Chapter.3

Agri. Marketing

1. Ag. Marketing & Economic Development A.S.M. Fazlul Hoque Assistant Professor , Dept. of Agribusiness & Marketing. Sher-e Bangla Agricultural University. 1

2. Importance of Agricultural Marketing Optimization of resource use and output management Increase farm income Widening market Growth of agro-based industries Price signal Adoption and spread of new technology Employment creation Addition national income Better living Creation of utility 2

3. History of Ag. Marketing Development Specialization Urbanization Transportation& communication Technological change in agriculture(HYV, Inputs, Techniques) 3

4. Producer surplus Quantity made available to the non-producing population of the country. Covering Areas 1.Farming sound price policies 2.Developing proper procurement and purchase strategies 3.Checking undue price fluctuations 4.Export & Import decision 5.Development of transport and storage systems. 4

5. Producer Surplus Marketable surplus : It is the quantity of produce which can be made available to the non – farm population of the country. MS = P-C Where, MS = Marketable surplus P= Total Production C= Total Requirement( family consumption, farm need, payment to labor, artisans, landlord and payment for social and religious work) 5

6. Producer Surplus Marketed Surplus : Marketed surplus is that quantity of the produce which producer-farmers actually sell in the market irrespective of their requirements for family consumption, farm needs and others payment. Relationship Marketed surplus<Marketable surplus( large farmers ,storage capacity , substitute products) Marketed surplus>Marketable surplus( small, marginal farmers, distress sale) Marketed surplus=Marketable surplus ( perishable commodities, average farmers ) 6

7. Factors affecting Marketable Surplus Size of Holding Production Price of commodity Size of family Requirement of Seed& feed Nature of commodity Consumption Habits 7

8. Functional Relationship Between Marketed surplus & its Factors M = f(X 1 , X 2, X 3, X4 ……………….. Xn ) Where, M= Total marketed surplus X1 = Size of holding X2 =Size of family unit X3 = Total production of the crop X4 = Price of the crop 8

9. Pattern of disposal of marketed surplus 1. Place of sale( village sale, market sale) 2.Time of sale 9

10. Characteristics of good market Consumer focused need & want Variety of products or services No harmful products & consumer protection Information available No pressure on consumer to purchase Retailing service Fair & uniform price Absent from inefficiency or wastage in the market Producers should be able to sell their surplus quickly at proper price 10

11. Ideal Marketing system The ideal marketing system is one that maximizes the long run welfare of society. It should operate with maximum physical and allocative efficiency . Pricing efficient Price variation based on transportation cost ( between location) Price variation based on storage cost(between season) Price variation based on processing cost (between form) 11

12. Characteristics of a good Marketing System Free from govt. interference in free market transaction Independent but systematic Contributes to rapid development of the urban- industrial economy Demand & supply equilibrium Employment generation 12

13. Scientific Marketing of farm product Bring the produce for sale after cleaning Sell different qualities of products separately Sell product after grading Keep abreast of market information Carry bags/ packs of standard weighs Avoid immediate post harvest sale Patronize co-operative marketing societies Sell the produce in regulated markets Choose the right varieties Minimize chemical residues 13