Please use this identifier to cite or link to this item: http://krishikosh.egranth.ac.in/handle/1/5810021909
Authors: Mr. Ketan D. Mendhule
Advisor: Prof. Kalpesh Kumar
Title: FEASIBILITY STUDY FOR LINKAGE OF FARMERS THROUGH CONTRACT FARMING WITH TURMERIC PROCESSING UNIT IN AURANGABAD DISTRICT
Publisher: jau,junagadh
Language: en
Type: Thesis
Pages: 97
Agrotags: management
Abstract: Turmeric is an important spice crop in India. It plays big role from Indian kitchen to export business. India is biggest producer and also the exporter of turmeric having contribution about 78 percent in world trade. In India, Andhra Pradesh is leading state in production of turmeric. In Maharashtra, Sangli district is the main producer of turmeric followed that Hingoli and Aurangabad also have good potentiality for turmeric production. Although turmeric has good market potential but till date the cultivation and post harvest practices are traditionally used by most of the farmers. After harvesting of raw turmeric it must be boiled and dried till 8 per cent moisture, after that it can be sold to market. The boiling and drying of turmeric are more time consuming processes, after boiling farmers dry boiled turmeric on their farm field for minimum 20-25 days and after that it becomes ready for sale in market, and because of it many times farmers did not get benefits of market rates. Nowadays, there are many types of boilers available in market and farmers are using them to do fast and efficient boiling, but till date the drying process is the same. So that, Sahyadri Agro Services, an agro based service provider company decided to establish a boiling and drying plant for turmeric, for that they had decided to purchase raw material from farmers by making contract with them. Kannad and Sillod talukas of Aurangabad district have been selected for the study. This study has been complted under following objectives 1) Study of socio-economic status of turmeric growers of Kannad and Sillod talukas. 2) Study of potentiality for contract farming in area. 3) Study of technical feasibility of processing plant. 4) Study of cost of economics of processing plant. 5) Study of marketing strategy for processing plant. For this study, total 150 farmers have been observed from total ten villages of both talukas. Studied farmers were turmeric growers of that area. For the establishment of plant, company had selected “Chincholi” village which is about 25 km. from both taluka places, also having good turmeric production potentiality. Company had decided to check the feasibility of this project right from contract farming till the processing unit. For the processing of turmeric, company had decided to sale turmeric seedling to farmers with whom they will make contract. Followings are findings under the study. As per the analysis of collected data it can be concluded that among all turmeric growers of study area, 21.33 per cent turmeric growers has belong to young age group, 59.33 percent and 19.33 percent farmers belong to middle age and old age, respectively. About 56 per cent turmeric growers have taken primary education whereas, 28 percent and 7.3 per cent farmers have taken secondary and higher education, respectively. Out of total respondents, about 8.6 per cent farmers are illiterate among total surveyed farmers. From the total 150 farmers about 44 per cent farmers are having medium land holding capacity. Farmers having large land holding capacity are 14 percent among all studied farmers. In the group of large land holding farmers mostly young and educated farmers are there. Small and marginal land holding farmers are 2.6 and 38.66 per cent, respectively. Among all studied farmers about 42.66 per cent of total farmers having borewell in their farms for irrigation, also 27.33 per cent of total farmers are having well. Among all farmers, about 18 and 8 per cent farmers are having canal and river, respectively for irrigation throughout the year. But the 4 per cent of total farmers are totally dependent on rain for irrigation on their fields. The study revealed that, only 23 per cent farmers are from low income group. About 65 per cent of total respondents are belonging to medium income group and 12 per cent farmers have high income. The potentiality for turmeric contract farming has been studied by knowing irrigation facilities on farmer’s field and interest of farmers for contract farming. Out of total respondents of both talukas about 92 per cent farmers have their own drip irrigation system for turmeric cultivation. About 45 percent of total respondents were not interested in contract farming and 6 per cent have not given any response regarding contract farming. By this data we can conclude that about 50 per cent farmers are interested for contract farming. As company has decided to sale turmeric seedlings to farmers so that under this study it observed that about 53 per cent of total farmers were not interested to purchase seedling material from company, but 40 per cent farmers were interested to purchase seedling material and 7 per cent farmers have not given any response. At the beginning stage, project seems totally feasible to start. As company is going to sale seedling material and making contract with farmers so there was not any problem to get 5000 Qt. of raw material for processing. Land and labours were readily available for plant. Out of total cost of Rs. 92, 88,860, the 30 per cent had been owners contribution Rs. 27, 86,658 and 70 per cent were bank loan i.e. Rs. 65, 02,202. Company had decided to purchase plant machinery from “Best Engineering Company Hyderabad”. Also, the required working capital for the purchase of raw material will be arranged by interval selling of final produce in market and also in emergency company will mortgage its final produce to bank and after selling of final produce, company will arrange repayment of working capital. Company were assuming that it will get minimum Rs.10,000 price for its final produce and on that basis of produce company wished to know the feasibility of the project. For the marketing and selling of final produce company had decided to approach various spices manufacturing, medicine and cosmetic manufacturers, exporters, big traders, and online dealers. Company decided to send a sample of its final produce to them for marketing. As company decided to sale turmeric seedling so they were assuming that they will purchase that seedling material at rate 1/4th of market price i.e. about Rs.5000 and will sale it at Rs. 4000 final price to farmers. Also for the additional income the processing of turmeric on rent basis was another aspect. On the basis of these rates of purchasing of raw material and selling of processed turmeric the project cannot be feasible. Because the NPV rate of project comes to -4376529 which is less than zero, and project would be accepted only then, when the rate of NPV more than one. Also the BEP comes at 30 % and DSCR comes 0.55% and minimum DSCR is required 1.5 so this project is not feasible. As company was assuming that they will get minimum Rs.10,000/ Qt. for their final produce on that basis this project cannot be feasible. Because in this project the purchasing of raw material is at Rs. 2500/ Qt and selling of final produce is at Rs.10,000/ per quintal, and after processing the final produce remain 1/4th of raw material. So the charge of processing, interest rate, salary and wages and other expenditure become more than income. So in this project company can get income only when the market price of final produce will be more than Rs.12000/ Qt. So, if company wants to enter in this business, then they must make contract first with buyers of final produce, and then on its basis company can decide the price of raw material.
Subject: Agricultural Business Management
Theme: FEASIBILITY STUDY FOR LINKAGE OF FARMERS THROUGH CONTRACT FARMING WITH TURMERIC PROCESSING UNIT IN AURANGABAD DISTRICT
These Type: M.Sc
Issue Date: 2011-06
Appears in Collections:Thesis

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