Agricultural produce market committee

An agricultural produce market committee is a marketing board established by state governments of India.

Why APMC?

APMC acts run on two principles: Ensure that intermediaries (and money lenders) do not compel farmers to sell their produce at the farm gate extremely low price so that farmers are not exploited. All food produce should first be brought to the market yard and then be sold through auction

Salient Features

Under APMC Acts:

A State is geographically divided and Market (Mandis) are established at different places within the states. Farmers have to sell their produce through the auction in mandi. To operate in Mandi, a trader has to get license. Wholesale, retail traders (e.g. shopping mall owner) or food processing company etc cannot buy farm output directly from farmer. They’ve to get it through the Mandi.

Karnataka

The state government of Karnataka, in order to facilitate farmers to sell their produce and get reasonable prices, created APMCs in many towns. Most of the APMC have market where traders and other marketing agents are provided stalls and shops for purchase of agriculture produce from farmers. Farmers can sell their produce to agents or traders under supervision of APMC.

Farmers cannot sell produce outside the APMC mechanism. However now govt. is encouraging direct selling through 'Rautu Bazar' or to super markets directly. The present system of APMC makes farmers vulnerable to traders' and marketing agents' price manipulations. The Government of India is considering improving the APMC Act to benefit all parties involved. It is a platform for farmers to sell their produce.

Maharashtra

The Maharashtra State Agricultural Marketing Board runs 295 APMCs in Maharashtra. It runs on the APMC Act made by Government of India.

Tamil Nadu

In Tamil Nadu, Tamil Nadu State Agricultural Marketing Board (TNSAMB) is the Agricultural Market regulatory Board

Issues

There are many problems faced by farmers due to the restrictions imposed by APMC Act. Even after receiving the fruit/veggies/grains, they delay payment to farmers for weeks and months. If payment is done on spot, then trader would arbitrarily deduct some amount, on excuse that he has not received payments from the other parties. To avoid tax/cess, the traders don’t give sale slips to farmers. As a result, later it is difficult for farmer to prove his ‘income’ to get loans from banks. on an average basis the farmer is able to receive barely 1/4th to 1/3rd of the final retail prices Middlemen get double commission (both from seller and buyer) thus makes consumer to pay for this spread. Also middlemen do not pass the benefit to either side during peak season, when they buy from farmer at low prices, they don’t drastically reduce the prices to final consumer. during lean season, when consumers prices are high, the farmers do not get higher returns on their produce.