selected farmers indicate that maximum number of 155 respondents belonged to castes which are included in General Merit Categories as per Government rules followed by 20 farmers belonging to scheduled castes, 11 farmers belonging to scheduled Tribes and 14 farmers belonging to the other categories. The occupation of all the 200 selected farmers was agriculture. Maximum number of 156 farmers covered by the study had an annual income of Rs.50000 or below it. A smaller number of 31 respondent

130 farmers had an annual income of Rs.50000 to Rs.100000. A still smaller number of 13 respondent farmers had an annual income of Rs.100000 and above. The respondent farmers owned residential buildings, vehicles, livestock and lands etc. indicating their investments in such assets. All the two respondent farmers owned their residential houses except four farmers in Annigeri and Morab provinces who stayed in arented house. All the respondent farmers owned three types of Live stock viz Bullocks, cows and Buffaloes, maximum number of 338 Bullocks was owned by the 200 farmers covered by the study.The number of cows and Buffaloes owned by them was 254 and 164 respectively. The 100 respondent farmers in five villages of Annigeri provinces owned 65 carts, 50 tractors and 75 Twowheelers. The 100 respondent farmers in Morab province have owned 75 cart, 65 tractors and 70 Twowheelers and others in the both provinces are 725 in total. The 200 respondent farmers in ten villages of Navalgund taluk of Dharwad district cultivated a total of 4052 acres of land. The 100 farmers in Annigeri province covered by the study had maximum of land with black soil (1942 acres) followed by farmers in Morab province with 2110 acres of black soil. No farmers in the province of the taluk was covered by the Red soil. All 200 respondent farmers have devoted a maximum area of their lands for growing dry chilly compared to other crops. The remunerative price and Higher income from the crop is the major factor for devoting maximum area of their lands for growing this commercial crop. The taluka has its main APMC in Annigeri located on an area of 25.03 acres has a jurisdiction over the Navalgund taluk. The Annigeri APMC has four sub markets ie Navalgund, Morab, Shelavadi and Hebbal by covering

131 149746 hecters of Cultivable area. The total income of Annigeri APMC reached its maximum level of Rs13989084.32 in 2010-11 but went down to a minimum level of Rs10577027 in 2009-10. The highest savings were at Rs4795938 in 2010- 11. The study covered a total number of 459 market intermediaries in the Annigeri APMC of the Navalgund taluk in 2009-10 and it went upto 600 in 2011-12. The educational status of the respondents indicates that 8 % intermediaries covered by the study were Degree graduates. But no intermediaries were belongs to primary education. It is found through personal interview that zero respondent market intermediaries belonged to scheduled tribes while majority of 09 market intermediaries belonged to „general‟ categories and 01 respondents belonged to other caste groups. All the 10 respondent market intermediaries are working in the respondent APMCs and further all of them are holding licences from their APMCs. The respondent of the market intermediaries indicate that the competition in their profession is normal and minimum. A 65 % of the purchases are made by mills while seed companies and seed merchants account for 15 percent and seed cost percentage is 20. All the 10 market intermediaries are unanimous in their opinion on this aspect. The respondent market intermediaries have asserted that they arrange for immediate sale and immediate payment to the chilly growing farmers. The respondent market intermediaries are unanimous in their opinion that the price of dry chilly is determined by the buyers, especially by oil mills. The area under cash crop crop of the 200 farmers of the ten villages in two provinces of Navalgund taluka of Dharwad district has remained almost stable during the seven years from 2003-04 to 2009-10.

132 The total area under Dry Chilli of 200 farmers varied from a minimum of 620 acres in 2006-057 to a maximum of 665 acres in 2009-10 in Annigeri province of Navalgund taluk. However it varied fram a minimum of 721 acres in 2008-09 and a maximum of 755 acres 2003-04 in Morab province of the Navalgund taluk. The total output under Dry Chilli of 100 farmers in Annigeri province varied from a minimum of 1620.24 Qtl in 2004-05 to a maximum of 2698.41 Qtl in 2008-09. However the output of Morab province varied from a minimum of 1998 quintals in 2004-05to a maximum of 3136.35 quintals in 2008-09 in Navalgund taluk. It is noted that the output of chilly crop in all two provinces has declined countinuously during the first three years. The yield per hecter of dry chilly in Annigeri province varied from a minimum of 258 kg in 2004-05 and a maximum of 429 kg 2008-09. However it is varied from a minimumof 270 kg in 2004-05 and a maximum of 435 kg 2008-09 in Morab province of Navalgund taluk. It is noted that the yied per hecter of dry chilly has been more in Morab province as compared to Annigeri province in 2008-09[ie 435 kg per hecter] in the Hoblies of the Navalgund taluk. The cost of production relate to the tilling of the land, manuring, cleaning of the cropped area, sowing, irrigation, crop cutting and harvesting. The input costs relate to the cost of seeds, water and electricity used and manure. Other costs related to production include vehicles maintenance, rentals of harvesting machines and salary of regular workers. The cost tilling ranges mentioned by the respondent farmers are Rs. 750 or less, Rs.751 to Rs.1500 and Rs.1501 and above per acre. Maximum number of respondent farmers in the ten villages of two provinces of the Navalgund taluka has mentioned that the labour cost of

133 sowing of chilly crops per acre varied between Rs.200 and Rs.400. The labour cost of cleaning the standing crop of chilly per acre was Rs 300 and below is 02 and 01 each in Annigeri and Morab province Rs 300 to Rs 600 according to 44 and 50 farmers in Annigeri and Morab province. However 54 and 49 farmers in Annigeri and Morab province is asserted that the labour cost of cleaning in chilly crop per acre was Rs 600 and above. The labour cost of cutting the harvestable crop of chilly was estimated at Rs 400 to 800 per acre by 09 and 12 respondent farmers in Annigeri and Morab province. However 64 and 59 farmers in Annigeri Morab province asserted that Rs 800 to 1500. Where as Rs 1500 and above was affirmed by 27 and 29 farmers in Annigeri and Morab province. Non of 200 farmers have indicated the crop cutting cost of Rs 400 and below. The cost of seeds per acre of chilly crop was mentioned between Rs 252 to Rs 325 by 58 and 66 farmers in Annigeri and Morab provinces. However the highest level cost of Rs 325 toRs 400 was mentioned by 31 and 46 farmers in Annigeri and Morab province. The highest cost of seeds of Rs 400 and above was mentioned by 11 and 08 farmers in Annigeri and Morab province. The minimum current value of land owned by the farmers varied between Rs 200000 to 300000 per acre as mentioned by 12 and 21 farmers in Annigeri and Morab province and a maximum current value of land for Rs 400000 and above per acre is mentioned by 47 and 40 farmers in Annigeri and Morab province of Navalgund Taluk. The value of agricultural implements of farmers was mentioned at Rs.40000 or less by a maximum number of 18 respondent farmers each in Annigeri and Morab province. However a maximum number of 49 and 42

134 farmers each in Annigeri and Morab province has estimated the value of implements at Rs.40000 to Rs.60000, and 33 and 40 farmers estimated the value at Rs.60000 and more The respondent farmers have obtainerd a loans for their other productional purposes at a varying rate of interest from 6% to 14% per annum. The respondent farmers have obtained loans from banks for purchase of tractors. Such banks include State Bank of India, Primary Land Development Bank, Co-operative Banks and other commercial banks. The respondent farmers have raised their working capital funds from three main sources viz. own funds, banks and others. It is revealed that 89 farmers obtained working capital from banks to tune of 40% or less of which 40 and 49 farmers are from Annigeri and Morab province in Navalgund taluk. However 60 and 51 farmers obtained a working capital from banks to a tune of 60% of their total requirement. The chilly crop production like other agricultural products has been experimented with better techniques of enhancing productivity. The farmers have been using better seeds and better techniques of farming with proper use of manure and watering. Hence the respondent farmers were approached by the researcher about the use of innovative methods of cultivation of chilly crop. It is encouraging to find that all the 200 respondent in the ten villages of two province in Navalgund taluk confirmed that they could get adequate and quality chilly crop seed for their production activities. It is learnt from the respondent farmers in the study area that all of them did obtain expert opinion about the farming of chilly crop production. It shows their awareness about the expertise available from Government and other agencies in this direction. The personal interviews with the respondent chilly crop growing farmers

135 indicated that they did take the decision of growing chilly crop after observing the market trends about the demand and price for the product. But in case of dry chilly all 200 farmers of 10 villages in two province mentioned that they did not follow the policy of growing the chilly crop on the basis of market demand and price level of the produce. All the selected farmers in the 10 villages of two province of Navalgund taluk has affirmed that they raised a single crop of chilly in a year. The data collected from the respondent farmers in the ten villages of Annigeri and Morab province have revealed that a total number of 598 male members of the families of the 200 farmers have been engaged in the production activities of the chilly crop farming. Province wise 277 and 321 male members of the farmers worked on the farms in the ten villages of Annigeri and Morab provice in Navalgund taluk. 261 and 307 female woprkers are engaged in growing the chilly crop in 10 villages of Annigeri and Morab province in Navalgund taluk. In addition to this 438 children were also engaged. The 200 respondent chilly crop farmers had employed 886 casual labourers. The total number of regular hired workers was 499.The total number of hired workers employed during the season was 1736.

The wages varied between a minimum of Rs.70 per day to a maximum of Rs.90 per day as mentioned by 148 respondent farmers in the ten villages of Annigeri and Morab province in Navalgund taluka. However 52 farmers mentioned that the wage rate per day for the hired workers was Rs.90 to Rs.100 in Annigeri and Morab province of the Navalgund taluk. The important aspects covered for the analysis include the assembling of the produce by the farmers after the harvesting is over and the cost and duration of assembling etc. Next the storage and cost of storage and also the duration and location of storage has been discussed with the necessary

136 statistical data obtained from the respondent farmers. The various aspects of marketing of chilly crop in the study area have been analysed strictly on the basis of the views and responses of the selected 200 farmers engaged in the production and marketing of chilly crop in their respective areas. The responses have been identical from all the 20 respondents each in all the ten villages in Annigeri and Morab province in Navalgund taluk of the Dharwad district covered by the study. The responses of the 200 selected farmers in the 10 villages as have indicated that the cost of assembling of chilli is Rs 10 to 15 per bag. The 20 respondents each in the 10 villages have indicated that the minimum and maximum period of keeping their assembled chilli is a minimum period of 1 month and a maximum period of 6 months. The storage options for the chilly crop farmers are the Government warehouses, private warehouses and APMC warehouses. The farmers have indicated more than one option since they could not avail of only one of the options of storage due to inadequacy of space. All 200 respondent farmers have affirmed the uniform storage cost of Rs.25 per bag per month. All the 200 respondent formers of chilly crop of all ten villages have affirmed the uniform period of keeping their chilly produce in the storage was 3 to 6 months. All the 200 respondent farmers have affirmed the use of gunny bags for packing the produce before the same is sold in the market. The respondent farmers have exercised two options of locations for the sale of chilly crop. Sales have been taking place locally as well as at APMC yards. The local sales of dry chilly take place due to prior commitment of the farmers with the local merchants based on prior advances received by the farmers.

137 All 20 respondents each in the ten villages of two provinces of in Navalgund taluka have indicated that the need for immediate cash compelled them to sell their chilly crop produce locally. Repayment of old debt to merchants and moneylenders also compelled all the 20 respondents each in the 10 villages to sell their produce locally. They compelled them to sell locally was to avoid the transport cost in carrying the produce to APMC. All the 20 respondents in each villages of two provinces have also mentioned that the local sales of dry chilly by them were due to the small quantity and storage difficulties of the produce. The responses of the 200 farmers engaged in production and marketing of cash crop sell their produce through commission agents and cooperative marketing societies. The responses indicate complete unanimity among all the farmers selected for the study. Majority of 60 and 54 respondents are satisfied with the channel of distribution in their sales of dry chilly. A substantial number of 40 and 46 respondents are not satisfied with the channel of distribution. The responses of the 200 chilly growing farmers indicate that they are all selling their produce in more than one market. The markets where they sell their dry chilly crop include local market and APMC. All the 100 farmers in Annigeri province sell their dry chillies in local market to a tune of 50% to 60%. The same practise is prevailing in the Morab province. Grading is generally done by the growing farmers themselves with the help of expert labuor. The annual cost of grading of chilli is Rs. 400 and above and Rs. 400 or less per quintal. The respondent farmers 200 have asserted that they did not insure their

138 produce before it was sold. Hence they did not incur any cost in insurance. The respondents suggested that the cost of insurance was high and hence they did not go in for insuring the dry chilly. A large majority of 175 farmers have used hired vehicles while only 25 farmers have used their own vehicles for transporting of their dry chilly produce in Annigeri and Morab province. The sources of market information are reports of traveling salesmen, market intermediaries like wholesalers and retailers, records of business etc. Information obtained through personal interview with the farmers revealed that the main sources of market information were commission agents, APMC newspapers and Radio and TV The respondent farmers have indicated that they have relied on their own funds and bank loans for their marketing expenditures. There is again a complete unanimity of opinion among all the 200 respondent farmers. Information collected from the respondent farmers growing chilly crops indicate that the major areas of marketing cost relate to packing, storage, transport, grading and weighing. Responses of the 200 cash crop growers covered by the study clearly indicate that they are not satisfied with the present system of price fixing for their produce. The dry chilly prices in the study area have prevailed at a steady range of Rs. 4000 to Rs. 7000 and above.This is affirmed by all 200 farmers of the two province in Navalgund taluk. Major marketing problems of dry chilly in the study area: Inadequate storage and High cost of Storage, High cost of Packing Material, Charges of Commission Agents is high, Transport Cost is high, Insurance Cost is high, Inadequate Market Information, Weighment of Cash crop is Faulty,

139 More samples of the Farmers‟ Produce are taken by the Merchants, Pricing is Faulty and Cost of Production is not Considered by Buyers and Delayed Payment by Buyers like mills and Marketing Societies.

Hypothesis and the Research Finding: The researcher‟s five hypotheses have been vindicated by research findings based on the personal interviews with dry chilly farmers covered by the study in the ten villages of the Annigeri and Morab province of Navalgund taluk of the Dharwad district. Suggestions: 1. The productivity level of the cash crops is low in the areas cultivated by the respondent owners. It is obvious that one of the main reasons for the low productivity in cash crops is the use of poor quality seed for sowing which often results in low plant population leading to lack of response to improved management practices. This calls for the use of quality seed which is the foundation of efficient and productive agriculture. High quality seed is the most remunerative input in successful crop production and also better utilization of inputs. 2. The seed productivity can be enhanced through the following measures. i. Bringing more oilseeds area under protective irrigation. ii. Integrated nutrient supply and management. iii. Efficient crop management practices starting from adoption of proper crop rotation. iv. Suitable soil and moisture conservation practices. v. Timely planting, timely weed management and need based crop protection. 3. It is found that the seed rate is very high (100-120 kg/ha) with low yields (8- 10 kg/ha), the seed multiplication ratio is very low (1:8) compared to other

140 crops. This is serious constraint in cash crops for faster coverage of improved seeds of cash crops. There is therefore, need to make use of all the viable seeds in cash crops to minimize the cost of the seed and to cover more area under high yield. 4. It is necessary to ensure timely supply of inputs at economical cost and to provide for plant protection measures and take steps for aggressive extension. 5. Efforts should be directed towards increased productivity through development of suitable verities for different agro-climatic zones by applying recommended fertilizer and pesticides. Concerted efforts should be directed towards strengthening research and extension system. Technology break through achieved incase of certain crops like rice and wheat is yet to touch cash crops. 6. Dependence on rain fed cultivation of cash crops should be reduced Measures should be initiated to increase irrigation facilities for cash crops farming during rabi season. Research studies have shown that cost benefit ratio was higher in terms of net income, farm business income, family labour income and farm investment income on irrigated farms compared to rain fed farms. 7. Market scenario for cash crops reflects some major hurdles particularly for the small village farmers who are not capable of integration of their marketing operations with the urban assembling centres. The local sales of cash crops at the village level are still ramphant and substantial. The major factor causing local sales is the financial limitations of the farmers. These small cash crops growing farmers have prior financial commitment with the local merchants and money lenders who advance money to the farmers on the tacit understanding that they should sell their produce to them only. Generally such sales are made at an unremunerative low price. The farmers invariably suffer loss of income. Local sales also take place when the

141 farmers are hard pressed for cash requirement or when the quantity of cash crops is small or when the farmers cannot afford to meet the transport cost of taking the cash crops to APMC. All these factors result in local sales and loss of income to the cash crops producers. Hence there is need for reducing the local sales by arranging bank finances to these farmers. The APMC can play a more active role in this direction to minimize the incidence of local sales and the consequent loss of income of the cash crops growers. 8. There is need for arranging cheaper means of transport for lifting the cash crops produce from the premises to assembling market. APMCs should arrange for the cheaper transport facilities so that there can be more inflow of cash crops at the market yard which would be useful to both the farmers and the APMC. 9. Storage facilities are found inadequate and this may reduce the retention capacity of the cash crops growers for a better price at a later date. They will be forced to sell their produce at a un-remunarative price. Hence the government agencies and the APMCs should try to provide greater facilities of storage at lower cost. 10. There is need for organizing alternative channels like marketing and processing cooperatives to operate in the market to create price competition in different channels to provide better decision-making. 11. The intervention of government and corporate bodies like oil federations National Dairy Development Board etc. would be helpful in increasing the market competition and also in reducing the disparities in distribution of marketing margins among intermediaries by stabilizing the price trend to some extent. 12. It is necessary to retain commission agents as an alternative. However there is a need for effective enforcement of market regulation for cash crops marketing declaring the crop as a notified commodity. 13. Providing of adequate marketing finances at economical cost is necessary

142 for making the cash crops marketing as profitable one. 14. It is necessary for the government agencies and the APMCs to bring down the overall level of marketing costs in the areas of storage, packing, transport grading and payment of charges to commission agents. 15. The farmers and the APMCs should try to enhance the value addition of cash crops through proper processing of seeds so that the farmers can get a better price for their produce. 16. The marketing mal practices like faulty weighing of the produce, taking excess samples from the farmers sales stock, and excessive charges of commission agents excluding excessive quantity of cash crops on grounds of damage etc. should be properly dealt with by the regulated markets. 17. Proper market information to the cash crops growers should be disseminated through proper channels by the APMCs and the government agencies. 18. The delay in payment of the sale proceeds to the farmers by the buyers like oil mill units; commission agents etc. should be prevented by the APMCs and the government. 19. To meet the challenges of cash crops in general and cash crops in particular in the post WTO regime there is need to adopt multi-prongd strategy. This involves; i. Enhancing cash crops production through area expansion and ii. Productivity improvement through better adoption of improved technology iii. Value addition to cash crops and oils to increase their consumption. iv. Overcoming the constraints of domestic marketing of oils seeds and its products and Liberalising trade in oil seed economy. Major increase in area under oilseeds is possible through introduction of cash crops as intercrops in widely spaced crops and through crop intensification. Where there is limited scope for bringing additional area

143 under oilseeds the bulk of future increases in oilseeds production have to come primarily from land saving technologies highlighting a combination of high yielding plant type and balanced crop nutrition. 20. An optimal balance has to be struck by the policy makers in cash crops processing sector. Efficiency and economy should not be sacrificed at the time of employment creation. Modernization to the oil seed processing industry should be encouraged. There is need to remove all barriers regarding processing, storage and movements of cash crops. 21. To enhance the efficient and effective marketing of cash crops, the production strategy of cash crops should involve the following components. i. Delineating efficient zone for different oil seed crops through crop ecological zoning. ii. Adequate supplies of quality seeds of improved varieties and hybrids. iii. Bringing more cash crops are a under protective irrigation. iv. Integrated nutrient supply and management. v. Efficient crop management practices starting from adoption of crop rotation, suitable soil and moisture conservation practices vi. Timely planting vii. Adequate plant stands through adjustment in seed rate and thinning. viii. Timely weed management ix. Need based crop nutrition Timely harvest and safe storage. All these will go a long way in enhancing productivity of cash crops. ********

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29. M. M. Bhalerao Santkumar and D.N. Prasad – Input use Efficiency in India Agriculture – A case study of Vegetables and Oil Seeds Indian JL of Agri. Econ. July-Sept. 1992, Vol. No.47, No.3 p486

159 30. Nagaraj G. - Journal of Oil Seeds Research – Indian Society of Oil Seeds Research – Directorate of Oil Seeds Research, Rajendra Nagar, Hyderabad,Vol. No.19 No.1, June 2003, p8-16.

31. Palanichamy S. – Spice India – Spices Board P.B. No. 2277, Cochin- 682025, Vol. No.15 No.1, Jan. 2002, p12.

32. Dr. Pal Singh Ved – Crop Research – The Gaurar Society of Agriculture Research. Information Centre, Hisar, India, Vol. No.29 No.2, March 2005, p30-35.

33. Dr. Shankaran R. – Indian Oil Seeds Journals Indian Central Oil Seeds Committee, Gandhi Bhavan, Hyderabad (DN) , Vol. No.19 No.1, June 2002, p17.

34. Dr. Sheelavantar M.N. – The Mysore Journals of Agricultural Science – Agriculture University, Bangalore, Vol. No.30 No.4, April 2004, p18

35. Dr. Shankaran R. – Indian Oil Seeds Journals – The Indian Central Oil Seeds Committee, Hyderabad, Vol. No.15 No.5, Jan-March 2004, p16.

36. T.N.Prakash Srijay Devaraj Urs (1998) – Impacts of Cooperative on market structure and prices. The case of centre Groundnut and Processing Cooperative Ltd. Karnataka Indian JL of Agri. Eco. Vol. No. 53 No.3, July 1998, p450.

37. Dr. Vedpal Sigh – Crop Research – The Gaurav Society of Agriculture Research. Information Centre, Hisar, India, Vol. No.15 No.5,May 2003, p14-16.

38. Wasnik M.B. – Oil Seeds Journals Quarterly, Maharashtra State, Vol. No.XII,Jan.-Dec. 1982, p18-20.

160 ARTICLES 1. Anuraga Mishra – Yojana – Yojana Kannada Prakashana Section, Singh, Kendriya Sadana, Koramangala, Bangalore, Vol. No.21 No.8, 2005 March, p5-6.

2. Prof. Bajapai AND – The Indian Economic Journal Awadhesh – Partap Singh University, Rewa(MP), Vol. No.51 No.2, July-Sept. 2003-04, p3.

3. Chawla Prabu – India Today – N.S. Ramarao General Manager, Mumbai, Vol. No.32 No.5, May-June 2004, p15-18.

4. Dr. Kanthan P.S. – Thambi – Spice India – V.K. Krishna Nayar, Vol. No.32 No.2, Feb.-March 2003, p18.

5. Dr. Hegde D.M. – Oil Seeds Becoming Self Reliant – The Hindu Survey of Indian Agricultural 2004 – pp. 45 – 47.

6. Lindner Bob – Dave Pannell Ross King well Agriculture and Resource Economics Block Well, Asia, Vol. No.35 No.6, June 2005, p14. 7. Puttaswamaiah K. – Applied Economics and Economics – Transactions Periodicals Consortium Rutgers – The State University of New Jersey, Vol. No.25 No.1, Jan-March 2003, p18-25.

8. Pami Dua and Partha Sen – Indian Economic Review – Dept. of Economics Delhi – School of Economics University of Delhi, Vol. No.XXXX No.2, July-Dec. 2004, p12-14.

9. Mehatra Balaraj–Quarterly Economic Report of the Indian Institute of Public Opinion–Inderjeet Rai for the Indian of Public Opinion Pvt. Ltd.Jeevan– Tara building, Sansad Marg,New Delhi,Vol. No.XLIX No.1,Jan-March 2005,p18-19.

161 10. Mishra Anurag – Yojana ( A development monthly) Joint Director(prod) N.C. Muzamdar – Cover Design – Mukal Chakravarthy vol. No. 25 No.8 Aug. 2004

11. Subramanya K.N. – Southern Economist 1st and 15th every month No. 9 – Jamiamasjid Complex. 1st floor 10 and 11 palace, Guttahalli, Bangalore.

12. Sameeksha – Economic and Political Weekly – A Sameeksha Trust Publication Hitakari House, 284 Shahid, Bhagathsingh Road, Mumbai. Vol. No.8. RJ No. 16. weekly, Vol. No.XLI No.1,Jan 7-13- 2005,p14-17.

13. Upendra M. and Venkatesh Waralu P. – Area Production and Productivity of Groundnut A Comparative Analysis of Growth and Instability Southern Economist 34(18) pp 12-14. 1996.

GOVERNMENT PUBLICATIONS

1. Director of Statistics Department, Gadag – Gadag District At A Glance – Zilla Panchayat Office, Gadag.

2. Directorate of Economics and Statistics – Karnataka At A Glance – Directorate Economics and Statistics, Bangalore.

3. Govt. of Karnataka – Dharwad District At A Glance 1986-87 – V.S. Bannimatti, District Statistics Officer, Dharwad.

4. Govt. of Karnataka – Karnataka’s Economy in Brief 1991-92 – V.S. Satyappa, Director, Directorate of Economics and Statistics, Bangalore

5. Indian Agriculture – Vikas Singhal, Indian Economic Data Research Centre, p 753-764, 2003.

162 6. Reports of the Commission for Agricultural Cost and Prices for the crop shown during 2000-01 Season, - Department of Agriculture and co- operation Ministry of Agriculture, Govt. of India, New Delhi. P 135 – 279, 2000-01

7. Statistics Department, Bangalore – Fourth Economics Census (Provisional Result Gadag District) – Directorate of Economics and Statistic, Bangalore, 2000.

8. State Focus Paper 2005-06 Karnataka – National Bank for Agriculture and Rural Development Regional Office, Bangalore, Karnataka, p. 95– 104, 2005-06.

ANNUAL REPORTS

Annual Report -A.P.M.C.,Annigeri (Navalgund Taluka) -A.P.M.C.,Annigeri , 2003-04 to 2009-10. .

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163 MARKETING OF CHILLY IN NAVALGUND TALUKA IN THE STATE OF KARNATAKA

Questionnaire Schedule

(For Farmers)

A - General Information about the Farmer (Big/ Small)

1. Name 2. Place:

3. Taluka 4. Sex: Male / Female

5. No. of family members : Male______Female______Children ____ 6. Age 7.Education : Primary/secondary/PUC/Diploma/ Degree/PG/Others 8. Main Occupation : Agriculture / Trade/ Service/ Industry/ Others 9. Subsidiary Occupation: 1)______2) ______3)______10. Annual Income of the family : From main occupation Rs. ______From subsidiary occupation Rs.______11. Caste ______12. Religion ______13. Martial status : Married / Unmarried

PROPERTIES DETAILS 1. Residential House : (i) Owned (ii) Rented ii) Farm House – Yes [ ] No[ ] 2. Livestock: i)Bullocks No‟s ___ ii)Cows No‟s ___iii)Buffalo No‟s____ 3. Vehicles: i) Cart No‟s _____ ii) Two Wheelers No‟s _____ iii) Tractors No‟s ____ iv) Trucks No‟s _____ v) Tempo No‟s _____ vi) Others No‟s ____ B - Land And Production 4. Lands A i.) Owned Acres _____ ii) Rented Acres_____ iii) Total Acres _____ B. I). Red Soil Acres ____ ii) Black Soil Acres___ iii) Others Acres ______C. i) Irrigated Acres _____ ii) Non-Irrigated Acres _____

164 5. Types of Cash Crops Grown

Crop Acres Red soil Black soil Irrigated Non-Irrigated Chilli Cotton Groundnut Sunflower Safflower Linseed Castor

6. Production of Cash Crops Production 2003- 2004- 2005- 2006- 2007- 2008- 2009- 04 05 06 07 08 09 10 Ground nut

1.Area Acres 2.Area Output

(Quintals)

3.Yield / Acre (Kg/ Quintals) Chilli

1.Area Acres 2.Area Output (Quintals) 3.Yield / Acre (Kg/ Quintals) Cotton

1.Area Acres 2.Area Output (Bale) 3.Yield / Acre (Kg)

165 7. Cost of production per Acre/ Quintal Groundnut Chilli Cotton

I. Labour 1. Tilling and manuring

Sowing

2. Cleaning the crop etc

3. Irrigation work

Crop cutting

4. Harvesting

II. Inputs

1. Seeds 2. Manure 3. Water & Electricity for irrigation 4. Pesticides III. Over Head 1.Rentals for hired vehicles 2. Rental for harvesting machinery 3. Rentals for Hired lands 4. Interest on known for agriculture production 5. Electricity for Farm house 6. Salary of regular worker 7. Petrol and Diesel cost of owned vehicles 8. Others

D. Investment in Farm Equipments Provide details about your Investment in the following: 1.Total acreage of land owned Acres ______Current value of the Land owned Rs._____

166 2. Vehicles Agriculture Machinery and Farm House i) Cart____ No.s_____Value Rs.______ii) Agricultural Implements ValueRs.______iii) Tractor No.______Value Rs.______iv) Farm House No._____ Value Rs.______v) Trucks No. ______Value Rs.______vi) Harvesting Machine Value Rs. ______vii) Irrigation Pumpsets Value Rs. ______viii) Pestcidie Sprayer Value Rs. ______ix) Storage for Farm Produce Value Rs. ______x) Others E. Finance for Investment 1. Have you Obtained Loans for financing the above Investments. Yes [ ] No [ ] If yes specify Source Sl.No. Purpose of Amount of Interest Amount Loan Loan Rate Repaid Percentage (Rs.) 1 Purchasing of Tractor 2 Harvesting machine 3 Irrigation Borewell 4 Irrigation Pump sets 5 Cart 6 Leave Stock 7 Farm house 8 Purchasing of Land 9 Others

2. Have you obtained loans from other sources in addition to the above for your investment in farm of operations : equipments? Yes[ ] No[ ]

167

3. If yes specified.(Money lenders/Friends/Relatives/Finance corporation)

Sl.No Purpose of Source of Amount of Interest additional additional Loan Loan (Rs.) Rate Loan Percentage 1 2 3 4 4. Working capital How do you finance your working capital requirements for your farm operations specify? 1) Own funds 2) Banks 3) Private money Landers 4) Friends and Relatives 5) Finance corporation etc. 6) Others 5. Specify your dependents for working capital on each source?

Source Percentage Own Funds Banks Money Landers Friends / Relatives Finance Corporation Others Total 100

F. 1. a) What factors do you consider while deciding to grow Cash Crops in general groundnuts in particular on your farm specify and rank them Sl.No. Factors Rank 1 Good unit price 2 Low unit cast of production 3 Low requirement of water 4 Less enable to pests and disease 5 More demand in the market 6 Soil is more suitable for the Cash Crops. 7 Low Requirement of manure 8 Low labour requirement 9 Crop duration is less 10 Produce is not perishable 11 Others

168 2. Do you follow new and innovative method of cultivation of Cash Crops? Yes [ ] No [ ]

3. Do you get adequate and quality seeds of Cash Crops? Yes [ ] No [ ]

4. Do you avail of experts a advice in your farming of Cash Crops? Yes [ ] No [ ]

5. Do you alter the acreage of land under Cash Crops on the basis of market trends and price changes? Yes [ ] No [ ]

6. How many crops of Cash Crops do you grow in year? One [ ] Two [ ] Three [ ]

G. Employment 1. How many member of your family work on your farm? Specify

Male Female Children Total No. of members Working on the Farm

2. How many hard workers do you employ the cultivation of Cash Crops? Specify

I) Casual No.s- II) Regular No.s- III) During Session No.s-

3. Do you require skilled workers for cultivation of Cash Crops? Yes [ ] No [ ] If „yes‟ how many of them do you required? No.s ______

4. What is the rate wags paid of hard workers? Rs. ______per day per child

5. What is the annual Cost of labour for cultivating Cash Crops per acre Rs.______?

169 MARKETING OF CHILLY IN NAVALGUND TALUKA IN THE STATE OF KARNATAKA

ASSEMBLING

1. Where do you assemble your cash crops after the harvesting? Farm House [ ] Store Room [ ] Residential Area [ ] Rented Premises [ ] Others [ ]

2. What is the annual cost of assembling your produced? Rs.______

3. What is the duration of keeping the produced assembled before shifting them to storages? 1 week [ ] 2 weeks [ ] 1 month [ ] more than 1 month [ ]

PACKING 1. How do you pack your produced of cash crops? Gunny Bags [ ] Synthetic Bag [ ] Others [ ]

2. What is the annual cost of packing cash crops ? Rs. ______

STORAGE 1. Where do you store your cash crops before sale? Govt. Warehouse [ ] Private warehouse [ ] APMC warehouse [ ] Others [ ] 2. What is the annual cost of the storage? Rs.______

3. Do you get adequate storage facility Yes [ ] No [ ]

4. What is the average period of storage of the produced before the annual sale of the produce? One Week [ ] Two Week [ ] One Month [ ] More Than One Month [ ]

170 LOCATION OF SALES 1. Where do you sell your cash crops? Locally [ ] APMC [ ] Outside Taluk [ ] Out side District [ ]

2. If you are selling locally give reason. i. Need for immediate cash ii. To repay old loans to merchants / money lenders / others iii. To ovoid transport cost to carry the produced to APMC iv. The quantity of produced is too small to take it to APMC / outside the local place

3. If you are selling through APMC give reasons i. APMC ensures better price ii. APMC provides facilities for storage iii. APMC provides facilities for grading iv. APMC provides facilities for proper weighing v. APMC provides facilities for better market information vi.

4. If you are selling your produced outside taluka or district give reasons i. Mills in outside areas offer better price for the cash crops. ii. Advance money is given for the produce. iii. Waiting for better price is avoided. iv. v.

CHANNELS OF DISTRIBUTION 1. What is channel through which you sell your cash crops? Channel Percent 1. Whole sellers 2. Commission agents 3. Cooperative marketing society 4. 5.

171 2. Are you satisfied with the channel of distribution through whom you are selling your cash crops? Yes [ ] No [ ] If No, Specify reasons i. Delay in payment ii. Excess commission on sales iii. Taking excess samples iv. Faulty weighing v.

3. Do you sell at more than one market? Yes [ ] No [ ] If yes give details

Market Percent Local Sales APMC Out side Taluka Directly To Oil Mills Out side District Other 100

GRADING

1. Do you grade your cash crops before selling? Yes [ ] No [ ] 2. If yes who does the grading i. Government licensed graders ii. Private graders iii. APMC nominated graders iv. Wholesalers/commission agents grader v.

172

3. How is grading beneficial to you? i. Ensures better price ii. More sales receipts iii. More demand iv.

4. What is the annual cost of grading? Rs.______

INSURANCE 1. Do you insure produce before sales? Yes [ ] No [ ] 2. If yes what is annual cost of insurance? Rs.______Yes [ ] No [ ] 3. If no give reasons No need [ ] insurance cost is high [ ]

TRANSPORT

1. What type of transport do you use to carry your cash crops to market for sale? Truck [ ] Tractor [ ] Cart [ ] Rly [ ] Other (specify) [ ]

2. Do you use your own vehicles? Yes [ ] No [ ]

3. If no do you use hired vehicles? Yes [ ] No [ ]

4. What is the annual cost of transport for marketing your cash crops? Rs.______MARKETING INFORMATION 1) Where do you get market information on price, demand, etc. for selling your produce? i. Wholesale merchants ii. Commission agents iii. APMC

173 iv. News Papers v. Radio/TV vi. Friends / Relatives

2) Do you incur any cost on getting information?

3) If „yes‟ what is the annual cost Rs. ______

4) Are you benefited by marketing information? Yes [ ] No [ ]

5) If „yes‟ specify i. Can get better price ii. Can get proper channel of distribution iii. Can choose proper buyer iv. Can avail of government facilities of support price etc.

MARKETING FINANCE 1. Don you require finance for marketing your cash crops? Yes [ ] No [ ] 2. If Yes mention the purpose for which you need finance

Purpose Payments per Year (Rs.) i. Storage ii. Grading iii. Transport iv. Payment of cess-tax etc. v. Insurance vi. Travel expenses for getting Market information etc. vii. Agents Commission viii. Packaging ix.

3. How do you raise finance?

Source Percent i. Own funds ii. Bank loans iii. Advance from traders iv. Friends/Relatives v. Money lenders vi. Others

174 MARKETING COST

1. What is the total cost of marketing cash crops per year? Rs.______2. Give details Cost item Amount i. Packing ii. Storage iii. Transport iv. Insurance v. Government and APMC cess vi. Grading vii. Market information travel phone etc. viii. Agents commission ix. Others Total PRICING 1. How is the price fixed for your cash crops? i. As per prior agreement with buyers ii. Fixed by whole sale merchants iii. Fixed by commission agents iv. Fixed by mills v. Fixed by government vi. Fixed by co-operative marketing society vii. Fixed by market supply and demand

2. What is your role in fixing the price of cash crops? i. Assert a price with buyers through bargaining ii. Accept the price prevailing in the market iii. Leave the decision to commission agent/whole sale merchants iv. Accept the APMC decision v. Accept the Government rates vi. Accept the price offered by Mills vii. Others (Specify) ______

3. Do you consider the present system of fixing price is reasonable? Yes [ ] No [ ] 4. If no give reasons

175 i. Price is not commensurate with the cost of production [ ] ii. Price is arbitrary [ ] iii. Price indicates exploitation by middle men [ ] iv. Price is not influenced by government price support policy [ ] v. Others [ ]

5. What suggestion do you offer for getting better price of the cash crops? i. Organizing cooperative marketing societies for selling the produced ii. More active role by the APMC in getting better price iii. Selling directly to oil mills and avoid the service of commission agents iv. Others v. 6. Give details of the price of cash crops per quintal? Rs……………

Price 2003-04 2004-05 2005-06 2006-07 2007-08 Per Quintal (Rs.)

MARKETING PROBLEMS 1. What are the major problems of marketing your cash crops? Rank them

Problems Rank i. Inadequate storage / high cost of storage ii. High cost of packing material iii. Cost of grading is high iv. Charges of commission agents is high v. Transport cost is high vi. Insurance cost is high vii. Inadequate market information viii. Weighment of government is faulty ix. More samples are taken by merchants x. Pricing is faulty and cost of production is not consider by buyers xi. Delay payment by buyers, mills and marketing Societies xii. Facilities of APMC are inadequate

2. How can the above marketing problem be overcome? Make your suggestion i. ii. iii.

176 MARKETING OF CHILLY IN NAVALGUND TALUKA IN THE STATE OF KARNATAKA

Questionnaire Schedule (For Intermediaries) I 1) a) Name: b) Place: c) Taluka d) Age: e) Education: f) Caste g) Religion: h) Major Occupation i) Subsidiary Occupation j) Status as Intermediary: Wholesale merchant/ Commission Agent

II Since how long are you working as Intermediary? ______Years III Are you licensed by the APMC? Yes No

IV Are you working in the APMC? Yes No

V) What Services do you provide to the groundnut farmers in marketing their produce?

Facility Owned facility Arranged From Others 1. Storage Facility 2. Packing 3. Transport 4. Grading 5. Marketing Information 6. Weighing 7. Finance in Advance 8. Insurance 9. – 10. –

VI. How do you arrange for the scale of the farmers? 1. Bring the buyers and seller together and settle the deal 2. Buy the cash crops from farmers directly and sell the same subsequently 3. Provide the necessary information to farmers about the price quantity of the cash crops demanded by the buyers.

177 VII. How much do you change for the sale transactions of cash crops to sellers and buyers i. Rs.______per quintal ii. As per the APMC rates Rs. ______per quintal

VIII. What percentage of the sales of cash crops of farmers is sold through Intermediaries? i. ______Percent ii. ______Percent

IX. What is the nature of competition among the intermediaries in the sale of cash crops? i. Severe ii. Normal iii. Minimum iv. No competition

X. Do you arrange for immediate sale and payment to farmers for the sale of their of their cash crops? Yes No

XI. Who are the main buyers of cash crops at your market area? Sl. No. Buyers Share in Percent 1 Mills 2 Seed companies 3 Seed Merchants 4

XII Who fixes up the price of cash crops in your market area? i. Buyers ii. APMC iii. Large of mills iv. Intermediaries v. Bargaining between sellers and buyers.

178