What crimps action at Nizamabad mandi

The turmeric assaying process takes a long time, so buyers end up physically examining the stock

While launching the electronic national agriculture market (eNAM), Prime Minister Narendra Modi envisioned it as a portal to connect all existing Agricultural Produce Market Committees (APMCs) and create a unified national market for agriculture commodities.

Over a year down the line, how much of the action plan is operational on the ground?

Currently, none of the 400-plus mandis under eNAM has enabled inter-State trade. Also, not many permit even inter-mandi trade. Infrastructure for sorting and grading the produce is also not in place.

To get a first-hand feel of the action, this writer visited Nizamabad mandi in Telangana, which recently won an award from the Prime Minister for best eNAM mandi. The market yard has 49,975 farmers, 436 purchasers, 113 commission agents registered under eNAM with a total of 30 commodities, including paddy, maize, turmeric, soyabean and pulses traded on the platform. Is this mandi a fully-functional model that APMCs of other States can follow?

Not in entirety. There is a lot of work yet to be done at the Nizamabad market yard, going by this writer’s experience.

A typical day

This is how action begins unfolding at the mandi. At the gate, when the farmer/commission agent brings the produce, lot IDs are issued. This ID captures the farmer’s name, his contact number, the crop, the place from where it has been brought, and the number of bags of the produce he has brought to the mandi.

After receiving the lot ID at the in-gate, the farmer takes his produce to the shed on the floor of the yard and displays the lot ID on the heap.

The Nizamabad mandi has an assaying laboratory which is run by the National Collateral Management Services Ltd (NCML). The staff here are trained by NCML to use various equipment and test the quality of the produce. Moisture meter, UV-visible digital spectrophotometer, digital balance, digital hot air oven and serological water bath are some of the equipment with the AMPC.

After the staff test the sample provided by the farmer, the results are entered into the eNAM platform with the lot IDs by the staff. Simultaneously, a print of the details is also issued to the farmer to display it on his produce kept in the sheds. (For turmeric, as the testing process takes 5-6 hours, most farmers do not go for it. Traders who buy turmeric do a physical examination before they buy).

Traders who walk through the sheds note down the lot IDs of the produce they like to buy. They get to know the quality specification if it has already been assayed, else they examine the stock.

Of the 436 purchasers registered under eNAM in the mandi, 30 buy only turmeric and all of them do a physical examination to gauge the moisture content and see if there is any pest attack. Once traders note down the lot IDs they want to bid for, they go back to their shops and log into the eNAM platform.

As the auction opens, they place their bid. After the auction ends, the system by itself releases the winners’ list. This gets displayed on the electronic display boards in different places inside the market yard and is also visible to traders from their terminal.

The commission agents convey the information — which trader has bought his produce and for what price — to the farmer. Farmers get an hour’s time to make up their mind on accepting/rejecting the rate offered.

If the farmer accepts the rate offered, the purchaser brings gunny bags to the shed and weighs the produce. There are licensed weighmen at the market yard. The weighmen have POS machines which are paired with the electronic weighing machines through Bluetooth.

So, once the produce is weighed, the results go directly to the eNAM portal. After this, the purchaser makes the payment directly to the farmer through cash/RTGS or can also pay online through the eNAM platform.

However, if the farmer is not happy with the price, he can reject the offer. In that case, the same lot will enter the bidding process the next day. The produce is kept under the shed and commission agent takes the responsibility for it till it is sold.

Checks trade cartels

This writer spoke to 15 farmers from Munapally village in Telangana who have traded on Nizamabad’s eNAM platform. They all acknowledge that the system has become more transparent with eNAM.

G Rajendra, who has a five-acre plot on which he sows turmeric and jowar, says, “Earlier I never knew the actual price and traders used to collude and push prices down. But now, after the online bidding, I am getting a better price…”

The one problem many farmers highlighted was the delay in payment — if it is processed online through the eNAM portal.

If it is cheque/RTGS, the money is received in two days. But if it is done online through the eNAM portal, it takes longer, at times. The delay, officials say, is because many a time the name the farmer gives at the in-gate when entering the mandi and his bank account name do not match. The problem is also because of mistakes in account number or other details provided.

What is missing?

The key missing link to make eNAM successful at Nizamabad is sorting and assaying facility. There is no sorting facility at the mandi for any crop. For turmeric, for instance, there is need for an aspirator (to remove lightweight powders and straw), grader (to segregate turmeric size-wise), and a gravity separator (basically a de-stoner to remove stones). But this infrastructure facility is not available.

Also, quality assaying for turmeric is done using a conventional process (by wet chemistry) which takes a minimum of six hours for a sample to be tested. So, turmeric is not assayed, and traders only physically examine the stock.

State governments need to understand that if eNAM has to be successful it has to draw traders from across the country and let them buy the produce at their location. And for this to happen, standardising the goods is essential.

Standardising agri commodities is difficult but not impossible. The Ulavar Producer Company in Erode has successfully experimented with a new process to get complete analysis report for turmeric in less than five minutes.

Venkateshwaran (CD Kumar), Vice-Chairman of the company, says, “We are able to save time because we use the spectrophotometer and do not do a wet chemistry study for every sample…”

States should also be quick in bringing amendments to the APMC Act to allow inter-State trade.

Only when more competition comes in will the market open up and the farmer will get the best deal.

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