Agriculture marketing can be easily understood by breaking it down. Agriculture marketing comprises two words agriculture and marketing. The meaning of the word agriculture is the cultivation of land, and in its broadest sense, it is an activity that uses natural resources for human welfare. Agriculture includes all the primary production activities, but generally, it refers to growing crops and raising livestock only. On the other hand, marketing uses processes and agencies to fulfill the interest of people involved by moving the goods from production to the point of consumption. All the activities involved in marketing create form, place, possession, and time utility. There are many definitions for marketing; some of the popular ones are as follows.
Philip Kotler states, “Marketing is a human activity that satisfies the needs and wants through an exchange process.” (Kotler et al., 1990)
On the other hand, the American marketing association defined marketing as “an activity, set of institutions, and process for creating, communicating, delivering and exchanging offerings that have value for customers, clients, partners, and society at large” (American Marketing Association, 2017)
Thomsen defined agricultural marketing as “the study which comprises all the operations and the agencies conducting them, involved in the movement of farmproduced foods, raw materials and their derivatives, such as textiles, from the farm to the final consumers, and the effects of such operations on farmers, middlemen and consumers” (Thomsen, 1951).
Agriculture marketing can be defined as the set of activities, processes, and agencies involved in creating, communicating, delivering, and exchanging agriculture and its allied products that have utility for customers, clients, partners, and society at large.
Agriculture marketing is considered to deliver the produce from the production side to the consumption side, but agriculture marketing is nearly the same as any other sector except for the nature of the product, resources, dependence on nature, etc. (Acharya & Agarwal, 2019).
Agricultural marketing includes all the activities, policies, and agencies involved in providing farm inputs and transferring farmers‘ produce to the consumers. Nearly every sector directly or indirectly needs agriculture or its allied produce. Agriculture marketing is a link between the farm and non-farm sectors.
National commission on agriculture (XII Report, 1976) defined agricultural marketing as “a process which starts with farmer‘s decision to produce a marketable farm commodity, and it involves all the aspects of market structure, both functional and institutional, based on technical and economic considerations, and includes pre-and post-harvest operations, assembling, grading, storage, transportation, and distribution.” (National commission on agriculture, (XII Report), 1976)
Agriculture marketing in developing countries like India can be understood from the perspective of two major sub-systems; product and factor marketing. The product marketing sub-head includes all the actors involved in delivering the product to the consumer after the farmers have produced it. For example, it include; farmers, village traders, wholesalers, processors, importers, marketing cooperatives, retailers etc. The second sub-system, factors marketing, includes all those actors involved in the supply of inputs that the farmers in the production process have used. It includes input manufacturers, distributors, importers, exporters, etc. The agriculture sector, in order to grow and develop itself properly, needs all the inputs required in the production process, such as fertilizers, pesticides, farm equipment, machinery, diesel, electricity, water etc., and the sector also needs all the services and activities required to market the product for instance; transportation, storage, milling or processing, packaging, etc. (Acharya & Agarwal, 2010).
Agriculture marketing thus comprises all the activities involved in the supply of farm inputs to the farmers and in the movement of the farm’s produce from farmers to the consumers. Agriculture marketing also includes the system which assesses the demand for farm inputs and policies and programs relating to the pricing, handling, purchase, and sale of farm inputs and agricultural products. Trade in the domestic and international markets also becomes part of agricultural marketing.
Scope and subject matter of Agricultural Marketing
Agriculture marketing is the marketing of farm inputs used by farmers in the production and marketing of farm produce, which farmers produce in their fields. Thus agriculture marketing includes product and input marketing (Acharya & Agarwal, 2010). The importance of output marketing has become more conspicuous in the recent past with the increase in the marketable surplus of agricultural produce due to technological breakthroughs. The first problem created by this surplus is the problem in distribution to consumption centers and the other problem is to transform agriculture into a commercial venture where markets need to come to the limelight. Input marketing is comparatively new than product marketing (Senapati, 2014). The purchase of inputs for production purposes was negligible because farmers used farmyard manure and local seeds that were available with them quickly. In the last few decades, the importance of farm products such as improved seeds, pesticides, insecticides and fertilizers, farm machinery, credit, etc., has been increased.
Additionally, the present technology for agriculture is entirely input responsive. Thus, the scope of agricultural marketing includes both product marketing and input marketing (Venugopal & Kaundinya, 2014). The subject of agricultural marketing is vast; some of the crucial areas are; marketing functions, marketing institutions, agencies, marketing channels, efficiency, cost, price spread, market integration, producer‘s surplus, government policies, import and exports of agricultural commodities, and futures trading, etc.
Importance of Agriculture Marketing
Agriculture marketing stimulates production and consumption and plays a vital role in economic development by acting as an essential multiplier of agricultural development. In the last few decades, Indian agriculture witnessed a technological breakthrough; high-yield variety seeds, fertilizers, tractors and other new machinery, and many more, which led to a substantial increase in agriculture production and a highly marketable and marketed surplus. To maintain this pace, the farmers need to get a good amount for their products which can be assured by developing an efficient marketing system. In developing countries like India, where most of the population is engaged in the agriculture sector, the agricultural marketing system plays a very important role in economic development. Agricultural marketing in these countries plays a dual role; firstly, the agricultural marketing system transmits crucial price signals that help farmers make decisions regarding which crops to grow by making them aware of the socio-cultural, ecological, and economic constraints. On the other hand, agricultural marketing also contributes to the growth of the non-agricultural sector by providing them an opportunity to invest in the agriculture sector and use the agricultural produce (Acharya & Agarwal, 2019). The importance of the agriculture marketing is understood from the following points:
- Optimization of resource use and output management- An efficient marketing system reduced the overall cost to the minimum possible level (without compromising quality) and increased the output to the maximum level (without compromising quality). This contributes to the development of the agriculture sector.
- Increase in farm income- An efficient marketing system provides better methods to the farmers and guards them against the malpractices of the middlemen, control the cost of marketing services, and ensures a reasonable price for the farmers. An inefficient agricultural marketing system can lead to significantly less incentive for the producers and, therefore, can be a hurdle in the development of the farmer and the overall agriculture sector.
- Widening of markets- Agriculture marketing ensures a good exposure for farmers’ produce to new markets by making farmers capable of marketing their produce from remote areas to the other unexplored areas within and outside the country. Efficient agricultural marketing systems by widening the markets help the farmers increase their incomes.
- Growth of Agro-based industries- An efficient agricultural marketing system helps in the growth of agro-based industries and stimulates the development process of the agriculture sector and the development of the economy. Many industries like jute and food processing depend on the agriculture sector for supply of raw materials.
- Price signals- An efficient agricultural marketing system (by transmitting) price signals makes farmers easily plan their production according to the needs of the economy.
- Adoption and spread of new technology- An efficient marketing system allow farmers to use the most appropriate new technology for their practices. New technology requires high investment, and the agricultural marketing system promotes new technology by assuring the farmers that the technology (technology will provide the market clearance at a remunerative price).
- Employment creation- Agricultural marketing system includes several activities like; packaging, storage, processing, etc. It also required commission agents, brokers, regulating staff, etc. Hence, it employs many people.
- Addition to National Income- Efficient agricultural marketing system increase the production as well as the income of farmers along with the people engaged in the system, thereby increasing the nation‘s GNP and GDP.
- Better standard of living- It is essential for any program designed for poverty reduction to focus on the prevailing marketing systems and make them efficient. An efficient agricultural marketing system leads to an increase in the income and the living standard of the rural population. Thus it reduces rural poverty, a primary concern in developing countries like India.
- Creation of utility- Efficient marketing adds cost to the product and adds utilities.
For citing this article, use:
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Abad, A. (2022). An appraisal of marketing channel efficiency of agricultural marketing cooperative societies a select study of delhi state.
