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International Journal of Agricultural Science and Research (IJASR) ISSN (P): 2250-0057; ISSN (E): 2321-0087 Vol. 10, Issue 1, Feb 2021, 21–30 © TJPRC Pvt. Ltd. PRICE SPREAD OF GUAVA IN MADURAI DISTRICT OF TAMIL NADU E. DHIVAGARAN*1, S. SELVANAYAKI2 & D. MURUGANANTHI3 1PG Scholar, Department of Agricultural and Rural Management, Tamil Nadu Agricultural University, Coimbatore, Tamil Nadu, India 2Assistant Professor, Department of Agricultural and Rural Management, Forest College and Research Institute, Mettupalayam, Tamil Nadu, India 3Assistant Professor, Department of Agricultural and Rural Management, Tamil Nadu Agricultural University, Coimbatore, Tamil Nadu, India ABSTRACT Guava (Psidium gujava L.) belongs to the family, Myrtaceae. It is believed that guava was originated from the area extending from Southern Mexico or Central America (Morton, 1987) and it is extensively grown in both tropical and sub-tropical regions. Although this fruit is grown all over the world, India tops the global production followed by Pakistan, China and Brazil. However, in India, it is cultivated mainly for local consumption with minimal processing. Original Article Thus, the value chain of guava remains highly untapped. Madurai is one of the important guava producing districts in Tamil Nadu with various marketing channels. Present study was conducted on the price spread of guava in Madurai district during 2019-20. Samples for the study namely, producers and market intermediaries were selected using random sampling technique. The necessary data was acquired through personal interview with the help of pre-tested interview schedule. It was inferred from the study that there are six predominant marketing channels present in the study area.Results of analysis showed that out of the six channels,Channel II: Producer - Commission Agent – Retailer – Consumer was the most efficientwith 28.60 per cent price spread and 71.40 per cent of producer’s share in consumer’s Rupee KEYWORDS: Guava, Value chain, Marketing channel, Price spread, Producer’s share in consumer’s Rupee Received: Dec 18, 2020; Accepted: Jan 08, 2021; Published: Jan 23, 2021; Paper Id.: IJASRFEB20213 INTRODUCTION Guava (Psidium gujava L.) belongs to the family, Myrtaceae. It is believed that guava was originated from the area extending from Southern Mexico or Central America (Morton, 1987) and it is extensively grown in both tropical and sub-tropical regions. It was also well known for its traditional therapeutic benefits for diabetes, gut infection and metabolic disorder and obesity. Although this fruit was grown all over the world, India tops the global production followed by Pakistan, China and Brazil. The annual production of guava in India was around 4 million tonnes (Horticulture Statistics at a Glance, 2018). However the fruit was cultivated mainly for local consumption with minimal processing. The value chain of guava also remains highly untapped. In Tamil Nadu the area under guava was 9.69 thousand hectares and it produced 155.06 metric tonnes of guava (Horticulture Statistics at a Glance, 2018). Even though, Dindigul district stands first in production followed by Madurai, Madurai district leads in productivity (12.89 per cent) when compared with Dindigul district (9.36 per cent) (Horticulture Statistics at a Glance, 2018). Also, Madurai has good transport connectivity via all means that facilitates various marketing channels for guava. Hence the study was conducted to trace the available predominant marketing channels and to track the www.tjprc.org [email protected] 22 E. Dhivagaran*, S. Selvanayaki & D. Murugananthi most efficient channel. MATERIALS AND METHODS Multi-stage sampling was used purposively to select the producers from the area under higher guava cultivation i.e., district, blocks, villages and producers. The intermediates were selected by simple random sampling technique. The survey area consists of two blockswith six villages each.Athanoor, Ayyur, Devaseri, Eirampatti, Muduvarpatti, and Vellayampatti villages were selected from Alanganallur block and Chinnapoolampatti, Karaikeni Kilankulam, Silarpatti, Vaiyur and Vannuvelampatti villages were selected from T. Kallupatti block. Five farmers were selected from each village resulting in sixty samples.Totally, sixty intermediaries were selected for the study including twenty commission agents, fifteen local traders, twenty retailers and five exporters. Through personal interview method data were collected with the help of pre-tested interview schedule. In few cases, the produce was transferred to the exporter for export to countries such as Malaysia, Maldives, Dubai and Sri Lanka. In such cases, the exporters were considered as the terminal option in the channel. RESULTS AND DISCUSSIONS The price spread among various channels were tabulated and discussed below. Marketing Channels In the study area, the harvested guava enters various marketing channels and the predominant channels are presented in Table 1. Table 1: Marketing channels for Guava in Madurai District Marketing Costs Marketing of the produce incurs costs such as picking cost, transport cost, packing cost, labour cost, etc. Those costs differ from one channel to another. The marketing costs incurred in various channels were tabulated as follows. Table 2: Marketing cost of intermediaries in Channel I Channel I: Producer Retailer Consumer Amount (Rupees Percentage to S. No Particulars per kg) consumer’s Rupee 1 Producer Gross price received 23.00 51.11 Impact Factor (JCC): 8.3083 NAAS Rating: 4.13 Price Spread of Guava in Madurai District of Tamil Nadu 23 0.50 Picking 22.50 Net price received 2 Retailer 23.00 Purchase price Loading and unloading 1.00 2.22 Marketing cost 0.50 1.11 Transport 2.50 5.56 Margin 18.00 40.00 45.00 Sale price Price paid by customer 45.00 100.00 From the Table 2, it is observed that the transportation cost is incurred by the retailer. The retailer procures the produce from the farmer’s field. Since the retailer was able to procure from the farmer’s field, he has the upper hand in deciding the price. Also, the retailer enjoys good share of margin when selling in the market. Even though the consumer Rupee was less when compared to other channels, the retailer reaps the maximum benefit in this channel. The producer’s share in consumer’s Rupee is (50.00%) Table 3: Marketing cost of intermediaries in Channel II Channel II: Producer Commission Agent Retailer Consumer Percentage to S. No Particulars Amount (Rupees per kg) consumer’s Rupee 1 Producer Gross price received 37.00 74.00 Picking 0.50 Loading and unloading 0.40 Transport 0.40 Net price received 35.70 2 Commission Agent Purchase price 37.00 Packaging 0.50 1.00 marketing 0.80 1.60 Subtotal 38.30 Margin 3.70 7.40 Sale price 42.00 3 Retailer Purchase price 42.00 Loading and unloading 0.20 0.40 Transport cost 0.80 1.60 Margin 7.00 14.00 Sale price 50.00 Price paid by the Consumer 50.00 100.00 www.tjprc.org [email protected] 24 E. Dhivagaran*, S. Selvanayaki & D. Murugananthi From the Table 3, it is observed that the transportation cost was incurred by the producer and the retailer only, exposing the fact that the commission agent remains in a place facilitating the marketing activity where the producers and local traders meet. The producer’s share in consumer’s Rupee is (71.40%) Table 4: Marketing cost of intermediaries in Channel III Channel III: Producer Commission Agent Local Trader Retailer Consumer Amount (Rupees Percentage to S. No Particulars per kg) consumer’s Rupee 1 Producer Gross price received 40.00 45.45 0.50 Picking 0.40 Loading and unloading 0.40 Transport 38.70 Net price received 2 Commission Agent 40.00 Purchase price Packaging 0.50 0.57 Marketing cost 0.80 0.91 41.30 Subtotal Margin 4.70 5.34 46.00 Sale price 3 Local trader 46.00 Purchase price Loading and unloading 0.65 0.74 Transport 8.50 9.66 Margin 15.85 18.01 71.00 Sale price 4 Retailer 71.00 Purchase price Marketing cost 1.80 2.05 Margin 15.20 17.27 88.00 Sale price Price paid by the Consumer 88.00 100.00 From Table 4, it is evident that the producers and the local traders were the ones who incur transportation cost revealing that the retailers were provided with the produce by the traders. In this channel the higher price was due to the reason of higher distance value addition, i.e., the produce was moved to Kerala for marketing.The producer’s share in consumer’s Rupee is (43.98%) Impact Factor (JCC): 8.3083 NAAS Rating: 4.13 Price Spread of Guava in Madurai District of Tamil Nadu 25 Table 5: Marketing cost of intermediaries in Channel IV Channel IV: Producer Local Trader Retailer Consumer Percentage to S. Amount (Rupees consumer’s No Particulars per kg) Rupee 1 Producer Gross price received 34.00 59.65 0.50 Picking 33.50 Net price received 2 Local trader 34.00 Purchase price Loading and unloading 0.65 1.14 Transport 1.25 2.19 Margin 9.10 15.96 45.00 Sale price 3 Retailer 45.00 Purchase price Marketing cost 1.80 3.16 Margin 10.20 17.89 57.00 Sale price Price paid by the Consumer 57.00 100.00 From the Table 5, we could observe that the local trader was the one connecting the retailer and producer neglecting the commission agent. The producer’s share in consumer’s Rupee is (58.77%) Table 6: Marketing cost of intermediaries in Channel V Channel V: Producer Commission Agent Local Trader Exporter S. Amount (Rupees Percentage to No Particulars per kg) importer’s Rupee 1 Producer Gross price received 32.00 13.91 0.50 Picking 0.40 Loading and unloading 0.40 Transport 30.70 Net price received 2 Commission Agent 32.00 Purchase price Packaging 0.50 0.22 Marketing cost 0.80 0.35 33.30 Subtotal Margin 3.70 1.61 www.tjprc.org [email protected] 26 E.