Many farmers around Bangalore cultivate and market organic produce – either on their own initiative or because of motivation from NGOs. The product range includes milk, cereals, fruits and vegetables. These farmers face similar problems – availability of quality inputs, economies of scale concerning farm operations, the need for cooperation with neighbours who are conventional farmers, and marketing of produce. The article focusses on marketing issues.
The Experiences
Fruits and coconuts: Yields are seasonal and daily marketing is not necessary. Fruit harvesting is labour intensive and this pushes up costs, but merchants are willing to pay more for assured quality and quantity of organic produce.
The main marketing problem of these products is the large volumes to be harvested and sold. To cite an example, an average farmer has to sell nearly 82,000 coconuts from 565 trees or 650 kg of guavas from one harvest. Organic shops cannot handle such large volumes in one lot. Instead of organised harvesting, if the coconuts are allowed to ripen and fall, a farmer can dispose of 10 to 15 at a time. But then overheads go up and profits come down. An advantage of coconut is that it can be stored in a husked form until prices get more profitable. Middlemen serve as useful intermediaries for small farmers, helping with credit and marketing.
Milk: Being perishable, milk has to be marketed every day. Government milk co-operatives offer a ready outlet. But “organic” milk enjoys no price advantage over “inorganic” milk. Milk is also marketed through local markets. Here too, the price is the same as that of regular milk.
Potatoes: Two NGOs had motivated small farmers to take up potato cultivation on small plots. After facing many problems with procurement of quality organic manure, inputs and good seed material, they had to tackle the question of volumes and prices. First, the quantum produced by each farmer was not big enough to be marketed independently. Secondly, the exclusive outlets for organic produce (discussed below) could not handle the total output of 88,000 kg of potatoes, and had to scout around for other secondary organic outlets. Eventually, one NGO marketed its entire yield (72,000 kg) in the open market, while another opted to market the produce from its farmers (16,000 kg) in the organic market. Staggering the sale by offering only a part of the yield for sale every week meant higher overheads, as well as loss through prolonged storage. Better crop planning by the NGOs, based on study of market damand, would have resulted in a more organised marketing system, with better returns.
Exclusive Outlets for Organic Products
“Econet”, an NGO-run organic shop, offered its consumer members a price comparable to general retail market prices. Farmers’ produce was collected and transported to the outlet, as an incentive to them. However, poor scheduling and irregular volumes had affected the confidence of producers and consumers alike.
“Consumers’ Collective” (CoCo), another direct marketing initiative, had a limited clientele, and faced supply-demand irregularities. This affected the economic viability, and operations to be shelved in the short run.
In both these cases, the low scale of operations critically affected the quantum and kind of products that these outlets could deal with. So, the ability of small farmers to market through an exclusive outlet still remains an unrealised potential.
Lessons learnt
Production planning without understanding the nature organic markets, led to inconvenient production schedules and unmanageable quantities of produce, thereby affecting the confidence of producers and consumers alike. Poor market planning meant that the understanding of consumer needs was weak, and was not reflected in the production cycles of the participating farmers. Not enough attention has been given to developing consumer awareness about organic products, thus affecting the growth of the market.
What next?
Both self-motivated farmers as well as well-meaning NGOs have embarked on organic production without studying the market. The answer to stable organic markets probably lies somewhere between individual consumers and bulk purchasers. In Bangalore therefore, some obvious starting points are student hostels, hotels and nursing homes. These bulk consumers could be motivated into going organic, their consumption patterns over a year worked out, and then production planned accordingly. The marketing of organic produce demands a thorough knowledge not only of sales and marketing, but also of the technical and managerial aspects of production. Educating interested organisations and individuals about these is important to the future of the organic movement around Bangalore.
S.T. Somashekhara Reddy
