IMPACT OF PRICE FORECASTS IN DECISION MAKING IN CHILLI FARMING – A STUDY IN GUNTUR DISTRICT OF ANDHRA PRADESH
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Date
2016
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Publisher
Acharya N.G. Ranga Agricultural University
Abstract
In recent days there has aroused a question regarding the practical utility of the
price forecasts and there is a need to know how far the farmers are following the
forecast prices based recommendations given by the institutions specifically in chilli
crop and its impact on the decision making of the farmers. Hence the study is being
carried out in order to reveal the after effects of price forecasting and difficulties in it at
various stakeholder levels.
OBJECTIVES
1. To compare the prices forecasted by different agencies over time period.
2. To study the accessibility of price forecasts to farmers in Guntur district.
3. To study the impact of price forecasts in decision making in chilli farming.
4. To identify the constraints in price forecasting faced by different stakeholders.
Multi-stage stratified random sampling design was employed to select a
representative sample of 120 farmers from four selected villages of two mandals in
Guntur district of Andhra Pradesh. Primary data was collected from chilli farmers
through well structured interview schedule. Secondary data was collected from Chief
Planning Officer (CPO) of Guntur, forecasting institutes and other agencies and
Government publications, reports and other published materials. Statistical tools used in
data analysis were arithmetic mean, frequencies, percentages, cost concepts, binary logit
regression and Garrett ranking technique.
By comparing the chilli prices forecasted by different agencies in Guntur district
it was observed that the accuracy of chilli price forecast was more in case of ANGRAU,
PJTSAU, Reliance foundation and Guntur Market Yard Traders Association when
compared to the price forecast by Guntur District Cold Storage Owners Welfare
Association and Vijayakrishna Spice Farms Pvt. Ltd.
Farmers who adopted price forecasts were more educated than non-adopters.
When compared to non-adopters of price forecasts adopters were more among those
who possessed newspaper and krishi magazines. The majority of adopters of price
forecasts belong to medium category whereas majority of non-adopters belong to small
farming category. The average farming experience of adopters was less than that of
non-adopters. Possession of farm assets was more in case of adopters than non-adopters.
The average production and productivity of adopters were more than that of nonadopters.
The total cost incurred and net income realized from chilli cultivation by
adopters was more than that of non-adopters of price forecasts. The average annual
income of adopters was also higher than that of non-adopters of price forecasts.
Majority of the non-adopters were not aware of price forecasts. The major
source of market intelligence was traders and online resources for adopters and fellow
farmers, relatives, friends for non-adopters of price forecasts. All of the adopters of
price forecasts followed price forecast previously also whereas only 36.67 per cent of
non-adopters followed price forecasts previously. Majority of the adopters reported
price forecasts were beneficial to them in taking farm decisions and among the nonadopters
of price forecasts those who followed price forecasts 16.67 per cent farmers
were benefitted from price forecasts.
Education level, possession of communication assets by farmers, average annual
income of the farmers and source of market intelligence to farmers were the significant
factors influencing the adoption of price forecasts by farmers. The impact of adoption of
price forecasts was high in case of decision on storage, followed by decision on quantity
to sell, allotting the area of land for chilli, time of harvesting and selection of crops.
Less impact was identified in case of decision making regarding time of sowing.
Fluctuation in chilli prices and less reliability of the forecasted price were major
constraints faced by adopters of price forecasts. Lack of awareness was the major
constraint in case of non-adopters of price forecasts. Important suggestions given by
farmers were forecasted price consistent with market temperature, consideration of
storage problem and market rush during the recommended month of sale.
Description
D5242
Keywords
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