FOOD CORPORATION OF INDIA (FCI)

Date of Establishment

• FCI was set up on 14th January, 1965

(by an Act of Parliament)

OBJECTIVES OF FCI

1. To act as an main AGENCY OF GOVERNMENT for handling FOOD-GRAINS.

2. To PROCURE FOOD-GRAINS on behalf of Govt. of India.

3. To act as MARKETING AGENCY in the country.

4. To serve the interests of both the FARMERS and CONSUMERS.

5. To provide REMUNERATIVE PRICE to farmers for his PRODUCE.

6. To supply regularly food grains to VULNERABLE SECTIONS of Society (Poor People) all over the country at REASONABLE and subsidised PRICE.

7. To intervene in Market for PRICE STABLIZAATION.

FUNCTIONS OF FCI

The Main Functions of FCI are as under :-1. To procure Food-grains and other

Agricultural Commodities at incentive prices from the Farmers on behalf of Central and State Govts.

2. To make timely releases of the stock through the PUBLIC DISTRIBUTION SYSTEM (PDS) i.e. Fair Price Shops and Controlled items Shops for consumers, especially to poor people in REMOTEST CORNERS of the country.

3. To set-up a PURCHASING and DISTRIBUTION net-work to minimize seasonal price fluctuations in the market.

4. To build-up and keep a SIZEABLE BUFFER STOCK OF FOOD-GRAINS to meet the situations that may arise as a result of SHORT-FALLS IN INTERNAL PROCUREMENT and Imports (for FOOD SECURITY).

• Buffer-stock is maintained to meet-out the unforeseen situations like :-– Low Production of Food grains.– Natural Calamities (Flood, Drought, War etc.).– Crop Failure ( 1965-66 and 1966-67 in India)

and there was shortage of food grains (Scarcity) in these two years.

• It gave momentum to have GREEN REVOLUTION.

ORGANIZATIONAL CHART OF FCI

• CORPORATE OFFICE

• ZONAL OFFICES (5)

• REGIONAL OFFICES (23)

• DISTRICT OFFICES (165)

• DEPOTS. (INCLUDING CAP --Covered And Plinth- (1470) WITH 1646 OFFICES.

CORPORATE SET-UP

BOARD OF DIRECTORSI

CHAIARMANI

MANAGING DIRECTOR(MD is Ex-Officio Mg. Director of Central Ware-housing Corporation also)

GOVERNMENT REPRESENTATIVES

• 3 DIRECTORS to represent respectively the Ministries of the Central Govt. dealing with :

– FOOD– FINANCE– CO-OPERATION, &

• 6 OTHER DIRECTORS (out of which 4 are Non-official Directors).

UNIQUE FEATURE OF FCI

• It is ISO 9001 :2000 CERTIFIED. (Meaning thereby – Ensuring Food Security of Nation).

ZONAL OFFICES

(1) NORTH ZONE Uttaranchal, U.P., Rajasthan, Punjab, J&K, H.P., Delhi andHaryana.

(2) EAST ZONE Jharkhand, Bihar, Orissa, W.B.(3) WEST ZONE Chhatisgarh, Gujarat, M.P.

Maharashtra.(4) SOUTH ZONE Andhra Pradesh, Kerala,

Karnataka, Tamil Nadu.(5) N-E-FRONTIER Nagaland, Meghalaya, Assam.

Progress of the FCI in various areas may be assessed from the following seven points:-

1. PROCUREMENT2. STORAGE3. TRANSPORTATION4. IMPORTS5. DISTRIBUTION6. PROCESSING7. CONSULTANCY

PROCUREMENT :-• Procure means to obtain by care or to acquire

Something. • FCI undertakes procurement of Food grains on

behalf of Central Govt. and State Govts.• Procurement is done by FCI or through other

Public Procurement Agencies such as :– Cooperative Marketing Societies– Krishi Upaj Mandi Samities (KUMS)– Other Mandis– Cooperative Societies including PACS

• FCI predetermines support prices for Cereals and are made available for Farmers.

• Handling of huge stocks procured by other agencies is done by FCI.

• FCI purchases food-grains in RABI AND KHARIF Seasons directly or through the Cooperatives/ Purchasing Agents.

• FCI purchases cereals & pulses at Market price to --

• Supply them to Defence Services.

• FCI utilizes the services of Cooperative Societies to the Maximum Extent possible for Procurement, Storage and Distribution of Foodgrains and other Commodities.

(2) STORAGE OF FOODGRAINS BY FCI– Scientific Storage is done by FCI for food

grains – From procurement till distribution.– Procurement from Farmers is done

• Distribution is done to various people :– To Remote Areas; Hilly/Desert area.– To Poor People of Rural area.– To Poorest of the Poor in Village area.– To Public at large to common man.

Buffer Stock is maintained by FCI :

a. Food grains are stored in Godowns & Warehouses.

b. Godowns & Warehouses are constructed scientifically for protection against –

• Dampness (Moisture in Air)• Rats, &• Fungus (Mushroom/allied plant)

c. Till 1968, godown construction was banned. After 1968 Godown Construction started in every State and Districts for storage of food grains and other Commodities.

d. After Green Revolution in our Country, the need of Storage increased.

Construction of Godown were done near Production and Consumption

Centres.

• GOI also encouraged Private parties to construct Modern Food grain Godowns on a Guaranteed Occupation basis.

• Constant and Effective Inspections and Treatment of Foodgrains in Storage was ensured by FCI so that the stocks are kept in Good Conditions.

• Preservation of Stocks is done by FCI.

STORAGE IS DONE IN 3 WAYS :• In Godowns -

500/1000/2000/5000/10,000 MT• In Silos (Tall & massive structures)• In CAP (Cover And Plinth)- In Large

open areas with Polythene Covers at bottom and Top- Bags are kept in open (Thousands of bags are kept at one place).

• Construction of SILOS by FCI is done for bulk Handling and storage of food grains (with mechanical handling for filling and for taking out of the silos). Silos construction has been done in FOUR STATES by FCI :

– PUNJAB– HARYANA– DELHI &– UTTAR PRADESH

(h) Safe storage of Food grains is ensured by FCI through - Chain of 138

Laboratories & Quality Control Laboratories by doing following activities :-

(i) Blow Air in Godowns(ii) Rotate Stocks – Bags are shifted i.e.

Change of place is done(iii) Bags and Godowns are fumigated (fumes

are spread over (Smokey perfumes are Spread- over to kill the pest, flies and Other fungus etc.

• FCI uses Air-strips, Army Barracks, and former Palaces for the storage of food grains during massive production season.

TRANSPORTATION BY FCI :-

• Transportation of Food grains is generally done by –

(a) Rail and (b) Road

• Rail and Road Transportation is used for timely supply of food grains in the areas of Consumption and Storage.

• FCI maintains a steady Public Distribution System (PDS) from the procurement centers and the ports to the areas of consumption and storage. FCI is one of the largest users of the Railways. More than 20 million tonnes of Food grain is transported through RAIL by Food Corporation of India.

• IMPORTS OF GOODGRAINS BY FCI –– Imported food grains are handled by FCI.– Import is through Shipment to all Major

Ports. i.e. Mumbai, Goa, Calcutta, Koshin, Vishakhapattanam.

– This responsibility was given to FCI in 1969-70.

– Imported Food grains are speedily dispatched to various destinations to avoid congestion at the ports.

– Supply to needy area is made immediately by FCI.

• DISTRIBUTION OF FOODGRAINS BY FCI:-

– Distribution function is one of the important Function of FCI.

– Procured/Imported food grains is distributed to public through 4.91 Lacs FAIR PRICE SHOPES all over India.

Food grains are issued on the basis of allocation made by the Central Govt. at reasonable prices :-

(i) How much (quantity)

(ii) To whom (State-Area &People)

(iii) At what Rate (Price or Rate )

(iv)Type of Food grain (Wheat, Rice etc.)

(v) For open sale.

PROCESSING OF FOODGRAINS BY FCI

• FCI has done commendable work in the field of Food-Processing

• FCI has set-up 24 Modern Rice Mills• Paddy-processing Research Centre at

TIRUVERUR in Tamil Nadu ( with GOI collaboration).

• Solvant Extraction Plant in TN – Edible oil and industrial grade oil from Paddy.

• Paddy Dryers in Thanjavur district in TN.

• Maize Dryer at KHANNA in Punjab ( to reduce the moisture content from maize) to save from diseases.

• Solvant Extraction Plant of FCI at Ujjain (MP) to process Groundnut.

• Maize Mill of FCI at Faridabad (Haryana) to manufacture a variety of Maize Products.

• Dall Mill off FCI at Lucknow (U.P.) to meet out the purchase requirement of the ARMY.

• Protein-rich Food (Balahar) a midday meal for school children ( a mix of wheat flour, groundnut meal, vitamins and minerals)— FCI produces 40,000 MT per Annum Balahar.

CONSULTANCY

• Consultancy is a new function of FCI. It provides guidance to private entrepreneurs.

• Provides Technical & Scientific assistance to Public and Private Undertakings and to Cooperatives.

• Provides assistance in the Modernization of RICE AND DAL MILLS and other Agro-Processing units.

• Provides Feasibility ad Techno-economic studies, market survey and Management systems to those who need it.

• FCI also collects and manages Levy Sugar on behalf of the Government of India.

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BUFFER STOCKING

• The Term “Buffer Stock” of food-grains refer to the Stock of Food-grains maintained by the Govt. to be used as a buffer :-– To cushion the stocks of fluctuating supply of

price,– To meet the emergency needs and,– To meet the situations arising out of

unexpected shortages resulting from following:

– (i) Transport bottlenecks,– (ii) Natural Calamities (War, Famine)– (iii) From the influx of Refugees.– ADVANTAGES OF MAINTAINING A BUFFER

STOCK:--– 1.It helps in the stabilisation of prices by

counter acting the effects of the activities of speculators and Hoarders.

• 2. It safeguards the producers against low prices, especially during surplus production years and,

• 3. It imparts stability to the country’s food-economy.– The Govt. enters the market and purchases

food-grains for the maintenance of the buffer-stock. Buffer-stock is maintained by – (a)Internal purchases and (b) by Imports from foreign countries.

• Buffer stock is maintained by FCI.

• 20 Million Tonnes of Food-grains stock requires for India. As on 1-7-1990 stock of food-grain was maintained by India was 20.3Million Tonnes. – Stock Required and Maintained by FCI was

as under :--

• Year Minimum Norms . Actual Stock.• 1995 15.4 MT 30.3 MT• 2000 16.8 MT 31.4 MT• 2003 16.8 MT 64.7 MT• 2005 16.8 MT 16.2 MT• 2006 16.8 MT 15.7 MT• 2007 16.8 MT 17.88 MT• 2008 16.8 MT 19.64 MT• 2009 16.8 MT 35.03 MT

• ACTUAL BUFFER STOCK POSITION OF WHEAT AND RICE (in Lakh Tonnes):-

• -------------------------------------------------------• Year Wheat Rice Total• -------------------------------------------------------• Jan.2007 54.28 119.77 174.05• Jan.2008 77.12 114.75 191.87• Jan.2009 182.12 175.76 357.88

» (Against a Total Target of 200 Lakh Tonnes).

• PUBLIC PROCUREMENT OF FOOD-GRAINS:– Public procurement means securing food-

grains by the Govt. or its agency (FCI) to meet the requirements for the supply to consumers through Fair Price Shops and to meet emergency needs in Agriculturally Lean years (low production years). The prices at which the procurement operation is carried out are referred to as procurement prices.

– Procurement prices may be higher or lower than the Market prices. Since 1971 the procurement prices were treated as Support Price.

• PROCUREMENT PRICES = SUPPORT PRICES

• Till 1990-91, the procurement system was in operation for Cereals (i.e.Rice Wheat, Maize etc.). Procurement agencies tried to procure pre-decided quantities at these prices.

– When targets of procurement are not achieved, then Govt. puts RESTRICTIONS on movement of Food-grains from :-

– (i) Inter-State (one state to other state),– (ii) Inter District (one district to other district).– Thus by imposing restriction on movement,

the prices are depressed in surplus regions and procurement is done by the Agencies (FCI or Coop. Mkg. Society).

• Question : How procurement targets are achieved by Govt. for procurement of Food-grains ?

• Answer: Apart from the imposition of movement restrictions, several other instruments are also used at different stages and time to achieve the procurement targets.

• 1. LEVY ON PRODUCERS.• 2. LEVY ON TRADERS AND MILLERS.• 3. PRE-EMPTIVE PURCHASES.• 4. OPEN MARKET PURCHASES.• 5. MONOPOLY PROCUREMENT 1. LEVY ON PRODUCERS:

It is a legal obligation on producers to sell a part of their produce to the Govt.,

• Procurement price. The quantity to be procured by the Govt. is fixed in proportion of Acreage under the crop in that year, or at a Flat-Rate.

• Example:

• (i) 10 Acreage Wheat - 1 acre production is procured by Govt. at Procurement price.

• (ii) 10% of Total production to be procured by Govt. through :--

• (a) FCI• (b) Coop. Marketing Society.• (c) Any other Agent appointed by Govt.

(KUMS or Mandi Yard).• (d) Private Traders on a fixed commission

basis (Say Rs.20 per Quintal)

– Thus, Govt. procures food-grains from a large number of farmers through-out the country.

2. LEVY ON TRADERS AND MILLERS:Traders and Millers are legally

bound to deliver a fixed percentage of the food-grainspurchased or processed by them to the Govt. at the Announced Procurement Prices.

Traders and Millers are free to sell the remaining quantity in the open market at the

• Prevailing prices.• Example: At present, Sugar is procured

from Sugar factories by imposing a Levy on the quantity of Sugar processed by them.

Similarly, RICE : Rice-millers are required to hand-over a fixed percentage of Rice milled by them to the Govt. at a Fixed Price.

3. PRE-EMPTIVE PURCHASES:– (First Right of Purchase with Govt.):– The Govt. purchases foodgrains in the open market

at a price settled between the Trader and producer. Govt. assumes its first right to purchase the grains.

4. OPEN MARKET PURCHASES:

The Govt. or its agency enters the market as a trader and buys the produce after competing with other Traders. No price is announced before- hand.

• 5. MONOPOLY PROCUREMENT:• Govt. acquires monopoly rights for the

purchase of food-grains from the farmers.• Traders are not allowed to enter the

market for this purpose. Govt. uses the Infrastructure in terms of –

• (i) Manpower (ii) Storage Godowns• (iii) Finance & (iv) Transport facilities, for

Procurement of Foodgrains.

• Food-grains procured are Wheat, Rice and Coarse grains (Maize, Bajra, Jowar etc.).

• Wheat & Rice constitutes – 98%• Coarse grains accoount for –2% of the

Total procurement.

PROCUREMENT PERIOD:

1. Rabi Mkg. Season –for Wheat :April-June.

2. Kharif Mkg. Season- for Rice : Oct. 1 to Sept.30.

• CONTRIBUTION OF STATES IN PROCUREMENT OF FOOD-GRAINS:--

• Punjab, U.P., Haryana & A.P. constitute 85 to 90% of the total food-grains Procurement. (of which Punjab contribute about 50%).

• For RICE:-Punjab, Haryana & A.P. and

• For WHEAT:- Punjab, Haryana & U.P.

• Account for over 95% of the total procurement, in recent years.

• PROCUREMENT OF FOOD-GRAINS BY FCI (From 4 States) is as under :

• WHEAT (Punjab and Haryana):

• 2006-0799.5%

• 2007-0891.1%

• 2008-0966.88%

• RICE (Punjab, Haryana, U.P.and A.P):--

• 2005-06 68.8%

• 2006-07 69.7%

• 2007-08 69.46%

• Improvement in Procurement for Rice during 2007-08 was in the States of Andhra Pradesh, Orissa and West Bengal.

• In Wheat procurement, improvement was observed during 2008-09 in the States of Punjab, M.P., U.P., & Gujarat. (Rabi Mkg.)

• PROCUREMENT PRICES:• Year Wheat Rice Maize.• 2006-07 750/- 745/- 550/-• 2007-08 850/- 775/- 620/- • 2008-09 1000/- 850/- 840/-• 1080/- 880/-

• The Govt. is increasing MSP from time to time for Wheat, Rice and other grains.

ADMINISTERED PRICES

• The following are termed as Administered Prices:--

• 1 Commission for Agricultural Costs and Prices (CACP).

• 2. Minimum Support Price (MSP).

• 3. Procurement Prices (PP).

• 4. Market Intervention Scheme (MIS).

• 5. Statutory Price Control & Rationing.

1. CACP (Commission for Agricultural Costs and Prices:-

• A) Administered Prices are nothing but various methods of intervention in the Market prices which includes following:-– (i) Minimum Support Prices,– (ii) Statutory Minimum Prices,– (iii) Procurement Prices, and– (iv) Issue Prices.– These prices are announced for different

• Agricultural crops by the GOI on the recommendations of CACP (Commission for Agricultural Costs and Prices).

• CACP was originally set up in January, 1965 in the name of the Agricultural Prices Commission (APC).

• The CACP take cares of interest of the Producers as well as that of Consumers.

• The Commission (CACP) when recommends the price, considers the following aspects :--

• (i)The need for incentives to Farmers for the adoption of improved Technology and Ma ximization of production;

• (ii) The need for ensuring a rational utilisation of land and other production resources; and

• (iii) The likely effect of the price policy on the rest of the economy, particularly on the cost of living of masses and industrial cost structure.

• The Commission has been administering two sets of administered prices viz., MSP and PP(Procurement Prices.

• CACP is a Statutory body.• CACP submits separate reports for Kharif

and Rabi season crops about the recommended prices.

• The Central Govt. takes decision on the recommended prices after considering the views of State Govt. on the basis of Demand and Supply situation in the country.

• The Chairman of CACP is an eminent and experienced Agricultural Economist. Few of the eminent Economists were as under:– 1. Prof. M.L. Dantwala (1965-66),– 2. Prof. Dharma Narain(1970-75 &76-78)– 3. Dr. S.S.Acharya (1992-1996)– 4. Dr. T. Haq (2002- )– 5. Dr. S.S. Acharya

MINIMUM SUPPORT PRICE

• MINIMUM SUPPORT PRICE (MSP):• MSP is the price fixed by the Govt. to

protect the producer-farmers against excessive fall in price during bumper production years. MSP is a guaranatee to the farmers which means that a price not lower than the announced minimum price will be paid to the farmers when they bring their produce for sale in the market.

• ANNOUNCEMENT OF MSP:

• MSP for different agricultural crops are announced by the GOI before the start of the sowing season of the crop. Following Crops are covered:– 1.Foodgrains;(cereal & pulses)– 2.Oilseeds 3.Fibre Crops (Cotton & Jute)– 4.Sugarcane 5. Tobacco.

REVAMPED PUBLIC DISTRIBUTION SYSTEM (R-PDS): A RPDS was launched on Jan. 1, 1992 and made effective from JUNE 1, 1992.

AREA COVERAGE: RPDS was started in selected Blocks of country:(i) Drought Prone Area(ii) Desert Area(iii) Tribal Area, and (iv) Hilly Areas.

MAIN FEATURES OF RPDS:

• 1. In addition to Essential Commodities (Wheat, Rice, Sugar,Edible Oils, Soft Coke, Controlled Clothe and Kerosene (Seven items) included in the general PDS, it includes additional items of daily use like : Tea, Soap, Pulses and Iodised Salt.

• 2. These items are delivered by the Govt. at the door of the Fair Price Shops so as to minimise the delay and leakage, and

• 3. A Vigilance Committee for each Village, consisting of local persons is constituted for a watch on the Distribution System.– The Revamped PDS was initially operated in

1775 Blocks in Tribals, Hilly and Arid (desert) areas having poor infrastructure (i.e. No connectivity by Pucca Road).

– Under this system, Food-grains – Rice and Wheat are allocataed to State/UT at prices

• Lower by Rs. 50/- per quintal than the Issue-Prices for general PDS.

• TARGETTED PUBLIC DISTRIBUTION SYSTEM ( TPDS):-– The GOI has been continuously reviewing

and announcing some changes in the PDS and termed as the TPDS.

ESSENTIAL FEATURES OF T-PDS:

• Features at the time of launching the TPDS were as under :-

• (i) The State Govt. would identify the families Below Poverty Line(BPL) who woild be issued 10 kg. or more of foodgrains per month per family at prices almost HALF-the normal Central issue prices for general PDS.

• (ii) Population above the poverty-line (APL)- now under PDS would continue to receive at the Normal Central Issue price.

• (iii) The supply of foodgrains for the BPL population at 10 kg. per family per month shall be guaranteed to State Govt./UT by the Central Govt.

• (iv) The State Govt. will be free to add to the quantum, coverage and the subsidy

From their own resource, and

(v) The subsidised foodgrains will also be issued to all beneficiaries under the Jawahar Rozgar Yojana (JRY) as per guidelines at the rate of one kg.per manday for which food coupons would be issued to benefeciaries for exchange at Fair Price Shops.

FOODGRAINS FROM 2003 TO BPL FAMILIES :

• (a) 35 Kg. Food-grains to BPL faamily from 1-4-2003 per famaily per month at a price which was 45% of the Economic Cost.

• (b) 15 Million Poorest of the Poor (Antodaya families) were being supplied :

• Wheat at Rs. 2/- per kg. and • Rice at Rs. 3/- per kg. under Antodaya

Anna Yojna (AAY).

FOOD SECURITY PROGRAMME:

– Apart from the above (two schemes) the food Security programmes included the following for BPL and poorest of the poor families:-

– (i) Mid-Day Meal scheme for School Childrens.

– (ii) Supplementary Nutrition Programme for under 6 years of age children and Pregnant and lactating mothers.

• (iv) Supply of foodgrains to SC/ST Hostels and hostels run by Social Welfare De;patment, and

• (v) Supply of foodgrains under Sampurna Gramin Rojgaar Yojana (Total Rural Employment Scheme).

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APEDA

• AGRICULTURAL AND PROCESSED FOOD PRODUCTS EXPORT DEVELOPMENT AUTHORITY (APEDA):

• 1. Established in 1985 under the Act passed by the Parliament in Dec. 1985. The Act was made effective from 13th Feb. 1986 by a notification issued in the Gazette of India. (Replaced by PFEPC).

FUNCTIONS OF- APEDA:

• 1. Development of Industries relating to the Scheduled products for export by way of providing financial assistance or otherwise for undertaking surveys and feasibility studies, participation in enquiry capital through joint ventures and other reliefs and subsidy schemes;

• 2. Registration of persons as Exporters of the scheduled products on payment of such fees as may be prescribed;

• 3. Fixing of staandards and specifications for the scheduled products for the purpose of exports;

• 4. Carrying out Inspection of meat products in slaughter houses, processing plants, storage premises, conveyances or other places where such products are kept or handled for the purpose of ensuring the quality of such products;

• 5. Improving of packaging of the Scheduled products;

• 6. Improving of marketing of the Scheduled products outside India;

• 7. Promotion of export oriented production and development of the Scheduled Products;

• 8. Collection of statistics from the owners of factories or establishments engaged in

• In the production, processing, packaging, marketing or export of the Scheduled Products or from such other persons as may be prerscribed on any matter relating to the Scheduled Products and publication of the statistics so collected or of any portions thereof or extracts therefrom;

• 9.Training in various aspects of the industries connected with the S-Products.

PRODUCTS MONITORED BY APEDA:

• APEDA is mandated with the responsibility of Export promotion and Development of the following Scheduled Products:-

• 1. Fruits, Vegetables and their Products.• 2. Meat and Meat Products.• 3. Poultry and Poultry Products.• 4. Dairy Products.

• 5. Confectionery, Biscuits and Bakery Products.

• 6. Honey, Jaggery and Sugar Products.

• 7. Cocoa and its products, chocolates of all kinds.

• 8. Alcoholic and Non-Alcoholic Beverages.

• 9. Cereal and Cereal Products.

• 10. Groundnuts, Peanuts and Walnuts.• 11. Pickles, Papad and Chutneys.• 12. Gaur Gum.• 13. Floriculture and Floriculture Products.• 14.Herbal and Medicinal Plants.• 15. Rice (Non-Basmati).• 16. To monitor exports of some non-

scheduled items such as Basmati Rice, Wheat, Coarse Grains and also import of Sugar.

• COMPOSITION OF THE ‘APEDA’ AUTHORITY:

• APEDA Authority consists of the following members :-

• A Chairman, appointed by the Central Govt.

• The Agril. Marketing Advisor to the GOI, ex-officio;

• One member appointed by the C.G. representing the Planning Commission.

• Three members of Parliament off whom two are elected by the House of People and one by the Council of States.

• 8 members appointed by the C.G. representing respectively;the Ministries of the C.G. dealing with :-

• -Agriculture and Rural Development• Commerce• Finance• Industry• Food• Civil Supplies• Civil Aviation• Shipping and Transport;

• 5 members appointed by the Central Govt.

• By rotation in the alphabetical order to rerpresent the States and the UT.

• 7 members appointed by the CG representing :-

• I.C.A.R.

• National Horticultural Board.

• National Agril. Coop. Mkg. Federation.

• Central Food Technological Res. Inst.

• Indian Institute of Packaging;

• Spices Export Promotion Council and

• Cashew Export Promotion Council.

• 12 members appointed by the C.G. representing :-– Fruit and Vegetables Products Industries;– Meat, Poultry & Dairy Products Industries;

• DIRECTOR : Appointed by APEDA• SECRETARY : Appointed by C.Govt.• OTHER OFFICERS AND STAFF:

– Appointed by the Authority.– The Total sanctioned staff strength is 100 in

different categories of A, B, C and D.APEDA’S PRESENCE: APEDA have its presence in all Agro

potential states of India and has been

• Providing services to agri-export community through its head office,

• 5 Regional Offices and 13 Virtual Offices.• Head office at NEW DELHI.• 5 Regional offices :• ` (i) Mumbai (ii) Kolkata• (ii) Bangalore (iii) Hyderabad, and• (v) Guwahati.

• VIRTUAL OFFICES (13):• (i) Thiruvananthapuram (Kerla)• (ii) Bhubneshwar (Orissa)• (iii) Srinagar (J&K)• (iv) Chandigarh.• (v) Imphal (Manipur)• (vi) Agartala (Tripura)• (vii) Kohima (Nagaland)

• (viii) Chennai(Tamil Nadu)• (ix) Raipur (Chattisgarh)• (x) Ahmedabad (Gujarat)• (xi) Bhopal (M.P.)• (xii) Lucknow (Uttar Pradesh)• (xiii) Panaji (Goa).• The Virtual offices have been

established in association with respective

• State Govts./agencies. Basic information about APEDA, its functions, registration and financial assistance schemes etc. is being made available to entrepreneurs/prospective exporters by these virtual offices.

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NAFED

• NATIONAL AGRICULTURAL MARKETING FEDERATION OF INDIA.– The NAFED is an Apex organisation of

Marketing Cooperatives in the country which deals in –

– 1. Procurement.– 2. Processing– 3. Distribution, and – 4. Export & Import of Selected Agril.

Commodities.

• NAFED is also the Central Nodel Agency for undertaking Price Support operations for pulses and oilseeds and market intervention operations for other Agril. Commodities.

• ESTABLISHMENT : October, 1958.

• MEMBERS : (I) N.C.D.C. (ii) State Level Marketing Federations.

• HEAD OFFICE OF “NAFED”: Delhi.

• BRANCH OFFICES: 1. Mumbai

• 2. Kolkata

• 3. Chennai

• AREA OF OPERATIONS: Whole Country

• Other branches are in all major Port Towns and Capital cities in the country.

OBJECTIVES OF ‘NAFED’

• The main objectives of NAFED are :-• A) To coordinate and promote the

marketing and Trading activities of its affiliated Cooperative Institutions.

• B) To make arrangements for the supply of the Agril. inputs (seed and Fertilizers etc.) required by Member institutions.

• C) To act as an Agent of the Govt. for

• The purchase, sale , storage and distribution of Agril. products and inputs.

• ACTIVITIES OF ‘NAFED’: (FUNCTIONS):

• (1) Internal Trade of Agril. Commodities.

• (2) Foreign Trade – Export and Import of Agricultural Commodities.

• (3) Price Support Operations.

• (4) Production & Marketing of Agril.Inputs.

• (5) Promotional activities.

• (6) Developing Cooperative Marketing of Tribal Produce.

• (7) Setting off Scientific storage system.

• (8) Processing of Fruits, Vegetables and other commodities.

• DETAILS OF FUNCTIONS OF ‘NAFED’:

• 1. INTERNAL TRADE OPERATIONS: The NAFED is engaged in inter-state trade in Agril. Commodities, particularly Foodgrains, Pulses, Oilseeds, Cotton, Jute, Fruits, Vegetables and eggs with a view to assuring better prices to the producers.

• The objectives of internal trade operations are both the market support to farmers and maintaining steady supply of commodities to consumers at reasonable prices.– NAFED purchases Agril. Commodities through

a) the Cooperatives– b) the public sector organisation,– c) the State Agencies.

• 2. FOREIGN TRADE: Export & Import of Agril. Commodities:--

• After the establishment of NAFED, the export of Agril. commodities developed on a large scale.

• (a) EXPORT: The following Agril. Commodities are exported by NAFED:-– Onions (canalised), Potatoes, Ginger, Garlic...

• ..Nigerseed, sesamum-seed, Gum, de-oiled cake of Ground-nut, Soyabean, Cotton-seed, fresh and processed fruits & Vegetables.

• SPICES: Black Pepper, Cardamom, Turmeric, Cummin-seed, coriander-seed.

• CEREALS: Rice, Barley, Bajra, Jowar, Ragi, Jute Bags.

• COUNTRIES FOR EXPORT:

• Sri Lanka, England, Mauritius, Australia, Belgium, Canada, Fiji, Hong-Kong, Japan, Malaysia, the USA and number of African, Western Asia and Gulf Countries.

• Market Intervention by NAFED:

• Many times, the NAFED have helped

• The growers of such Crops – as Onion, Potato, Copraa, Chillies and others in realising reasonale prices even in those years when market prices crashed.

• (B) IMPORTS: NAFED arranges for the imports of Pulses, Fresh fruits, Dry-Fruits, nutmeg (Jaiphal), Javitri (Mace), Wetdates and also imports of inputs (fertilizers and

• Machinery) as and when asked to do so by the Government.

• 3. PRICE SUPPORT OPERATIONS:

• NAFED is appointed as Agent of the Govt. to undertake purchases on support price, commodities like – Groundnut, Soyabean, Mustard-seed, Gram, Tur, Moong and Urad since 1976.

• Commodities like Bajra, Jowar, Barley, Sunflower seed since 1985-86.

• GOI have designated NAFED as the Nodel Agency for implementing the price support policy for Oilseeds and Coarse –grains during Seventh Five Year Plan period (1985-90).

• (d) PRODUCTION AND MAARKETING OF AGRIL. INPUTS:-

• NAFED helps farmers by supplying the Agril. Machinery like –

• - Harvesting combines,

• - Tractors,

• - Spare-parts,

• - Bio-fertilizers.

• The Technical know-how to operate and maintain the machines is also provided to the farmers by NAFFED.

• The NAFED through its service centres also sells – (i) Farm Tools

• (ii) Agril. Implements.

• (iii) Spareparts produced by Krishi Yantra Udyog, Bhiwadi (Rajasthan).

• Bio-Fertilizer (produced by Indore Unit in M.P.) since 1985 is made available to farmers for increrasing yields of Pulses and Oilseeds Crops.

• (e) PROMOTIONAL ACTIVITIES:- • NAFED maintain expert staff which

conducts maarket studies, collects data and circulates the results among the members.

• - Intensive Development of Selected Marketing Societies in each State as a Pilot Society.

• -Improvement in market intelligence services for Coop. Marketing Societies.

• - Conduct of market surveys.• - Training of Market personnels, promotion

of market regulations and dev.of infra-structures.

• (f) DEVELOPING COOPERATIVE MARKETING OF TRIBAL PRODUCE:-

• NAFED have set-up a separate Cell to develop the marketing of produce of the tribal areas (minor forest products) having economic value. NAFED develops markets for other commodities like Chilgoza, Gum, etc. A separate Tribal Cooperative Marketing Dev.federation (TRIFED) has been set up.

• (g) SETTING OF SCIENTIFIC STORAGE SYSTEM:

– Other Scheduled Products Industries;– Packaging Industries.

2 Members appointed by the CG. From amongst specialists and scientists in the fields of agril., economics and marketing of the Scheduled Products.

ADMINISTRATIVE SET-UP:-

1. CHAIRMAN -Appointed by the C.Govt.

Cotd…..

• 1.

AGRICULTURAL PROCESSING

• Important points:

• 1. Processing and Valu Addition.

• 2. Meaning of Processing

• 3. Processing Function

• 4. Technological Changes & Processing.

• 5. Food Processing.

PROCESSING AND VALUE ADDITION:

• Most of the Farm products need some kind of processing before their consumption by the ultimate consumers.

• Examples: (i) Wheat to Flour, Daliya– (ii) Moong to Moong Dal/pulses– (iii) Groundnut to Oil of Groundnut.– (iv) Mustared Seed to Mustard oil.– This processing function increases the

price spread of Agril. Commodities.

• Example : Rate of 1 kg. Wheat = Rs.12/kg.

• Rate of 1 kg. Flour = Rs.15/-/kg.

• This is called value addition and increases the price of the commodity.– The processing is an important marketing

function in the present day of marketing of Agril. Commodities. At present, consumers are dependent upon processing for most of their requirements.S

• Many Technological changes have taken place in the recent past, such as the introcution of ----

• (a) Refrigeration• (b) Modern methods of Milling and Baking

foodgrains.• (c) New processing methods for Dairy

products.• (d) Modern methods of packing &

presentation.

• Value addition in Food • in India it is 7%• In Chine it is 23%• In Phillipines it is 45%, and • In U.K. it is 188%.• MEANING OF PROCESSING: The

processing activity involves a change in the form of the commodity. This function includes all of those essentially ….

• Manufacturing activities which change the basic form of the product.– Processing converts the basic raw material

and brings the products nearer to human consumption. As soos as the change in product takes place it gets value addition in the product (in other form and shape).

• The processing of Agril. Commodities can take any of the following forms :-

• 1.FOOD PROCESSING:-

• (I) Milling of Grains : Wheat Flour, Rice milling and pulse milling.

• (ii) Manufacture of edible oils and oil-cakes from oilseeds.

• (iii) Manufacture of Hydrogenated and

• Vanaspati Oils.

• (iv) Manufacture of Sugar, Gur, Khandsari from Sugarcane.

• (v) Manufacture of Dairy Products – like Ghee, Butter, Paneer (Khoya), Milk power, Cheese and Cream from liquid Milk.

• (vi) Canning and preservation of fruits & Vegetables.

(vii)Manufacture of juices and other products from fruits and vegetables.

(viii) Slaughtering of animals and preparation of meat.

(ix) Canning and ;preservation of fish.

(x) Manufacture of Bakery and Confectionary products.

(xi) Tea processing.

(xii) Coffee curing and roasting.

(xiii) Cashewnut processing.

• (xiv) Manufacture of starch.

• (xv) Manufacture of prepared animal feed.

• 2. AGRO-RELATED PROCESSING (Other than food processing):-

• i) Processing of Tobacco leaves and manufacture of Tobacco products;

• ii) Brewing and manufacture of beverages;

• iii) Manufacture of yarn, cloth and made ups (cotton and Jute).

• iv) Leather processing and manufacture of leather and fur products.

• v) Manufacture of wood products, furniture and fixtures.

• vi) Manufacture of paper and paper products.

There are several methods of processing Agricultural Commodities. But they continually undergo a change because of ---

(i) A Change in Technology.

(ii) A Change in Capital-labour price ratio.

(iii) A change in managerial skill.

(iv) A change in the demand for product quality in the market; and

(v) A change in the volume to be processed.

ADVANTAGES OF PROCESSING:

• 1. Very few products are consumed directly in the form in which they are obtained by the producer-farmer. Therefore, Processing of Agril. products is essential. (Milk, Eggs, Fruits & Vegetables).

• 2. Processing is important, both for the producer-sellers and for consumers.

• 3. By processing, it increases the total revenue of the producer.

• 4. It is possible for the consumer to have articles in the form liked by him.– The Specific ADVANTAGES of the processing

function are :-– 1. It changes raw food and other farm

products into edible, usable and palatable forms. The value added by processing to the total value produced at the farm level varies

• From product to product. It is nearly 7% for Rice and wheat, about 79% for Cotton and 86% for Tea. It is generally higher for Commercial Crops than for Food Crops.

• Examples of the products in this group are :- (a) The processing of Sugarcane to make Sugar, gur, Khandsari;– (b) Oilseeds processing to make Oil;– (c) Grinding of foodgrains to make flour;– (d) Processing of Paddy into Rice;

• (e) Conversion of Raw Mango into pickles. -2. The processing function makes it possible

to store perishable and semi-perishable agril. commodities which otherwise would be wasted and facilitates the use of the surplus produce of one season in another season or year.

• Examples are : Drying, Canning and pickling of fruits and vegetables, Frozen foods, conversion of Milk into Butter, Ghee and Cheese and curing of meat with salting/smoking.

• -3. The processing activity generates employment. The processing industry like (a) Baking industry; (b) the canning industry; (iii) the brewing and distilling industry; (iv) the confectionary industry; (v) the Sugar industry, (vi) Oil mills and Rice mills provide employment to a large section of society.

• -4. Processing satisfies the needs of customers at a lower cost. Processing saves the time of the consumers and relieves them of the difficulties and botheration experienced in processing.

• -5. Processing serves as an adjuct to other marketing functions, such as Transportation, Storage and Merchandising.

• -6. Processing widens the market. Processed products can be taken to distant and overseas markets at a lower cost.

• VALUE ADDITION AND PROCESSING OF AAGRICULTURAL COMMODITIES: