Marketing of Arecanut in Shimoga

A STUDY OF PRODUCTION AND MARKETING OF ARECANUT IN SHIMOGA-MAMCOS
TABLE OF CONTENTS Chapter No 1. 2. 3. 4. 5. 6. 7. Title Introduction Historical background of Areca nut Agricultural Marketing in India Significance in Marketing of Arecanut Profile of the Society (MAMCOS) Analysis of Survey Conclusions and Suggestions Annexure Questionnaire Bibliography Page No
SRS First Grade College, Chitradurga
LIST OF TABLES Table No 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Title Details of Areca nut received from members at various places Areca nut collected from agencies Share capital of MAMCOS, Shimoga Distribution of growers according to their annual income Areca nut yield per acre in quintals Number of persons cultivating types of Areca Mode of transport used Selling centers opted by respondent Problems faced by growers Payment on sales made to the growers immediately Page no
LIST OF FIGURES Figures no 1. 2. 3. 4. 5. 6. 7. Title Distribution of growers according to their annual income Areca nut yield per acre in quintals No. of persons cultivating types of Areca Mode of transport used Selling centers opted by respondent Problems faced by growers Payment on sales made to the growers immediately Page no
CHAPTER - I
INTRODUCTION TO PROJECT
Introduction Objectives of the study Methodology Scope of the study Limitation of study Chapter Scheme
Introduction Areca nut is one of the important commercial crops in India. It plays a proximal role in the Religions, Social and cultural life of our people. The betel nut is the seed of areca or betel palm and the leaf from the betel pepper or pan plant. Areca nut is used for chewing. It is chewing with betel leaf and lime or chanan and little cardamom added with it. The people chew it with betel leaf and lime after the food for digestion. Areca nut is grown in the hot and humid regions of India, Bangladesh, Sri Lanka and Malaysia and to the smaller extent in the East inclines and Burma. It is grown with coconut, Jack, Mango, banana and spice. Areca nut is used in India by all section of the people. It is useful in one way or other. Areca nut is one of the main ingredients of Thambula, chewing of which, it is getting to be universal habit forming luxury to the rich and poor people alike. It is used in Ayurvedic and Veterinary medicine because of its several alkalizes. Chewing results in a brick red solution, which will temporary dye the mouth and lips, become orange brown. The aromatic, which is used in areca nut, is help full in avoiding the bad smell.
Objects of the study To know the marketing of arecanut in India To study the methods of marketing To know the role played by the MAMCOS To know why the formers prefer a particular co-operative society. To know the reasons for selecting the co- operative society. To know the problems of the growers. To find out the solutions to the problems faced by the farmers. To identify the main reason for the fluctuation of price in the market. To know whether the government has taken proper solution to that. To suggest some ways and means for production and marketing of produce. Methodology This project study is mainly based on primary as well as secondary data. The primary data is collected by administering a structured questionnaire from the selected farmers. Personal interview is also conducted wherever necessary. The Assistant Manager of MAMCOS is also interviewed after obtaining opinions of areca nut growers. The secondary data is also collected to support our study from various sources like Areca nut markets, Annual reports of MAMCOS, Adike pathrike, Magazines, Periodicals, News papers etc.
The collected data is classified, tabulated and analyzed to draw meaningful conclusions and to suggest some useful measures to improve the production and marketing of areca nut. Scope of the Study Shimoga market for areca nut is an important market in India, Therefore this particular market area is taken for survey by selecting 60 areca nut growers to elicit problems faced by them in the production, processing and marketing of areca nut. The study concentrates on the marketing of areca nut of the concern. Here, attempt has been made to cover all aspects of marketing of areca nuts i.e. Buying, Selling, Assembling, Grading, Marking etc. The marketing has even greater importance and significance as a whole than for any of the individual beneficiaries of the marketing process and can be expressed as follows: The nations income is really composed not of money but of the goods and services which money can buy. A reduction in the cost of marketing is a direct benefit to society or company. Marketing process brings new varieties quality and beneficial goods to consumers. Approximately one-third of all persons gainfully employed in the country are engaged in the field of marketing.
Scientific marketing has a stabilizing effect on the price level. In a country like India that is striving to break the age-old bondage of man to misery. Marketing brings to the very doors of the peasants useful implements. Scientific marketing also remedies the imbalance in the supply by making available the surpluses to deficit areas. Marketing adds value of goods by changing their ownership and by changing their time and place of consumption. It adds value to services e.g., business, medical entertainment and educational services by performing the services involved. The object of the marketing as of all productive activities is to satisfy human wants. We do not consume or take bread to give the farmer a market for his product , but what he grows is the demand of the people and if that is not satisfied in the locality itself , it is imported from other centers of production.
Limitation Being the areca nut marketing in a national level the survey has been restricted to Shimoga. The sample size selected is due to pacing of time. The figures in survey finding are given on the basis of 50 farmers. The study does not show the position of entire market of areca nut in Shimoga but represents only a certain places of Shimoga. Chapter Scheme Chapter-1: Introduction - Deals with Research Design Chapter-2: History Deals with historical background of Arecanut Chapter-3: Agriculture Marketing in India Deals with Agriculture Marketing in India. Chapter-4: Significance in Marketing of Arecanut Deals with Marketing of Areca nut Chapter5: Profile of the Society (MAMCOS) Deals with the profile of MAMCOS, Shimoga Branch Chapter 6: Analysis of Survey Deals with the analysis of survey conducted Chapter 7: Conclusions and Suggestions Deals with the Summary of survey conducted followed by conclusion and suggestions.
CHAPTER-II HISTORICAL BACKGROUND OF ARECANUT Introduction History Scientific classifications Role of Areca nut in India
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Historical Background of Arecanut Introduction Areca nut is popular as a masticator used either with betel leaves or as plain or as scented supari. Areca nut has uses in Ayurvedic and Veterinary medicines, because of its several alkaloids but its utilization in this manner is negligible on the whole. The habit of chewing areca nut is typical of the Indian sub-continent and its neighborhood. Its demand in other parts of the world is chiefly from the section of the population who migrated originally form this sub-continent. The production of areca nut is also largely confined to this sub-continent. Betel nut the seed of the betel palm (Areca catechu) which is chewed as a stimulant throughout Southern Asia. The betel nut is about 2 inches (5cm) long and is mottled brown and grey in color. The ripened seeds are gathered between August and November, boiled in water, cut into slices and dried in the sun, giving a dark-brown or reddish in color. Each dried nut is then wrapped together with a piece of shell lime in a leaf of the betel pepper and chewed. Betel nuts contain the alkaloid arecoline a mild stimulant that produces a feeling of well being. They are not habit-forming but habitual chewing of betel nuts eventually blackens the teeth and may cause them to decay. In some parts of the orient, betel nuts are used a drug to destroy intestinal worms. Elsewhere they are used as preliminary in veterinary medicine to de-worm horses, dogs and other animals. It is sometime prepared raw by drying smoking or salting. The pieces are rolled in a leaf of betel vine smeared with quick-lime. Betel color saliva red and blackens the teeth that are neglected.
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Scientific classification The betel nut palm belongs to the palm family palmae. It is genius Areca spices a Catechu. The betel vine belongs to the pepper family piper areca and is piper betel. Following table gives the area under and production of areca nut in the principal growing countries:Table Area Country 1) India 2) Bangladesh 3) Sri Lanka 4) Malaysia 174 79 20 04 Area = 1000 hectares. Production 150 57 57 N.A Prodns = 1000 tonnes.
India leads in production but even then, it was never sufficient to meet the internal demand until recently. It had to depend upon imports to fulfill the gap. The data pertaining to this crop has been collected by the directorate of Economics and Statistics. Organized research work on this crop is being conducted from the last 30 years or so. The Government of India made a financial grant of 5 lakhs to the I.C.A.R (Indian Central Areca nut Research) for the first time in 1945 for financing measures to Mysore and develops the production and marketing of areca nut. The Indian Central Arecanut Committee (I.C.A.C) was constituted in 1949
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on the recommendations of an Adhoc committee appointed by ICAR in 1947. There is at present an All India Co-ordinate Project on Areca nut Research in which all the under mentioned stations are also involved. A. Main stations: Central Plantation Crops Research Institute Kaasaragod (Kerala). B. Regional stations of CPCRI:1. Central Areca nut Research Station, Vital (Karnataka). 2. Central Areca nut Research Station, Hirehalli (Karnataka) C. Sub-Stations of CPCRI. 1. Areca nut Research Station, Palode (Kerala) 2. 3. 4. 5. 6. ------do------- Poochi (Kerala). ------do------- Sreevardhan (Maharashtra). ------do------ Mohitanagar (west Bengal). ------do------ Kahikuchi (Assam). ------do------ Sipi ghat. (Port Blair Andaman Nicobar) The departmental program which was formerly being carried out by the I.C.A.R is now attended to by the Directorate of Areca nut and Spices Development with Headquarters at Kozhikode. Work on technological aspects of areca nut has been conducted from time to time in different Universities and Institutes through specific schemes sanctioned in the part by the I.C.A.C. some of them are mentioned below: (1) Chemistry of Areca nut husk and its destructive distillation utilization of husk in the preparation of wrapping paper board insulating wool cellulose plastics moulding powder and also by-products of
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destructive distillation of the husk Forest Research Institute, Dehradun and the University of Gauhati (Assam) and Travancore (Kerala). (2) Utilization of areca palm and nuts in leather tanning and in the preparation of writing Ink-Central Leather Research Institute, Madras and Presidency College, Madras. (3) Preservation of areca fruits and husk in fresh condition- Travancore University and Central Food Technological Research Institute Mysore. (4) Chemical constituents of areca palm and nuts isolation of alkaloids including their individual components and testing their pharmalogical action and therapeutic uses University of Calcutta, Aligarh Andhra Pradesh. (5) Utilization of areca nut in the preparation of dentifrice Calcutta Chemicals Ltd., Calcutta. (6) Drying of Areca nuts- Central Food Technological Research Institute, Mysore. Although the technological work has been done in the past in a scattered manner on a ad-hoc basis and many remain unavoidable to some extent in future too, it is expected that many problems on the side of utilization will also be attended in future. As a result of research work, a few exotic varieties of areca nut have been identified for better performance over the local cones. Mangala an introduction from China
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has already been released for cultivation. Studies have been made on methods of raising plants, selection of seed nuts and seedlings and NPK requirements, water management, mixed cropping and pests and disease. Majority of the growers in Karnataka have been in a position to derive benefit from such studies but the same cannot be said about planters in other parts and these aspects has been discussed in the next paragraph. Many Nurseries exist for raising seedlings and supplying the same to growers but plants at large are hetrogenous in nature and contain low yielding types. Diseases like Anabe (foot rot) kole-roga, Yellow leaf and Band Diseases and Pest-like root Grab Spindle Lug and Fluorescents Caterpillar continue to take heavy toll of the crop. Role of Arecanut in India Areca nut has inspired many poets and musicians. There is hardly any Kavya without any reference to Areca nut. The life span of the palm is considered to be the same as that of man and it is associated with the life and culture of our people. In India, the areca palm is cultivated all along the Western coast from Maharashtra to Kerala. On the plateau of Karnataka in the Gangetic delta of West Bengal, Assam and Meghalaya. The fruits are largely used for chewing with or without betel leaf. In south India, the conditions of cultivation are quite different from those prevalent in eastern India. Unlike the Eastern Zone, areca gardens of the south have to be constantly looked after and a lot of labour and money is spent on them throughout their life time. Areca nut is often the principal and several instances the only cash crop of the locality in which it is produced.
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It finds a place of honour at all occasions, births, weddings, rejoicings and deaths. It is an essential item of custom and is symbolic of Indian life. CHAPTER III AGRICULTURE MARKETING IN INDIA Introduction Problems of Agricultural Marketing in India Measures taken for improving Agricultural Marketing in India
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Agriculture Marketing in India In the past, agriculture was carried on by the farmers in India on a subsistence level, i.e., for-their consumption. As such the question of agriculture marketing did not receive much importance. But after the adoption of new agricultural strategy, agriculture is being carried on a commercial basis, i.e., mostly of sale in the market. Again, a large number of cash or commercial crops are grown only for sale in market. Consequently, there is a need for an efficient agricultural marketing system so as to enable the farmers to have wide markets for their produce. The need for and the importance of efficient agriculture marketing arises from the following factors:The ultimate objective of agricultural production cannot be achieved unless the agricultural products are sold efficiently to the advantages of farmers, an efficient agricultural marketing is necessary. Efficient agricultural marketing not only ensures the sale of agricultural produce to the advantage of farmers, but also assure adequate and timely supplies of food stuffs to the consumers and raw materials to the manufacturers. Problems of Agriculture Marketing in India It is true that an efficient agricultural marketing system is essential for India. But, till recently, agricultural marketing in India had been defective. It has been suffering a number of problems. The main problems of agricultural marketing in India are:
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Lack of organization of the farmers. Poor paying power of farmers. Long chain of middlemen. Multiplicity of market charges. Mal practices in the market. Multiplicity in the weights and measures. Absence of grading. Adulteration of agricultural produce. Inadequacy of storage facility. Absence of adequate transport facility. Lack of market information. Inadequate provision of credit.
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Measures taken for Improving Agricultural Marketing in India An efficient agricultural marketing system is essential for the successful development of agriculture. But the agricultural marketing system in India is defective in several respects. So remedial measures have to be adopted for improving the agricultural marketing in the country had been made by several committees, and in accordance with these recommendations, a number of measures have been undertaken by the central and state Governments for improving agricultural marketing in the country. The various measures of agricultural marketing in India are: 1. Establishment of regulated markets. 2. Development of co-operative marketing. 3. Standardization of weights and measures. 4. Grading of agricultural produce. 5. Development of warehousing facilities for agricultural produce. 6. Extension of transport facilities to rural areas. 7. Provision of adequate liberal finance for raising and marketing of agricultural produce. 8. Provision for market information.
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CHAPTER IV SIGNIFICANCE IN MARKETING OF ARECA NUT Introduction Markets Chain of Intermediaries Assembling or buying of product Standardization and Grading Grading of product AGMARK Grade standards for areca Types of Arecanuts Pricing of Arecanut Commodity based organization Co-operative marketing federation for areca nut Marketing for areca Methods of marketing Payment Storing and warehousing Co-operative Marketing of Arecanut Regulated Markets
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Significance in Marketing of Arecanut Introduction Marketing of agriculture produce is in crux of rural economy in our country. It has of late, assumed added importance as the cultivators have to raise commercial crop for sale in distant markets and the village self-sufficiency of the gone days has now almost disappeared. There will be no incentive for the cultivators to increase their production unless they are assumed of an economic price for their produce. The cultivators who are generally isolated have no contract with the distant distributing and consuming centers. Their holdings being small, the output is little and consequently they do not earn much interest in the sale of produce. Marketing of areca nut is more expensive because of the size of the productive unit, the dispersion of producers, the great disparity in quality and quantity of products etc., A serious draw back in the existing marketing system is the inadequate arrangements with regard to marketing facilities such as collection, storage and transport of the produce and lack of knowledge of the price structure at every stage. As areca nut is produced by a large number of small growers whose financial resource is meager, they are often faced with the situation where the growers have no option but to part with their produce at throw-away prices. The cultivators generally have no contact with the distant distributing and consuming centers and as a result, a substantial portion of price paid by the consumers goes to the middle man.
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Market A market is a centre about which the focus leading to exchange or title to a particular product operate and towards which the actual goods tend to travel. Market can be divided into two types on the basis of operation. Primary market is generally a producers market. Shimoga is a primary market, for areca producers often sell their surplus products in such market through their known market middlemen called commission agents, Mandis, Mamcos and Apscocs etc. The produce they assemble passes to the secondary market. Secondary markets are the wholesale markets and mostly located in areas of consumption. The produce is handled in large quantities and specialized operators such as way man brokers and commission agents become necessary for the performance of different services. They are having ample facilities for financing, storage and transportation. Secondary markets are in fact the best forms of organized market for the settlement of agricultural products in India. Terminal markets are produce exchange with trade association conducting exporting and internal distribution of commodities. Marketing is the performance of all business activities in flow of goods and services from the point of initial agricultural production until they are in the hands of ultimate consumer. A farmer should dispose his produce so as to get the maximum return of price, at the same time we should look into the interest of the buyer who should get full satisfaction from the price he pays for areca.
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Chain of intermediaries The produce has to pass through the local user and commission agents at the assembling centers. The exporters and the importers are at the top and the whole sellers and retailers at the distributing and consuming centers. A substantial portion of the price paid by the consumer represents the cost of handling and the margin of profit earned by the several intermediaries. The middleman services are therefore essential to link the producer with the consumers. Someone has to undertake the curing, collecting, grading, transporting, selling and delivering to the ultimate consumer. But considerable economy can be affected through a combination of producers and co-ordination of numerous unit of production of marketing. The commission agents purchase the areca nut through agencies and growers, brokers; they charge commission at some percentage. Brokers operate to bring buyer and seller together. Primarily, brokers sell information of product available for sale or purchase. In recent amendment, all commission agencies are traders who are not bidding in auction unit but they appoint agents for bidding in the auction sales. Assembling or buying of product Assembling refer to those business activities which are concerned with concentrating goods under a single management or control. The object of assembling is to make available the goods wanted by producer or consumer at their hands. The assembling implies ownership not merely the physical transfer of goods. In modern times of varied production and varied demands, assembling as a function of marketing
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has assumed great importance. In the case of areca nut which is produced in scattered small fields in certain seasons, assembling is all the more importance. Assembling should not be confused with transportation or storage. These functions of physical supply along with other functions are performed to assembling their functions are one and same. Assembling thus implies bringing the goods at convenient points in the volume, quality and quantity required. It results from buying efforts. The dealer who knows where he can purchase at all times a sufficient quantity of the product he has for sale performing the function of assembly just as is the merchant who transport a supply merchandise and holds it in his warehouse until called for by his customer. The wholesalers of a big Mandi in their turn assembly the produce and break up these lots into smaller ones for the retail traders and the retailers sell them to individual consumers. Standardization and Grading An efficient system of marketing is of utmost importance to a country under all conditions and at each stage of its development. In the present system of commercial production of agricultural crops, there is no room for complacency about the bewildering confusion prevailing in the field of marketing. The marketing system in our country is still antiquated and out of date. The situation is more embarrassing and complicated for the honest dealer or producer, who on the one hand is required allay the suspicion of the buyer and on the other hand, to face the challenge of unscrupulous rivals out for cut throat competition. It is here that the grading of products on basis of well defined standards in
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regard to general appearance, size color and intrinsic quality, helps both the producer and the consumer. Standardization and grading thus proved a common language for the buyer or the seller. The agricultural commodities, as they are raised under varying environmental conditions and cultural practices show consider variation in quality. Unless the quality differences are reflected in the prices, the incentive for the production of the quality produce suffers to the detriment of industrial needs and consumer preferences. If the consumers are not assured of their requirement in a pure form and at a cost within their capacity to pay, there is bound to be general discontentment in public. It is therefore necessary to gear up the various marketing services among which standardization and grading play a vital role. Standardization is the legislation of the grades or is supported by legal sanction and this gives permanence to grade over a long period of time. Standardization indicates the establishment of a certain standard, based upon intrinsic physical properties or qualities of commodity with a view to further sub dividing it into several grades or classes. When we call a commodity, a standard good, we certainly mean that it is of a certain quality. This quality dependent upon chemical contents, flavor, size, color, appearance, length of fiber, and amount of moisture etc, Standardization thus implies a prototype, a model, a pattern or example. Standards generally serve as the basis for future use and to be effective they be relatively permanent and must be used by a considerable proportion of sellers and buyers. Grading of products
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Grading starts where standardization ends. Established standards are commonly called grades. When standardized goods are further subdivided into well defined classes they are known to have been graded. Grading is simply a means of dividing products of varying quality, size etc., into lots of conforming of certain standards. Grading is a process of dividing a quantity of the same kind of goods into uniform groups according to certain standards of size, shape, color, degree of cleanliness, acidity or other significant characteristics. Various chemical and mechanical devices may be used in assorting products or determining the grade of products. In India the areca nut products are raised under different environmental conditions and varying agronomical practices. These products show considerable variation in regard to quality. For healthy trade practices, the quality differences should be appropriately reflected in prices commensurate with the quality of the quality of his produce; he will not have any incentive to go production of better quality. In the absence of well defined quality standards and a regular system of quality marketing products, grading in areca nut commodities even in the secondary and terminal markets has to be based on inspection of products. This ultimately adds to the marketing cost and subjects the producers to systematic exploitation in the trade. The need for introducing well defined grade standards was therefore felt firstly in the field of agricultural commodities in order to ensure the producer a return commensurate with the quality of his produce and buyer his moneys worth.
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AGMARK Grade standards for areca nut Areca nut is one of the commodities included in the schedule of Agricultural Produce Grading and Marketing Act 1937. The Agricultural produce Grading and Marketing Act is permissive and the grading under the same to be known as AGMARK grading. The act authorizes the Agricultural Marketing Adviser, Government of India, to issue certificates of authorized to persons or corporate bodies who are prepared to grade and pack the produce on the prescribed lines. The certificates are issued on individual larger packers. The inspecting staff of the Central Agricultural Marketing Department inspects the grading station in charge of the authorized packers and collect samples of the graded produce from the market. Although AGMARK grade standards have already been prescribed under the provisions of the act for sun-dried whole areca nuts (chali supari), grading under AGMARK is yet to gain momentum and become popular among both growers and traders. The traders and all societies dealing in this commodity have not yet adopted the same for the purpose of internal trade in spite of the many advantages that accrue from grading. While the grade specifications for the sun-dried whole areca nut finalized under this scheme have already been accepted, prescribing AGMARK specifications for boiled areca nuts are under consideration of the Agricultural Marketing Adviser. Grading at Producers level For helping the formers to sell their produce at price commensurate with the quality of the produce sold by them in the mandis, grading at the producers level has been introduced. Under this
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AGMARK scheme, grading services have been provided at regulated at markets, co-operative societies and in certain warehouses as well. Grading at farmers level helps to create mutual confidence between the buyer and the seller. It provides a common language for them since almost all mandis dealing in areca nuts are functioning as commission agents and the produce of the individual areca nut growers is sold in separate lots, they are most appropriate agencies to undertake grading and pooling of the produce and various media is needed to make it.
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Main trade types of areca nuts Areca nuts produced in India can be broadly classified under the following heads: PUDI CHALI ERASEL IYLON NAYAMPAK CHUR OTTARETTU (Tender cut into small bits, length wise and breath, wise boiled and dried) (Ripe areca sun-dried) (Tender-Tinley sliced, boiled, colored and dried) (Tender-sliced and dried) (Tender-cut into pieces and dried) (Tender-cut into small bits length, boiled and dried) (Tender-cut into 4slices, boiled and dried)
UNDE (BETTE) (Tender whole boiled and dried)
Varieties of areca nuts and centers of production and consumption Trade types Ripe Arecanut Ripe Dried Arecanut Main centers of production Kerala, Karnataka, Assam and West Bengal Kerala, Karnataka, Assam and West Bengal, Tamil Nadu and Maharashtra Kerala, Karnataka and Maharashtra Main centers of consumption Kerala and Assam Gujarat, Andhra Pradesh, Madhya Pradesh, Uttar Pradesh, Rajasthan, Delhi, Assam and West Bengal. Tamil Nadu, Andhra Pradesh and Karnataka.
Processed Green Nuts
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Pricing of Areca nut Price is the value of product expressed in terms of money. It is the amount paid by a buyer to seller for unit of product or service. A product may adopt various price policies for the product being produced by him. The price of areca nut varies widely from market to market and even in the same market, there is variation in prices of areca nut markets mainly due to variation in quality of produce. The prices are liable to vary on account of difference in size, color, inner characteristics etc. In addition to the above factors, the varying units of price quotations from place to place. Like other agricultural products the prices of areca nuts are subject to well defined seasonal changes. In the absence of any welldefined standards of quality, it is not possible to get comparable prices over a long period, even in the same market and these may differ even from merchant to merchant. Prices of nuts may be studied considering prices at three levels. 1. The farm level price 2. Whole sale market price 3. Retail market price The farm level price can be interpreted as the price that a farmer is receiving for his produce at the village and mandi levels. Wholesale market price is the price with in find on commodities that is sold in bulk at the market area. A whole-seller is supposed to supply in big lot to the retailers. Retail market price is the price which is rolling in the distribution centers for the consumers.
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Reasons for price hike of Areca nut From the last 4 to 5 years areca nut market has grown rapidly. This is because of the sudden raise in the prices of areca nut. The reason for this hike is increase of popularity about Gutka, which is a tasteful mixture of areca nut pieces, tobacco powder and required especially in youths which is the main reason for price hike of areca nut. If Government bans Gutka or its popularity decreases then areca nut price may fall down. So, growers today itself find other usages of areca nut increasing its popularity and improving the productivity of other by-products. Marketing of Areca nut in Shimoga Shimoga is a primary market for areca. This is the chief market for produce of Thirthahalli, Sagara, Hosanagara, Bhadravathi, Shimoga area. In this area usually whole nuts are marketed and not much of the sliced nuts. This area has been brought under rules and regulations during 1959-60. Reforms in the market practices have been introduced and it is working properly. Shimoga is one of the important centres for areca, banana, betel leaves and pepper. Shimoga is sub-divisional head quarter. Market Area All the business related to areca nut is made in the R.M.C yard located at B.H road, centre of the Shimoga. The yard is established in 1965 and has 50 acres of area. Suitable securities are enforced for the entire area. There are number of nationalized banks and a district cooperative bank near by the market yard.
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The nuts are sorted and graded into different varieties called Aapi, Rashi, Idi, Bette, Chikni, Kempugotu and Chooru. No transportation facility is provided by the concerned authorities to come here. The major advantage is that all the business relating to areca nut is concentrated on one place. Grading by Merchants Classification of nuts into several grades is invariably practiced by merchant in all the assembling markets. This is done generally when the produce is sold by the seller to a merchant. The grading of whole or sliced boiled nuts is generally done by hand picking by female who are generally skilled in the job. For separating the small pieces, circular sieves made of cane with octagonal gates are often used. Specification of grading is generally different from merchant to merchant even in the small markets. Assembling of the nuts The long chain of intermediaries and ignorance of the grower is the main cause for this state of affairs. The producers sells immature, un- husked nuts, sun dried ripe nuts with or without shell and also boiled nuts. The further processing i.e., cutting and boiling need expert handling and it is undertaken by the curer. Wholesale merchants and commission agents generally do not act as assembling agents. The role of co-operative society is insignificance in the market. These societies act as important assembling agent in the respective areas of the operation. Mode of Transport
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The areca nut which is ready for market is brought on bull-carts, Auto carrier, Lorries and trucks to the market for sale. Method of sale The unit of quotation is for one quintal. The prices of areca nut are being settled by Tender System of sales. At Shimoga, sellers commission agent also bid along with other buyers and as such it is not in his interest to get the highest prices for his clients. The sales are being conducted by the respective commission agent in Mandies in Apscos, Mamcos, in presence of the employees of this market committee. As soon as the sale is completed, agreement slips is prepared in triplicate by the market committee staff on the spot and after obtaining the signature of the commission agents and traders are taken of the sales. One copy of the sale is being issued to commission agent and another copy to the traders and third copy is being retained in the sale-note book itself for office record. Method of Weighment As soon as commodity arrived to the commission agents Mandis, the first weighment is being done by the licensed weigh men by the market committee. As soon as weighment is completed a receipt called A Bill is being issued to the producer and a copy of the same will be sent to this Market Committee. The commission agents are permitted to store the bags of the seller in their respective go downs. After the sale, the second weighment receipts called B Bill are issued to the producer. Resale of the crops
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In the distribution of areca nuts the same agencies as in the case of the agricultural produce such as paddy, wheat is employed. These are commission agent wholesale merchants and Retailers. Resale is carried trough commission agents in important distributing centers such as Bombay, Allahabad, Calcutta, Madras, Hubli, Agra, Luck now, Bangalore, Gulbarga etc. Terms are being settled by private negotiations. Wholesale merchants in small market place order with their agents in distributing centers. The cost of distribution besides market charges for services rendered in assembling and distributing markets, include charges for transport and expenses incidental there to. Marketing Channels 1. In the market there are commission agents who store the areca nut of the producers. These agents sell the nuts of the cultivator whenever they want to sell. The areca nut is sold by closed tender system. 2. There are some more merchants, they will be acting as intermediaries such as village merchants, local merchants in the town etc,. There are some merchants in the consuming centers. They are some brokers who work on behalf of the big merchants. 3. There are some Co-operative sectors also who deal in areca, but mostly they are like commission agents in selling the goods. Suggestions for Improvement Improving the statistics of acreage and production Although due to mixed cultivation it may be difficult to have exact statistics of area, arrangement need to be made for recording the
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areca nut acreage with greater accuracy, than at present and for estimating the production annually. A periodical check of areca nut acreage together with a system of recording yield by selected growers in different areas should possibly be adopted to have fairly accurate year to year estimates of production. Improving the Quality of cured Areca nut Defective methods of boiling, coloring and drying affect badly the quality of areca nut, lack of proper knowledge is responsible for this. It can be improved by educating the growers in the best methods of curing, providing credit facilities and by introducing improved ovens for drying areca nuts during the rainy season. Regulating Imports India imports a considerable quantity of areca nuts from abroad to meet its requirements. The prices of imported nuts generally have a depressing effect on the prices of areca nuts produced in the country and indirectly discourage production. Hence, imports should be regulated. Regulating Markets There exists no regulated market for areca nuts to reduce the burden of market charges on the growers. Areca nut market should be regulated. Marketing Areca nuts on Co-operative Basis The Marketable surplus which a grower has to offer for sale is very small because of holding and low yield. It is therefore uneconomic for appear to be a great scope for organizing curing and marketing of societies of producers on Co-operative basis. Marketing Intelligence
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Very little information is available about the arrivals, sticks movements and prices of areca nuts in different markets. The data available about prices are incomplete and not very reliable. The necessary arrangement for the collection and dissemination of the desired information is urgently needed. Improved Grading The grading is almost confined to merchants in the assembling markets, the grower does not derive any benefit from grading there appears to be an urgent need for the fixation and introduction of standard grades. The grading work could be taken by producers, co-operative societies or by Government proposed institution. Commodity Based Organization Co-operative marketing societies areca nut have been organized in Karnataka State on commodity basis having a wide range of operations. The notable example of societies organized on commodity basis having a wide area of operation is as follows. The Malnad Areca Marketing Co-operative Society Ltd. Shimoga. The Sirsi Tatagar's Co-operative Society ltd., Sirsi. The South Canara Agricultural Co-operative Society, ltd. Managalore. The Central Areca nut Marketing Co-operative Society ltd. Mangalore. The Areca processing and sale Co-operative society ltd. Sagar.
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Though these societies are mainly intending to deal in areca nuts, they are also permitted by their bylaws to handle other subsidiary plantation produces such as cardamom, Cashew, Soap nut etc. on small scale. Co-operative Marketing federation for Areca nut Co-operative marketing federation of all the societies dealing in arecanut has been formed in Karnataka State. The main object of this is to promote co-operative marketing on a state level and to open state depots in all the important distributing and consuming centers outside the state. It should be the ultimate object of farming. Marketing for Areca Important trade types dealt with by the MAMCOS Shimoga. Deshavara, Hasa, Petan, Methods of Marketing Process of dealings by Members The Malnad areca marketing co-operative society is working as an intermediate between areca and traders. Members send arecanut in gunny bags to the society. Each and every grower produce is serially numbered along with initiates for convenience sake. After weighing concerned authority of the firm issues the bill, i e., called 'A' bill, which contains quantity of areca nut with number given to gunny bags and name of the members. Rajalu, Nuli, Vantibetta
37
The member could avail the facility of produce loan against the pledge of the produce. The advancing amount is restricted to 60% of the market value of that variety of areca nut. Method of disposing of the Produce According to the member instruction the society will arrange the produce for sale. The bags of areca nut, which are serially numbered, will be exhibited in the society yard. Interested parties quote their prices and give their quotation to the society. Which is a close tender and the tender which will be opened by the concerned authority of the regulated marketing committee. If the members is satisfied with the quoted price they instruct the society to see the produce. In case if he feels that the rates are not satisfactory he will reject the offer. However, if the member agrees to part with quoted price then the concerned authority issues a bill called the 'B' bill, which contains quantity of areca nut, rate per quintal of arecanut and the total amount. The amount is credited to his account after necessary adjustments. A sales transactions is of two days in week that too limited to certain hours. The prices which are quoted for the areca nut being a close tender is finally studies by the regulate marketing yard. Whoever has quoted the highest price will get the areca nut, after the payment of the quoted amount. Payment Payment of the amount by traders The price which are quoted for the arecanut by the traders being a close tender is studied by the regulated marketing yard. The traders who has quoted the highest price will get areca nut. The trader can take areca
38
nut. The trader can take arecanut only after the payment of the quoted amount. The payment can be made in cash or cheque. Discount on the quoted amount will not be allowed. Payment to growers If the member agree to part with the quoted prices. Then the concerned authority issues a bill called 'B' bill. The amount is credited to his account after necessary adjustment. Storing and Warehousing The growers send their areca nuts to the society in gunny bags. Here after weighing, the concerned authority of the society issues a bill, which contains quantity of areca nut with number given to gunny bags and name the member. After grading the gunny bags are stored in the spacious warehouse yard, until it is finally disposed off. There is a separate register maintained in the warehouse containing the number of bags and other particulars. This can be cross checked by tallying with the 'A' bill and the mentioned above.
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CO-OPERATIVE MARKETING OF ARECA NUT Introduction Objectives Characteristics
40
Introduction One of the major reforms or measures suggested for the improvement of agricultural marketing in India is the establishment of regulated markets. Regulated markets, no doubt, have been useful in removing several defects of agricultural marketing. But they alone cannot solve all the problems faced by the farmers. There are certain problems which are outside the purview and reach of regulated markets. Such problems have to be solved through the development of cooperative marketing. Agricultural products have certain special characteristics. 1) They are produced on a small-scale. 2) Their production is scattered. 3) Their production is specialized. 4) Their production is seasonal. 5) Agricultural products vary in quality. 6) They are perishable. 7) There is a relative inelasticity of demand for agricultural goods. All these characteristics of agricultural products make the marketing of agricultural goods difficult for individual formers. So, the farmers have felt the need for joining hands and forming agricultural cooperative marketing societies for the efficient marketing of their produces. Agricultural marketing in India is subject to several defects. Such as the existence of too many middlemen taking away the lions share of the price of the agricultural produce paid by the final consumers, malpractices practiced by the middlemen, excessive market charges,
41
absence of standardization and grading, lack of transport and storage facilities, absence of market information, etc., Again, the staying or holding power of an average Indian farmer is weak. He is forced to sell his produce immediately after the harvest to get the funds needed by him. All these problems have resulted in high cost of marketing and reduced the share of the farmers in the price paid for the agricultural produce by the ultimate consumers. This has necessitated the development of the agricultural co-operative marketing societies. Agricultural co-operative marketing societies can be a part of the integrated rural credit system. They are an essential prerequisite for the efficient running of agricultural co-operative credit societies. An agricultural co-operative marketing society is a co-operative association formed by the farmers for the purpose of performing one or more function. Such as processing standardization and grading, storage, assembling, packaging and selling connected with the marketing of agricultural produce and improving their efforts. In short, it is a cooperative association of farmers formed for the purpose of effective and efficient marketing of their produce.
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Objectives of Co-operative Marketing Society 1. To maximize the income of its members or farmers. 2. Obtaining better prices for the produce of members sold through it. 3. Lowering the cost of marketing. 4. Development of orderly marketing. 5. Adoption of better selling methods 6. Improvement of the quality of the produce through standardization and grading. 7. Elimination of trade abuses. 8. Improved bargaining position as its members are sellers. 9. Development of marketing facilities, such as storage, processing, transport, packing, finance etc.
Characteristics of agricultural co-operative marketing society An agricultural co-operative marketing society has certain characteristics of its own. They are: Association of farmers Voluntary association Open membership Financial resources Sale at market price Equal voting rights Democratic management
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Service motive Limited dividend Co-operative education REGULATED MARKETS Introduction Objectives of Regulated Market Defects of Regulated Markets Measures for the Improvement of Regulated Markets
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Introduction A regulated market is a wholesale or central market where dealings in agricultural produces are regulated or controlled by the State Government through a market committee, consisting of the representatives of the farmers, traders and commission agents, local bodies and co-operative societies and the State Government. It is a market where the buying and selling of agricultural produce takes place under set of rules and regulations made in this behalf by the State Government, and all malpractices, such as incorrect weighment, excessive market charges, unnecessary deductions etc., are curbed and consequently farmers are able to dispose of their produce at fair prices. Objectives of Regulated Markets The main objectives of regulated market are: 1. To create conditions of fair competition and to ensure a fair deal to the farmers while marketing their produce. 2. To eliminate unfair market practices. 3. To reduce market charges. Regulated markets have several distinctive features. The main features of the regulated markets are: Market for a specific commodity or a group of commodities. Government notification. Market committee. Area of operation. Trade practices.
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Licensing of functionaries. Settlement of complaints and disputes. Reduction in village sales. Fair prices for products. Correct weighment. Uniform unit of quotation. Reduction in market charges. Facilities. Market information. Prompt payment. Elimination of middlemen.
Defects of Regulated markets: Regulated markets are no doubt, of immense help to the grower, seller, buyers, and even to the final consumers. However, they are subject to certain limitations and defects. The draw backs of regulated markets are: Considering the vastness of the country, the number of regulated markets present in the country is still far from adequate.
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Spacious market yards are must for the development and progress of regulated markets. But, on account of the paucity of funds, most of the regulated markets in the country do not have spacious market yards. It is true that regulated markets have ensured correct weights and measures end they have introduced metric system of weights. But the weighment is generally restricted to about 800 lots per day. Most of the grower-sellers have a grievance over the in-ordinate delay in the payment of the price or their produce. They are not able to get the payment for their produce immediately after sale. In most of the regulated markets, the market committees are dominated by traders, and not by the grower-sellers. This works against the interests of the farmers. In some the regulated markets, the market committees are factionridden. They do not very often, function properly. This works to the detriment of the grower-sellers. The organization and supervision of the regulated markets lie in the hands of different departments in different states. This leads to a certain amount of confusion. There is a discrepancy in the notification of commodities to be included in the regulated markets. This discrepancy helps several manipulators to escape from the clutches of the regulated markets. It is said that speculative transactions in the form of forward contracts are under taken in some regulated markets. The deal is settled between the parties out side the market and only fictitious sales and mock auctions are undertaken inside the markets. This defeats the very purpose of regulated marketing.
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Measures for the improvement of Regulated Markets: It is true that regulated markets in the country suffer from a number of limitations. But certainly they have helped to remove the malpractices in the markets and have ensured fair deal to the farmers. So, regulated markets are a must for the successful agricultural marketing in the country. For the promotion and development of regulated markets measures or steps have to be taken: 1. As the number of regulated markets in the country is not adequate, steps should be taken to increase the number of regulated markets. 2. As there is a substantial increase in the arrivals in the regulated markets, the market yards in the regulated markets should be expanded considerably to cope with the increase in the arrivals. 3. There should be more representation of the grower-sellers in the market committees. 4. Through proper supervision and control, the market committees must be made to discharge their duties properly to the advantage of the farmers. 5. For effective supervision and co-ordination of the activities of the regulated market committees, a state agricultural marketing board should be set up in every state. 6. There should be close co-ordination between the Government and the regulated markets so as to strength the administrative system of the regulated markets.
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7. To break the monopoly of the trades in the regulated markets there should be co-operative marketing society in every regulated market. 8. The resources of the market committees should be augmented. 9. All the types of transactions in respect of regulated commodities should be brought under control. 10.Arrangements must be made for speedy weighment of produce. 11.Steps should be taken for prompt payment to grower-sellers.
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CHAPTER V PROFILE OF THE SOCIETY (MAMCOS) Introduction Organization Structure Management Membership Area of Operation Grading of areca nut by MAMCOS Profit distribution Loan advancement and repayment Role of MAMCOS in price stabilization
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Profile of the Society (MAMCOS) Introduction The Malnad areca nut marketing co-operative society, ltd. Shimoga, popularly known as MAMCOS is the leading areca nut processing and marketing agencies in the Malnad region. It is a cooperative society which was established in the year 1939. It has been providing various facilities to the farmer like procurement of areca nut providing loans to farmers etc. The MAMCOS was established under the President ship of Sri. Punnuraj , Deputy Commissioner of Shimoga. It celebrated its Diamond Jubilee in the year 2000 AD. At the time of beginning it is to establish a common place for them on their own, so as to meet the needs of the growers of areca nut. The cultivator had no contact with the distant consuming and distributing centers as such a major portion of the price paid by the consumers was pocketed by the middlemen to come out with these drawbacks, a full pledge co-operative society become inevitable. The MAMCOS came into shoulder with the responsibility as marketing intermediary and it acts as a commission agent.
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Organization Structure of MAMCOS, Shimoga BOARD OF DIRECTOR PRESIDENT VICE PRESIDENT MANAGING DIRECTOR JOINT SECRETARY ASSISTANT SECRETARY CHIEF ACCOUNTANT RECOVERY MANAGER BRANCH MANAGER GO DOWN MANGER
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Management Executive Committee of MAMCOS consists of the President, The Vice President, Secretary and the 17 Directors. The Deputy Commissioner of Shimoga district is the Ex-officio President of the MAMCOS. The Vice President is to be elected by the directors from among them. The Secretary is appointed by the Government of Karnataka. The total numbers of directors are from Shimoga, Bhadravathi, Thirthahalli, Channagiri, Honnali and other 5 directors from Sagar, Shikaripura, Hosanagara and other 5 directors from the entire taluks of Chikmagalur district. It has also reserved one directorship for Women candidate and another for S.C. candidate and also from Shimoga co-operative Bank which provides financial assistance to MAMCOS, a representative nominated by government. Election for directors is held once in 5 years. Membership It was started with 659 members with a share capital of Rs. 16031.00. At present the society have 14816 members and the share capital of Rs. 2,59,23,718. Liability of members The liability of members of MAMCOS is to the extent of full value of shares held by them. His private property is not involved for payment of debts and obligations of the society. Area of operation MAMCOS has administrative area, which includes Shimoga, Chikmagalur, Honnali and Channagiri Taluk of Davanagere Districts. It
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has
branches
at:
SAGAR,
THIRTHAHALLI,
HOSANAGAR,
BHADRAVATHI, KOPPA, SHRINGERI, BIRUR, CHANNAGIRI, SHIMOGA. And its have its agencies at: Jaipura, Kalloni, Basavani, Megravalli, Nagara, Kadur, Kalasa, Kammaradi, Humcha, Kattehakkalu, Trinevi, Uttameshwara, Hariharapura, Sampekatte, Konandur, Tumari, Alagari Mandi, Nittur, Bidargoda.
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Objectives of MAMCOS 1. Make arrangement to dispose plantation such as areca, pepper and soap nut to the best. 2. To grant produce loans on areca, pepper and on other plantation to the members. 3. To let out go downs, shops and to arrange trade fair and exhibitions 4. To make up processing activities, with the permission of the register 5. To take up exporting of areca nut, pepper and other process products 6. To arrange for distribution of Chemical which are required to prevent fruit not diseases (Kole Roga) on cash or credit basis 7. To propagate measurer such as economy in production and self help 8. To supply nitrogen fertilizers and cattle feeds on cash basis. 9. Encouraging the members to produce pure plantation crops such as areca, pepper etc. 10.To take up manufacturing processing storage sale etc., of chemical and fertilizers useful to areca growers and also to take up all necessary activities in this connection. 11.To establish branches, trade centers and sales centers and exhibition if required. 12.The society to work on an agent of the Central Areca marketing cooperative society limited. Mangalore. 13.To take up all such activities as directed by the government connected with the main objectives of the society. 14.To supply ammunition to protect crops from wild animals. 15.If necessary include in business of supplying spare parts of pump sets.
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16.To take up all necessary activities which are required to improve the above objectives. Grading of areca nut by MAMCOS In India very few agricultural commodities consists of multiple commercial varieties. Areca nut is one such commodity it is said that there are about 160 commercial varieties of areca nut though the crop harvested belongs to the same types of areca. In addition to this in certain assembling markets, traders sometimes, deliberately introduce hair splitting the difference in quality in the existing types and thus increasing the multiplicity. Future, grading of areca nut is of multiple dimensional importance. Once cannot overlook this. Both traders and growers have unique advantage by grading price of different grade varies from state to state depending on the quality, demand and other factors of graded areca nut. "AGMARK" for areca nut Areca nut is one of the commodities included in the schedule of agricultural produce grading and marketing act 1937, grading under "AGMARK" in yet to gain importance. But AGMARK grade standards have already been prescribed under the provision of the act for sun dried whole areca nut. The member of the society can avail the facility of grading. Grading of areca nut will be done according to the instruction of the members. To get their areca graded, they should inform before to the hand. Earlier the members grade their areca depending upon the
56
availability of labour with the society. The members have to pay nominal charges for the quantity of areca nut graded. Profit Distribution Profit will be distributed in the annual general body meeting in the following way. 1. Not less than 25% of the profit shall be transferred to reserve. 2. Not less than 25% of the profit shall be paid as dividend to the share holders. 3. In accordance with the statutory provision a certain amount of profit shall be given to the company education fund. 4. The remaining profits will be distributed in the following ways. a) Not less than 12% for the state government share capital reduction fund. b) Not more than 5% to the areca nut research and deplmnt fund. c) Not less than 20% for building construction fund. d) 20% for the welfare of the areca nut growers. e) 3% for the welfare of the laborers. f) 10% for the staff welfare. g) And the remaining is transferred to the common good fund. Loan advancement and repayment Short-term loans: The MAMCOS Shimoga is satisfying the short term requirement of the areca growers. The credit facility is of 3 types. 1. Crop loan 2. Produce loan 3. Fruit root disease loan
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Crop loan First the MAMCOS Shimoga receives applications for loans in the month of May every year. The needy members will apply for the loan. The board of directors will sanction the crop loans without any favorism. Produce loan The produce loan is given to the member against the pledge of areca nut. The growers will pledge the processed areca nut and take the loan. The growers can keep the processed areca nut under pledge. The percentage of produce loan is at rate of 60% of the market value of the areca nut. Fruit root disease loan It is popularly called ' Kole Roga' in Malnad tract. The fruit root diseases will be distributed in the form of Bordeaux mixture of time copper sulphete, gum etc. The loan will be given to the areca grower in the month of August. The MAMCOS Shimoga will supply these above material. Repayment However for smooth running of the process, the growers should be very honest in their loan repayment. Otherwise they will not get loans until they clear the balance. The repayment is done for the sake of produce. The necessary adjustment is done and the remaining is only credited to their account Role of MAMCOS in price stabilization The price of the areca nut is not stable. In recent days the price is declining. Definite reasons cannot be given for the fall in the price, but
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some of the important causes attributed to the fall in areca nut price are as follows: 1. Lack of alternative use of areca nut 2. Fall in consumption 3. Increased production of areca nut. 4. Intermediaries function in the field of marketing. 5. Lack of export potential. 6. Market manipulations. The society purchases areca nut for the Central Areca nut marketing Cooperative society ltd., Mangalore as an authorized agent. In other organization also, purchases of areca according to the needs. Certainly the price stabilization can be achieved up to some extent. Details of Areca received from members at various place in 2009-10 Table: 1 Areca nut collected from agencies: Place Received in Weight in Shimoga Sagar Thirthahalli Koppa Sringeri Birur Shimoga Bhadravathi Channagiri Hosanagara Total bags 32,156 28,811 15,175 6591 6,119 17, 076 17,186 31,854 13,370 15,105 183.443 Quintals 22.31.833 1676154 865934 310614 309542 1,32,970 1292120 2323710 938321 1034336 12115534 Sales in bags 27904 26077 14268 6309 5597 15763 14710 25639 13025 13727 163019 Weight in Quintals 1932634 1518979 909241 296012 279894 1040485 1,101041 1868013 914740 937224 10798263
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(In Gunny Bags)
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Table: 2 Sl. No 1. 2. 3. 4. 5. 6. 7. 8. 9. 10 11 12 13 14 15 16 17 18 19 Places Basavani Megravalli Kmmaradi Ganapathi Katte Bidargodu Jaipura Hariharapura Konandur Vltameshwara Kulaso Nittcer Nagara Humgha Kalloni Trineve Sanpekatte Kadur Thumuri Purappenane In Bags (65Kgs) 1668 1833 2463 3031 1127 4119 1155 782 1014 2928 861 2140 1877 1256 268 784 639 87 91
Details Capital Shimoga
about of
Share
MAMCOS,
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Table: 3 Sl. No 1. 2. 3. 4. PARTICULARS Share Capital at the beginning of the year as on (1-4- 2009) Share Capital from the members in the year 2009-2010 Repayment of share capital to the members in the year (2009-2010) Share capital as on 31-3-10 29710340 in Rs 27691710 2497850 479220
BRANCH OFFICES
Shivamogga Post Box. No. 13, APMC YARD Sagar Road SHIVAMOGGA Phone 08182 250175 08182 250920 Mobile 9449863266 Hosanagara Behind Bus stand Hosanagara Shivamogga Dist. Phone 08185 221376 Mobile 9449863264 Koppa Main Road Koppa Chickmaglur Dist. Phone 08265 221043 Mobile 9449863259 Birur Margada Camp Birur Chickmaglur Dist Phone 08267 255613 Mobile 9449863258 Channagiri APMC YARD Channagiri Davanageri Dist. Phone 08189 228227 Mobile 9449863262 Tarikere Bhadravathi Sringeri Thirthahalli APMC YARD Thirthahalli Shivamogga Dist. Phone 08181 228447 Mobile 9449863267 Bharathi Beedi Sringeri Chickmaglur Dist Phone 08265 250206 Mobile 9449863260 APMC YARD Channagiri Road Bhadravathi Shivamogga Dist. Phone 08282 266239 Mobile 9449863263 Opp. To Bus stand Tarikere Chickmaglur Dist Phone 08261 222368 Mobile 9449863261 Sagara APMC YARD Sagar, Shivamogga Dist. Phone 08183 226047,228007 Mobile 9449863265
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CHAPTER VI ANALYSIS OF SURVEY Analysis and Interpretation of Data Summary of observation
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Analysis of Survey Survey was conducted to know growers preference towards sales through co-operative societies. The question asked to the respondents, can be classified as questions on Agricultural practice and questions on selling practices. A copy of the Questioner is given in Annexure. Table 4: Distribution of growers according to their annual income Income group Below 100000 100000 400000 400000 600000 600000 & above Total Analysis: The above table shows that 20% of the respondents are below Rs.100000. Income per year. 16% of the respondents are Rs.100000-400000 per year and 24% of the respondents are Rs. 400000 600000 per year and 40% of the respondents earn Rs. 600000 and above. The above income groups also number of respondents who preferred arecanut cultivation under their income group. No. of persons 10 8 12 20 50 Source: Survey Percentage 20 16 24 40 100
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Figure-1 Graph shows distribution of growers according to their annual income
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Table 5: Areca nut yield per acre in quintals Quintals Below 5 5 10 10 and above Total Analysis: This sows that 46% of the growers expected to grow around 5 quintals per acre and above that were 24% and 30%. This varied yield per acre shows that there is a lack of scientific approach in agricultural practices. Figure-2 No. of persons 23 12 15 50 Source: Survey Percentage 46 24 30 100
25 23 20
15 12 10
15
0 Below 5 5 10 10 and above
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Table 6: Number of persons cultivating types of arecanut Types Raw or Green Sun dried Boiled Total Analysis: More than 50% of the cultivators were asked making boiled areca nut and 38% of the cultivators asked making sun dried and reaming cultivators asked green nuts. Figure-3 No. of persons 10 19 21 50 Source: Survey Percentage 20 38 42 100
25 19 20
21
15
10
10
0 Raw or Green Sun dried Boiled
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Table 7: Mode of transport used Transport Bullock cart Bus Lorry Others Total Analysis: Mode of transport used by the growers show that, many cultivators preferred transport like lorry and vans to transport their produce. Accordingly 16% cultivators preferred private transport facilities and other 24%. Figure-4 No. of persons 5 8 25 12 50 Source: Survey Percentage 10 16 50 24 100
25 25
20
15 12 10 5 5
0 Bullock cart Bus Lorry Others
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Table 8: Selling centers opted by respondent Respondent Mandi Agent Direct Co-operative society Total Analysis: This shows that many people i.e., 52% of the cultivators sell their produce through cooperative society and others i.e., 8% of direct sales and 22% sell to Mandi and the remaining sale to agent. Figure-5 No. of persons 11 9 4 26 50 Source: Survey Percentage 22 18 8 52 100
Co-operative society
26
Direct
Agent
Mandi
11
10
15
20
25
30
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Table 9: Problems faced by growers Respondent Selling Storage Advance Transport Total Analysis: This shows that there are some defects in co-operative marketing in suiting itself to the needs of the cultivators. When they talk about problems in selling its about lack of price stability and market assistance/ problem of advance refers to the hard and fast rule followed by society in sanctioning advance facility many were not bringing the area nut to the market yard due to high transport cost. The growers felt satisfied with storage facilities many expressed their fears about inefficiency among society officials. Figure-6
1 6 1 4 1 2 1 2 1 0 8 6 4 2 0 Selling Storage A dvance Transport 1 1 1 2 1 5
No. of persons 15 12 11 12 50 Source: Survey
Percentage 30 24 22 24 100
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Table 10: Payment on sales made to the growers immediately Respondent Yes No Total No. of persons 34 16 50 Source: Survey Percentage 68 32 100
Analysis: Immediate payment on sales is made to growers, 32% of the

respondents told that if taken by them previously. There is a need to expand that facility to carry out the practice of direct sales at villages to merchants. Method of sales adopted is tender methods in MAMCOS Shimoga. The question of market rate expected was asked to know the growers expectation and reality. The running rate for that month was Rs.13500 per quintal of area nut. About 60% of the respondents expected in the line of prevailing market rate and 40% were either below the market price or above it. This explains the need to increase the market intelligence awareness among growers. sales about 3 months or 6 months in receiving payment, many explained that sales proceeds adjusted directly to the advance
Figure-7 Graph: Payment on sales made to the growers immediately

No 32%
Yes 68%
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Summary of Observations The study into marketing practices of areca nut cultivators revealed that areca is not considered as much as important commercial crop as it was earlier. But areca is gaining its commercial importance in primary market. On the basis of survey following conclusions can be drawn. Cultivator is not aware of new improved arecanut veins capable or withstanding the disease. He is neglecting the commercial marketing or green areca nut which enjoys fair returns in foreign market. Owing to uneconomical marketing practices, grading and quality control in arecanut produce has been neglected, In order to Capture international market the primary necessity is to provide better returns to the cultivator and encouraging him to practice more arecanut of superior quality. To provide better returns to the cultivators, I believe co-operative marketing has a major role to play. Certainly it is the only marketing intermediaries working for the betterment of areca nut cultivator To sell, a cultivator has three option namely Mandi, Co-operative society, directly to the village trader. His decision to sell through these marketing intermediaries may be influenced by 1) Advance 2) Interest 3) Transport and other practices Advance is a major factor influencing the cultivator. Mandies provide advance on their personnel relationship even for unproductive purposes, but societies provides advance only to productive purpose on sound security from growers. This is an important factor in keeping the
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growers tied with Mandi operators, and 50% of the respondent expressed the problems of advance in co-operative marketing society, Interest rate, is an accompanying factor of advance, astonishingly it does not play a major role more than 26% of the respondents was charged exorbitant rate of interest. Respondents appreciated the rate of interest charged by the society. Transport is also an influencing factor in marketing. These agencies do not provide any transport facilities to grower, nearly 50% of the growers rely on lorries and van transport facilities, this shows a clear need to develop areca nut transport facilities. Here APMC is practicing an appreciating works. It has collecting the agencies located interior parts to collect the areca nut produce and avoid direct sale for lack of transport facility. But there is need to expand this facility. SWOT Analysis of MAMCOS Ltd., Shimoga 1. Strength (a) Financial Base: MAMCOS has more 14,861 members constitute more than 11 crores paid up shares. It is financially strong. (b) Goodwill: MAMCOS was established in 1939 including 659 members with a share capital of Rs. 16,031. But now the membership has grown to has very large number. It shows its goodwill. (c) Administration: The Administration of MAMCOS is best. As a proof it has prompt tax payer award to its credit by the state government. (d) Network
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A unique feature is the network of society. It has 10 branches and 19 agencies all over Malnad. It helps in linking up of farmers very easily e). Diversification: Recently the society has opened the scented areca nut manufacturing unit. It has open a good opportunity for growth in the market where there are only few player. 2. Weakness a) Lack of Social Capital Influence of Mandies has show the growth of capital Mamcos. b) No advertisement Now a days advertisement plays very popular role in making people to know about something. But Mamcos is lacking in it. There is no media advertisement for Mamcos c) MAMCOS has no control over price fluctuation d) MAMCOS is asking in taking active part in the research and development to open new dimensions for areca. 3. Opportunities a). Diversification: There is tremendous scope can be used for diversification. As arecanut can be used for many purposes. b) Demand: MAMCOS can increase the demand for arecanut exporting the same to foreign market. 4. Threats 1. Mushrooming of commission agents in rural areas is a big threat for the society. 2. Govt. may give license for importing or arecanut which may cause price decrease, by
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3. Decrease in the export or ;mica nut to foreign counties is a greater threat to the society 4. Banning of Gutka: - Recently several State Govt. have banned the use of Gutka, for which areca nut is the main input. It has caused a serious decrease and in demand for areca nut. Current Scenario of Arecanut Now a days every field is liberalized welcoming other country. But there is great drawback of this we can see in now a days. The agricultural field is also one among them. Areca price compare to few year ago has decreased by Rs. 7000/- quintal. In the season of areca in large volume the areca was sold but still the middle class people in small amount, and rich in large amount were kept there stock waiting for good price for their stock. But this yei1d is no as such good price for areca. In the areca there are mainly 2 types. 1) Chali Areca which is in white color 2) Red areca The producing of chali areca was simple compared to red areca. So the production of chali areca was high in these years. India was exporting areca to Pakistan and Maldives country. But after Kargil war India stopped exporting areca to Pakistan. Reasons for the short fall in areca price: The only main question, which arises in the minds of farmers, is the reason for the decrease in areca price. They were may be because of:
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1) The liberalization towards the rate of import on areca by the government. 2) The decrease in the rate of import duty from 100% to 35%. 3) The draught in the place where there is a purchase of areca. 4) Financial liberalization. These were some of the reasons for the shortfall in areca price. According to new import policies the rate for importing areca was not yet fixed. So there is no control of government for importing areca. Last year India has imported areca from Sri Lanka in abundance and it has made problem for domestic areca growers. In the last few year areca growers got a good price for their product because of Gutka, Panmasala and other areca products. In some of the states Gutka was banned, as it is injurious to health. This is also one of the reasons for decrease in areca price. Some of the farmer feels that by charging import duty this can be solved. But this will not going to do any thing because of SAPTA (South Asia Preferential Trade Arrangement) treaty. As per this SAPTA treats, the areca which is imported from Sri Lanka and Bangladesh with a discount of 50% in import duty. This was another main reason to fall in the price of areca. According to "State Marketing Board Surveys the revenue to the state from Areca dealings is Rs. 1500 crores. About 50 Lakh people were depend on areca and about 2 crores people were involved in various activities concerned with areca as estimated.
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CHAPTER VII CONCLUSIONS AND SUGGESTIONS Introduction Conclusions Suggestions Other suggestions
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Conclusions and Suggestions Introduction The last question regarding market rate expected worked out as a line dividing the grower expectation and reality. 60% of the respondents are not being on the line prevailing market rate showed a need to improve market awareness and to improve rate of the market return to growers. Conclusions Large amount of areca nut is given by small land holders. But to improve productivity, they have problems like financial assistance, high wages and high rate of fertilizers etc. To overcome these problems, small land holders should be provided with the long term loans and Government should provide supporting prices for the fertilizers and their products. National and Rural development banks must activate in this direction. Steps must be taken to attract more consumers for the areca nut. Popularization about the betel nut must be increased by advertisements and researching is needed about the other uses of areca nut. Suitable scientific methods are needed for the effective production and storing. Research can also be made in this field. When areca nut palm is broken by wind or destroyed by other means, it needs at least 5 years to get the crop. In that case, producers financial position was down so insurance facility must be provided for the crop. In the areca nut market, there are much more mediators therefore growers get only 65% of money of what consumer paid. Another problem is that of unauthorized purchasers, who purchase the products
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by not paying the taxes, which is a heavy loss for the Government and they are also responsible for price fluctuation. It is observed that the current good value of the areca nut is due to Gutka. The care must be taken so that areca nut market should be independent of such commercial items. It is necessary for the management to suit its marketing infrastructure to the needs of growers with in its marketing, managerial and financial setup. The marketing of MAMCOS has analyzed considering opinions of respondents in satisfactory at present however it can impress its marketing program with better marketing infrastructure
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Suggestions In order to introduce reforms one should know the defects and short comings of the prevailing system. This calls for and justifies the necessities of intensive research and investigation of primary market. Marketing is a multistage process for the improvement and development of marketing structure. A Co-ordinate approach arriving at removing all the weak links of the marketing channel is essential. Since one of the common feature of business in 21st century is change. The MAMCOS should term towards more professionalization in management and try to build a social relationship with the members besides this. Society should provide advance facility on a more flexible basis to save cultivators from traps of Mandi Operator. Society should arrange for some sort of transportation facilities to growers to bring their produce to market yard. Collection centers should be expanded into more interior and rural parts. Growers should be made aware of proper quality control and grading practices to earn better returns. Society should provide proper market intelligence to growers.
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In conclusion MAMCOS should achieve a better share to the producer in the price paid by the consumer The success of cooperative society depends upon the effective involvement of members. The slogan of a cooperative society is "each for all and all for each". A producers co-operative society requires for its development proper co-ordination between growers and management. The management of the society should have a clear idea of growers needs and marketing environment. Other Suggestions 1. Most of the cultivators have not adopted modern technology for production of areca nuts. The technology can be used in husking, drying, coloring, slicing, boiling and packaging of areca nut. 2. Irrigation and labor problems can also be reduced by using modern technology. 3. Growers are suggested to take proper care of areca nut plantation apart from measures to protect the main crop. 4. Proper measures to control the disease will give better yield of areca nut. They should replace the old and diseased vines with new and improved breeds of vines. 5. The cultivation should give importance for the growth of mixed crops. 6. Growers should assemble their produce in one place and processing and grading should be carried out collectively to earn better returns for their produce. They should arrange for collective transportation of areca nut produce in their area. This lowers transportation cost.
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7. The unsatisfactory marketing arrangements have been the base of the problem. The large number of the intermediaries functioning in the field of marketing has brought down the producers share in the consumers rupee. This exploitation the producer could be topped only by reducing the number of intermediaries and creating a situation where by the grower will have to say in the matter of regulation of prices. 8. It is necessary to under take suitable propaganda work amongst the growers to make proper processing and grading more popular. So that it fetches higher prices for their produce. 9. The availability of marketing facilities should be within easy reach for the producers. 10.Creation of areca nut board. 11.Co-operative marketing organization like, MAMCOS, CAMPCOS and APSCOS have an important role to play both in providing credit facilities and arranging for orderly marketing. 12.The Government should continue to grant interest loans on the subsidiary. 13.The increased rate on tax should be decreased. 14.The Government should fix a minimum price for the areca nut. 15.By increasing a licensing method, the government should prevent the growth of areca nut. 16.The scope for expanding the export trade is limited. It should be encouraged. 17.Few alternate uses are worth pursuing. Areca nut can be beneficially used in the manufacturing both paste and chewing-gum. It would not
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only increase in the consumption of areca nut within the country but would also lead to export trade in these products. 18.The growers should be aware of price fluctuation associated with Gutka and other commercial products of areca nut, so that future problem is effectively handled.
A NNEXUR E Questionnaire Bibliography
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CULTIVATORS QUESTIONNAIRE I am Venkatesh K.S student of SRS First Grade College, Chitradurga studying in Final Year B.B.M. for the partial fulfillment of my course. I am conducting the survey on the A STUDY OF PRODUCTION AND MARKETING OF ARECANUT IN SHIMOGA-MAMCOS, to prepare a project report. Therefore, I request you to spend for me a few minutes to answer the questions in the questionnaire. Name and Address: 1. Major Occupation: 2. Land holding: 3. Area in Acres: Irrigated Non-irrigated a) Below 1 c) 3 to 6 e) Above 10 4. Areca nut yield in quintals Per acre: 5. Annual Income (in Rs.) a) Below 100000 c) 400000-600000 6. Method of cultivation used: 7. State any special features of areca nut cultivation, if any, adopted in your garden . 8. What are the disease and pests affecting the crop? a) Koleroga b) But rot c) Anaberoga d) Nut Splitting e) Leaf Spot f) Stem Splitting g) Hidimundige roga h) Any other (please specify) 9. Which type of areca nut you produce for market ? a) Raw or Green b) 200000-400000 d) Above 600000 a) Below 5 b) 5 to 10 c) Above 10 b) 1 to 3 d) 6 to 10
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b) Sun dried c) Boiled 10.Method of disposal of nuts a) Through Co-Operative societies b) Through Commission Agents c) Through regulating markets d) Local merchants 11.What is the distance from land to Mandi (in Kms)? a) Below 10 b) 10-15 c) Above 15 12.What is the mode of Transportation used? a) Lorry or Van b) Bullock cart c) Others 13.What is the method of sale adopted? a) Auction b) Tender c) Direct 14.Do you get immediate Payment on sale? If no, what is the period? 15.Any problems in selling through mandi (commission agents) Y/N. (If yes please mention) 16.If need, from which of the Banks following sources you take loans a) Commercial /Agricultural b) Co-Operative societies/ Regulated markets Y/N.
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c) Mandis d) Others. 17.Do you think present prices are Economical, if not, what is the price you expect for your produce? Y/N. 18.Any problems in selling the through co-operative society Y/N Mention them a) Selling c) Advance e) Others 19.Do you get immediate payment on sale a) Yes 20.What is the market rate expected? (In Rs) a) 10000 to 15000 b) 15000 & above 21.Service Provided by MAMCOS a) Excellent b) Good c) Poor 22. Give suggestions, if any, for, Improving the existing market arrangements. Getting higher prices for the produce. 23.Your opinion towards MAMCOS ____________________________________ Place: Date: Signature b) No b) Storage d) Transport
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BIBLIOGRAPHY 1. By- laws 2. Annual Report 3. Indian Economics : : : MAMCOS MAMCOS K.K Deweyy J.D Varma M.L SHARMA 4. Survey of Arecanut crop in Indian Union 5. A study of marketing in India: 6. Marketing Management 7. Adike Pathrike 8. Adike Krishi Website www.mamcos.com www.google.com www.shimoga.net : : : SAXENA SHERLAKAR
A manual for Areca nut growers B. NARAYANA BHAT
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Marketing of Arecanut in Shimoga

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A STUDY OF PRODUCTION AND MARKETING OF ARECANUT IN SHIMOGA-MAMCOS

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

UNDE (BETTE) (Tender whole boiled and dried)

Processed Green Nuts

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

CO-OPERATIVE MARKETING OF ARECA NUT Introduction Objectives Characteristics

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga

SRS First Grade College, Chitradurga