An overview of agricultural marketing in India

In India there are myths about agricultural marketing. People with less knowledge and with no proper guidance jump into the agricultural marketing and end up in debts and losses. They start  misguiding people about farming.

How is agricultural marketing doing in India?

If done right how profitable can it be?

Here’s an overview of agricultural marketing in India

Agriculture is the primary source of livelihood for about 58 per cent of India’s population. Gross Value Added by agriculture, forestry and fishing is estimated at Rs 18.53 trillion (US$ 271.00 billion) in FY18.

The Indian food and grocery market is the world’s sixth largest, with retail contributing 70 per cent of the sales. The Indian food processing industry accounts for 32 per cent of the country’s total food market, one of the largest industries in India and is ranked fifth in terms of production, consumption, export and expected growth. It contributes around 8.80 and 8.39 per cent of Gross Value Added (GVA) in Manufacturing and Agriculture respectively, 13 per cent of India’s exports and six per cent of total industrial investment.

Market Size

•During 2017-18* crop year, food grain production is estimated at record 284.83 million tonnes. In 2018-19, Government of India is targeting food grain production of 285.2 million tonnes.

  • India is the second largest fruit producer in the world. Production of horticulture crops is estimated at record 314.7 million tonnes (mt) in 2018-19 as per third advance estimates.
  • India is also the largest producer, consumer and exporter of spices and spice products. Spice exports from India reached US$ 3.1 billion in 2017-18. Tea exports from India reached a 36 year high of 240.68 million kgs in CY 2017 while coffee exports reached record 395,000 tonnes in 2017-18.
  • Food & Grocery retail market in India was worth US$ 380 billion in 2017.

Some major investments and developments in agriculture are as follows:

  • Investments worth Rs 8,500 crore (US$ 1.19 billion) have been announced in India for ethanol production.

By early 2019, India will start exporting sugar to China.

  • The first mega food park in Rajasthan was inaugurated in March 2018.
  • Agrifood start-ups in India received funding of US$ 1.66 billion between 2013-17 in 558 deals.
  • In 2017, agriculture sector in India witnessed 18 M&A deals worth US$ 251 million.

Achievements in the sector:

  • Agriculture storage capacity in India increased at 4 per cent CAGR between 2014-17 to reach 131.8 million metric tonnes.
  • Coffee exports reached record 395,000 tonnes in 2017-18.
  • Between 2014-18, 10,000 clusters were approved under the Paramparagat Krishi Vikas Yojana (PKVY).
  • Between 2014-15 and 2017-18 (up to December 2017), capacity of 2.3 million metric tonnes was added in godowns while steel silos with a capacity of 625,000 were also created during the same period.
  • Around 100 million Soil Health Cards (SHCs) have been distributed in the country during 2015-17 and a soil health mobile app has been launched to help Indian farmers.

Road Ahead

India is expected to achieve the ambitious goal of doubling farm income by 2022. The agriculture sector in India is expected to generate better momentum in the next few years due to increased investments in agricultural infrastructure such as irrigation facilities, warehousing and cold storage. Furthermore, the growing use of genetically modified crops will likely improve the yield for Indian farmers.

Agricultural marketing solely depends on the Individual and his farming and marketing skills.