connecting farmers to markets fpo update · chhattisgarh - 2 andhra pradesh - 1 tamil nadu - 0...
TRANSCRIPT
Connecting Farmers to Markets 1 28 August 2016
Connecting Farmers to Markets
FPO update – November 2017
Connecting Farmers to Markets 1 07 December 2017
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Snapshot
0 10000 20000 30000 40000 50000 60000 70000
Month
May-16
Jul-16
Sep-16
Nov-16
Jan-17
Mar-17
May-17
Jul-17
Sep-17
Nov-17
03,500
8,000 15,000
16,000 16,000
16,000 18,00018,500
19,50025,000
26,40030,500
34,50039,100
43,32743,327
44,50346,803
47,103
61,440
No. of farmers who traded on NCDEX
9.4
6.67.7
9.48.3
9.4
6.6
9.4 9.0
0.01.02.03.04.05.06.07.08.09.0
10.0
FPO Realisations through Futures (% increase over prevailing spot price)
0
5000
10000
15000
20000
25000
Ap
r-1
6
May-1
6
Ju
n-1
6
Ju
l-16
Au
g-1
6
Se
p-1
6
Oct-
16
Nov-1
6
Dec-1
6
Ja
n-1
7
Feb
-17
Mar-
17
Ap
r-1
7
May-1
7
Ju
n-1
7
Ju
l-17
Au
g-1
7
Se
p-1
7
Oct-
17
Nov-1
7
60 1000
50506068
6728
85588958
10118
10568
10778
1092811498
1190812568
13448
13828
17478
2102821138
21238
Traded Quantity (MT)
55
Farmer Producer Organisations (FPOs) who
traded on the NCDEX platform
61,440
Farmers represented by trading FPOs
14
States covered
14
Commodities traded
118
FPOs who have opened accounts with NCDEX
138
FPOs in the process of
opening trading accounts with NCDEX
Commodities traded on the Exchange platform since April 2016
April-November 2017
Maize
12,990 MT
MTMT
Soybean
7,670 MT
RM Seed
460 MT
Castor
40 MT
Guar Seed
40 MT
Wheat
100 MT
Cocud
40 MT
Barley
70 MT
Soy Meal
20 MT
Kapas
8 MT
Turmeric
40 MT
RM Cake
20 MT
Jeera
15 MT
Pepper
14 MT
Connecting Farmers to Markets 2 07 December 2017
FPO engagement – NCDEX Footprint
Rajasthan - 7
Maharashtra - 66
Bihar - 9
Madhya Pradesh - 15
Telangana - 4
Karnataka - 2
Haryana - 0
Uttar Pradesh - 2
Chhattisgarh - 2
Andhra Pradesh - 1
Tamil Nadu - 0
Gujarat - 8
NCDEX is actively engaged in the training of farmers, handholding the Farmer Producer Organisations
(FPOs) and connecting them with the Exchange platform in several States across the country. We have
successfully on boarded 118 FPOs so far and are growing strong with each passing month.
The number of FPOs in each State (above) represent those FPOs, who have either traded or opened
a trading account with NCDEX. States that do not have any value assigned to them are the ones where
NCDEX is actively engaged in training of farmers and the FPOs, however no accounts have yet been
opened.
Punjab - 1
Kerala -1
Connecting Farmers to Markets 3 07 December 2017
State in focus
Background
Karnataka – Though the concept of Unified Market Platform (UMP)
as proposed by our Finance Minister, Mr. Arun Jaitley, in the Union
Budget of 2015-16 may take some time to evolve, the state of
Karnataka is already leading the pack in this regard, with online
integration of its APMCs. Also popularly known as the ‘Karnataka
model’, the UMP concept is getting power under its wing, as ably
demonstrated by Karnataka. Agricultural landscape in Karnataka is a
combination of areas that are drought prone as well as highly fertile,
well-diversified terrain. Areas such as horticulture, floriculture, food
processing and other allied agricultural activities have contributed
significantly to the growth of the state’s agri sector, in addition to its
famed IT sector. For many rural residents of Karnataka, agriculture is
the major occupation. A total of 123,100 sq.km of land is cultivated,
constituting 25.3% of the total geographical area of the state. Agriculture in Karnataka is heavily dependent on the southwest
monsoons since the extent of arid land in the state is second only to
Rajasthan. The state has three agricultural seasons: Kharif (April to
September), Rabi (October to December) and Summer (January to
March). The main crops grown here are Rice, Ragi, Jowar, Maize, and
Pulses (Tur and Gram), besides Oilseeds and a number of cash crops.
Cashews, Coconut, Arecanut, Cardamom, Chillies, Cotton,
Sugarcane and Tobacco are amongst other crops produced in the
state. In order to fuel growth of innovative ideas in the agritech sector,
Karnataka is the country’s only state, wherein its state agricultural
department has set aside Rs.10 crore fund (to be administered by the
information technology and biotechnology (ITBT) departments), for
fostering agri-innovation in the state.
NCDEX Impact
FPOs of the region understood the concept of hedging and
soon they will start participating on the Exchange platform.
Organisations like ISAP and Horticulture Board have shown
interest to on board their FPOs on the Exchange platform.
FPOs from the districts surrounding delivery centres have
shown interest in participating on the electronic trading
platform.
FPOs are organising exposure visits to understand cleaning,
grading and processing of commodities.
Farmers are willing to come out of the traditional trading
system and have shown interest in using Futures platform to
sell their crops.
FPOs have subscribed to daily Futures prices and these
prices are communicated to all member farmers.
Highlights
NCDEX listed commodities – Sugar, Pepper
and Maize
NCDEX Delivery centres – Belgaum, Hassan,
Shimoga and Davengere
Number of FPOs registered on Exchange
platform: 2
Number of FPOs participated on Exchange
Platform: 0
Number of FPOs in the account opening
process: 4
Number of farmers associated with the trading
FPOs: around 2,000
Financial partners: Samunnati Finance and
NABKISAN
Partnering Member: Karvy Comtrade and RBG
Partner organisations for capacity building in the state: ISAP, Horticulture Department and NABARD.
Karnataka
Connecting Farmers to Markets 4 07 December 2017
Events & Training
Modasa, Gujarat
Training program for Reliance
Foundation promoted Farmer
Producer Organizations (FPOs) in
Gujarat (Modasa) on Futures
trading and its benefits for farmers.
Mumbai, Maharashtra
Training program for Mann Deshi
Foundation officials at Mumbai,
Maharashtra on Futures trading
and its benefits to farmers.
FPO Training
Patna, Bihar
Training program for NABARD
supported POPIs at Patna, Bihar on
Futures trading and its benefits for
farmers.
NABARD and SEBI
Conference organized by
NABARD and SEBI on connecting
farmers to electronic markets and
how to double farmer incomes.
Wayanad, Kerala
Training program for NABARD
supported FPOs at Wayanad,
Kerala on Futures trading and its
benefits for farmers.
NCDEX participation in the National Seminar on "Linking FPOs with Commodity Exchanges - Challenges &
Opportunities”
The seminar focused on evaluating preparedness of the Farmer Producer Organisations (FPOs) in terms of enabling
trading on the Exchange platform, understand the related constraints and policy reforms. The seminar also explored
the role of NCDEX e Markets Ltd. (NeML) in facilitating improved market access to FPOs, and also helped impart
guidance to leverage agri-Futures tool for improved price realisations.
Connecting Farmers to Markets 5 07 December 2017
Kheti Ke Sikander
Turning the tide of Pepper market with quality upgrade
Malabar has always been known for its spices, especially for its superb quality
Pepper for centuries. However, that’s a thing of the past. It has not only lost its
quality uniqueness, but also its quantity superiority. Currently, there are 26 pepper
producing countries in the world. Vietnam leads with volume, whereas the Sri
Lankan pepper enjoys the best quality tag. The immediate casualty of this changed
trade dynamics are the farmers of Kerala. Farmers of Idukki, the only region in
Kerala that produces pepper to match Sri Lankan quality, aren’t fetching good
prices, as inferior quality pepper from abroad has lowered the benchmark prices
in Kochi mandi, that is used as the yardstick for their produce.
Amidst such a situation, a farmers’ group called Devikulam Cooperative Society,
has come forward as a saviour for the local farmers. The society procures produce
from the farm gate and sells them at Kochi mandi, thereby saving the
transportation cost for the farmers. To ensure best possible price for the farmers,
the society keeps a track of the prices in Kochi mandi and sells the produce when
the prices reach at an appropriate level. But the overall market condition has
become a source of pain. “We give prices on the basis of Kochi mandi. But now
the problem is that the mandi is populated with low quality imported pepper and
that has lowered the average price level. Due to this situation, our farmers are not
getting good prices even for their premium quality produce”, said Jijo Thomas, an
official from Devikulam Cooperative Society.
Under such circumstances, the society is continuously looking for new and
innovative ways to fetch better prices for its member farmers. Doing collateral
management through bank financing saves farmers from distress sell. But now,
after the relaunch of pepper contract on agri commodity exchange platform -
NCDEX, officials of Devikulam have found a new ray of hope for direct marketing
of the farmers’ produce. “Currently, we are selling the procured pepper at the
mandi level only, as the stringent quality standards set by the Exchange are difficult
for farmers to meet. However, we’re in the process of constructing a grading and
processing plant soon to address this area. As soon as it gets ready, we will
commence working on the NCDEX platform with admissible quality standards”,
says Mr. Sunny MJ, Secretary, Devikulam Cooperative Society.
In fact, the Devikulam team have already begun taking advantage of the NCDEX
Pepper Futures contract to hedge their stocks from any price fall. Just last month
the society managed to successfully save around Rs. 5 lakh by trading on the
Exchange platform. “We had a stock of around 20 MT and prices began to fall due
to excessive import quantity. There weren’t any buyers around. Then, we used the
NCDEX platform to hedge our quantity in 2 lots and later sold them in Kochi mandi.
This way we were able to reduce our losses to Rs. 5 lakh in lieu of Rs.10 lakh
which we could have incurred had we not used the hedging tool” - says Mr. Sunny
MJ. Industry insiders say farmers have no choice other than to sell their crop to
processors as they don’t have the right resources to upgrade their produce up to
the tradable quality. But with the newly launched pepper contract, FPOs such as
Devikulam Cooperative Society are all set to change the rules of this game. The
FPO has already started training their members in the areas of quality upgrades,
that will provide them with a direct marketing tool to fetch best prices for their
member farmers
Devikulam Cooperative Society
Connecting Farmers to Markets 6 07 December 2017
NCDEX Indices
Dhaanya is an agricultural commodities index computed by NCDEX. It aims to provide a reliable benchmark for the traded Agri-commodities in India. It is based on simple and transparent methodology.
The components of Dhaanya are selected from diverse sub sectors of the Indian agri industry and accounts for nearly 70% of the trading on the NCDEX platform. Commodity selection is based on both endogenous (liquidity) and exogenous (importance in Indian/ Global commodities market) criteria.
The NCDEX Agri Futures index would be constituted by the top ten liquid commodities traded on the NCDEX platform. It is a value weighted index, weights are assigned to each component based on national production and the traded value. Equal importance is given to both the parameters to calculate the final weights of the index components. The index is computed in real-time, using price of the near month traded Futures contracts.
Dhaanya is a rolling index i.e. periodically Futures contracts held in the index are rolled over onto the next near month contracts as current month contracts approach expiration. Dhaanya components and their weights are rebalanced every three months based on the production values and liquidity situation prevailing in the market place.
Currently, Dhaanya comprises of Castor seed, Cottonseed Oil Cake, Dhaniya, Guarseed, Jeera, RMseed, Chana, Soybean, Turmeric and Wheat.
At the beginning of April 2017 Dhaanya index value was around 3,163. Since then the value has decreased by 10.4%, reaching a minimum of 2,834. Bearish trend in all commodities since April 2017 is the cause of fall in Dhaanya.
Spices Index components comprise of spices – an integral part of the Dhaanya Index. It is an equal weighted index; meaning that each constituent of the index carries an equal weightage in the index value calculation.
Currently, the spices index comprises of Dhaniya, Jeera and Turmeric.
2700
2800
2900
3000
3100
3200
3300
3400
Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17
Dhaanya
1400
1500
1600
1700
1800
1900
2000
2100
2200
Spices
Connecting Farmers to Markets 7 07 December 2017
Partner Ecosystem
Members
Financing
Agencies
Promoting
Agencies
MACP
Supporting
Agencies
Consulting
/ Training
Agencies
Grant
Thorton
Connecting Farmers to Markets 8 07 December 2017
NCDEX e Markets Limited (NeML)
The FFresh team of NCDEX e Markets Ltd. (NeML) continues with its efforts in connecting farmers from growing areas
to the consumption markets. Currently, the team is engaged in connecting farmers with the FFresh markets for the
following commodities:
Pomegranate, from the growing areas around Pune and Nasik in Maharashtra.
Kinnow, from the growing areas of Sirganganagar (Rajasthan) and Abohar (Punjab).
Strawberry, from the hills of Mahabaleshwar in Maharashtra.
POMEGRANATE
The NeML team visited the production centres of Phaltan, Girvi, Sangvi, Indapur and Samngamner. The team introduced
FFresh concept and the platform to a gathering of farmers and registered them on the platform. Couple of FPOs and
their representatives, namely Mr. Nilesh Kadam from Gopal Krishna Farmer Producer Company (Phaltan), Sopan Unde
(Phaltan) and Next On Foods Pvt. Ltd (Pune) decided to come on board.
Below mentioned are the details of farmers who sold their produce through FFresh platform:
Member Name
Location No of
Trades
Net Weight Kg. Value Destination Markets
Sopan Unde & Nilesh Kadam
Phaltan 5 10,359 5,35,481/- Siliguri, Muzaffarpur
Next On Foods Pvt Ltd Pune
7 29,988 15,38,087/- Siliguri, Chennai,
Muzffarpur
The NeML team identified the consumption markets of Siliguri and Muzaffarpur for the produce. These are primarily the
markets for small sized fruits, while Chennai demands larger and high quality pomegranate. As the size of the fruit was
average we accordingly suggested them the relevant markets.
KINNOW
For the past couple of years, the Kinnow growers from Rajasthan and Punjab are engaged with NeML for their sales activities. This year NeML deployed one of its dedicated resource at the start of the season at Sriganganagar. This was done to ensure that we reach out to as many growers as possible and help them establish market linkages. The season has begun and we are looking forward to a very prosperous one for the growers. So far, NeML has worked with three growers namely Mr. Rajesh Jhakhar, Mr. Parth Dawra and Mr. Gurprit Singh
Thind. Mr. Gurprit and Mr. Parth have collectively dispatched three vehicles, till date.
Member Name
Location Net Weight
Kg. Value (Rs) Location
Gurprit Singh & Parth Dawra Sriganganagar 40,670 12,60,770/- Bangalore, Siliguri, Chennai
Connecting Farmers to Markets 9 07 December 2017
STRAWBERRY
The Strawberry season has started around 15th November and will last until the end of February. The early variety of
winter strawberry has started flowing in and the first picking was undertaken on 15th November. Team NeML began its
engagement with the farmers since September, with assisting farmers in planning for the season. NeML has opened a
collection centre at village Bhilare, so that the local farmers could deposit their produce in the village itself. The logistics
for the onward dispatches are also managed from this village centre, thereby reducing the multiple transit exchanges.
In the past fortnight, NeML has successfully helped growers with the following trades:
Members Name Location Qty in punnets Trade Value
Mr. Deepak Yadav Mahabaleshwar 1,008 50,400
Mr. Dinesh Bhilare Mahabaleshwar 1,030 51,500
Mr. Santosh More Mahabaleshwar 3,563 1,78,150
Mr. Suresh Pawar Mahabaleshwar 4,719 2,35,950
Mr.Sunil Bhilare Mahabaleshwar 996 49,800
NeML is dispatching the produce to the following consumption markets:
Location No. of Punnett Value
Chennai 3,808 2,36,676
Bangalore 3,920 2,20,080
Bhubaneswar 280 15,400
Mumbai 2,748 1,36,536
Kolkata 112 6,160
Pune 224 12,320
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