Production and Market Arrivals Pattern of Paddy in APMC Bangarpet Karnataka: A Trend Analysis

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1 Trends in Biosciences 8(9), Print : ISSN , , 2015 Production and Market Arrivals Pattern of Paddy in APMC Bangarpet Karnataka: A Trend Analysis SYED RIZWAN AHMED*, T.N. VENKATA REDDY**, MURTUZA KHAN 1 *** AND SHAIKH MOHD MOUZAM 1 Department of Agricultural Marketing, Cooperation and Business Management 1 Department of Agricultural Economics University of Agricultural Sciences, GKVK, Bangalore , Karnataka, India s: ABSTRACT Indian agriculture is said to be gambling with monsoon. Production of crops fluctuates between seasons depending on the uncertainty of monsoon and markets. The world area, production and productivity in terms of CAGR during reference period was 0.93, 3.70 and 1.80 per cent respectively. While in India it was -0.45, 0.80 and 1.10 per cent. Further in Karnataka state the CAGR was 1.19, 1.57, and 1.18 per cent and Kolar district CAGR indicates -7.10,- 9.80, -2.30,per cent respectively. Thus implies that there is negative growth rate in Kolar district (Table- 1). This instability in area, production and productivity causes fluctuation in market supply. A fluctuating supply with more or less steady demand for goods, result in wide fluctuations in prices of agricultural commodities. During the reference period to , the study analysed the area, production and productivity of paddy in Bangarpet taluk has continuously decreased at a growth rate of 0.94, 0.80, and per cent respectively. The analysis shows decreasing trend. The quantity of market arrivals of paddy in APMC Bangarpet has increased at a growth rate of 41.6 per cent in which analysis shows increasing trend. However there is less production of paddy in Karnataka as deficit state particularly Bangarpet taluk of Kolar district. If interstate movement of paddy is allowed that brings about efficiency in processing as well as competition in the market, effecting reduction in price of the paddy. There by enhances high level of consumption and demand. Key words Instability in production, Demand and Supply Rice is the main staple food for a large segment of the world population. In the last half-of 21 st century, rice yield has more than doubled in most parts of the world and even tripled in certain countries within a period of four decades, from the 1960s to the 1990s ( primarily as the result of genetic improvement. Rice production has been considered as an effective strategy for increasing global food production and safeguarding food security. According to FAO estimates the forecast of global paddy production in 2012 by about 1.5million tonnes to 730 million tonnes (487 million tonnes, milled) in the world mainly concentrated in Asian countries, Global rice consumption in is predicted to rise by 1.5 percent to 476 million tonnes, 1 million tonnes more than last anticipated. The bulk, or 85 per cent, is to be consumed as food with per capita food intake up from 56.7 kg in to 56.9 kg in takes place in Bangladesh, china, India, Cambodia, Indonesia, Laos, Myanmar (Burma), Thailand, and Vietnam. The world area, production and productivity CGAR during reference period was 0.93, 3.70 and 1.80 per cent respectively (Table 1). Thus, Rice production, consumption and trade are concentrated in Asia. One third of Asia s rice production is consumed in China and one fifth in India. India is the second largest producer and consumer of rice in the world. Rice production in India crossed the mark of 100 million MT in accounting for per cent of global production in that year. The productivity of rice has increased from 1984 kg per hectare in to 2372 kg per hectare in Major Rice exporters are Thailand, Vietnam, India, US, Burma and Pakistan. India s export of rice has fluctuated between 2.2 million tonnes to 7.2 million tonnes during the period to Since exports of non-basmati rice have been opened from September 2011, India exported record 7.2 million tonnes in FY and has

2 2184 Trends in Biosciences 8 (9), 2015 Table 1. Production and market arrivals of paddy in APMC Bangarpet Sl. No. Years Area(ha) Production (tonnes) Yield(kg) Market Arrivals (Qtls) * Growth rate * R * * Correlation Source: Karnataka State Department of Agriculture marketing and already exported 7.5 million tonnes in Apr-Dec, As per FAO, India emerged as the world s largest exporter of rice in calendar year Some of the top major rice importing countries are Indonesia, Iran, Iraq, Malaysia, Nigeria, Philippines, and Saudi Arabia etc. According to FAO, Iran is the top buyer of India rice and basmati rice sales to the country have almost doubled during the first two quarters of FY India s basmati rice exports to Iran between April-September 2013 stood at around 8,51,859 tonnes, up about 77 per cent compared to around 4,81,328 tonnes exported during the same period in India has largest share of million hectares in the world paddy area, India ranks second in production next only to china. Paddy accounts for 36.8 per cent of the cultivated area and about 40 per cent of the total food grain production in the country. While in India CGAR of area production and productivity was -0.45, 0.80 and 1.10 per cent respectively. It continues to play vital role in the national food grain supply. It is the staple food of nearly half of the world population. It ranks third after wheat and maize in terms of worldwide production. Some of the major paddy growing states in India are Andhra Pradesh, West Bengal Uttar Pradesh Punjab, Bihar, Tamil nadu, Karnataka and Kerala etc. Over 78 million tones of paddy are grown in India every year. It is well known fact that the Indian agriculture is characterized by wide variation in output of major crops which subsequently leads to wider fluctuations in market arrivals. The extent of fluctuations in market arrivals largely contribute to the price instability of agricultural commodities. In Karnataka state the CGAR of area production and productivity was 1.19, 1.57, and 1.18 per cent respectively. While Kolar district indicates CGAR of area production and productivity -7.10,-9.80,-2.30, thus implies that there is negative growth rate in Kolar district (Table 1). As per the modified APMC Act Deregulation of paddy marketing system in APMC brings about efficiency and competitive linkages between farm production and retail chains. As on 31 st march 2008, there are 498 APMC s are present in the Karnataka state. Most of APMC s in Karnataka state have market yards where traders and other market functionaries are for handling of agriculture produce from farmers. Farmers can sell their produce to traders

3 AHMED et al., Production and Market Arrivals Pattern of Paddy in APMC Bangarpet Karnataka 2185 Table 2. India s Rice Production in Global Context Year World Production in million (MT) Indian Production in (MT) India s share (In %) Source : FAO 2012 under supervision of APMC s. Farmers cannot sell produce outside the APMC mechanism. During the study period there were 24 rice mills operating in the Bangarpet taluk, which is nearer to A.P and T.N states paddy production areas. Thus facilitates movement of paddy for processing in the taluk. The CGAR of area production and productivity was 0.94, 0.80, and per cent respectively. Further decrease in production of paddy and increase in the market arrivals to the APMC (Table-2) brings about efficiency in processing and increased competition for marketing of rice.(fig-1&2) MATERIALS AND METHODS The Bangarpet taluk was purposively selected because the highest arrivals of paddy were reported in APMC Bangarpet among the APMC s in Kolar district. Further area, production and productivity under paddy is continuously decreasing in Kolar district. To examine the production and market arrivals pattern of paddy in APMC Bangarpet. The data on area, production and productivity of paddy was collected from FAO, INDIASTAT, and the Karnataka State Department of Agricultural Marketing ( to ). The information on market arrivals were collected from the websites of Directorate of Economics and Statistics GOK, and Krishimaratavahini as well as records maintained in APMC office. The analysis of data was further done using the following tool: Time series analysis Trend analysis For analysis of time series data, a model is essential. Generally, two broad approaches are resorted too. One is a multiplicative model and the other is an additive model. There could be other approaches too resulting in a hybrid model of these two. In this present study, multiplicative model has been employed, since many of agriculture data admit such a model as a more appropriate one. Let the original observation at the time point to be denoted by Yt and the four components viz., trend, seasonal, cyclical and irregular variations by Tt, St, Ct and It, respectively, for a time period t (where, t =1, 2, 3 ).Then the multiplicative model can be expressed as; Yt = Tt x St x Ct x It, t = 0, 1, 2 In the present study only trend analysis were computed to study the behavior of production and market arrivals of paddy. To long run trend in production and pattern of market arrivals of paddy were analyzed by fitting linear regression model of the type Y= a+ bx Y= arrivals /price over a period of time a= intercept b=slope x=time

4 2186 Trends in Biosciences 8 (9), 2015 Table 3. Production of Rice in major Rice Producing Countries. Countries 2008/ / / / /13Jan 2012/13Feb Bangladesh Brazil Burma Cambodia China Egypt India Indonesia Japan Korea South Nepal Pakistan Philippines Thailand Vietnam Others United States World Total Source: USDA (Qty in thousand MT) RESULTS AND DISCUSSION Trend analysis was attempted in order to study the pattern of variation in the production and market arrivals in APMC Bangarpet. The yearly production and market arrivals of paddy for the period to were used for this purpose. The details are indicated in the Table 1. The results of the analysis are presented as under. The results of the trend analysis in production and market arrivals of paddy in APMC Bangarpet is presented in Fig.3 & 4. It is evident from fig.3 that during the reference period, the production of Source: faostat.fao.org Fig 1: Leading Top ten rice producing countries in the world

5 AHMED et al., Production and Market Arrivals Pattern of Paddy in APMC Bangarpet Karnataka 2187 Fig 2. Top 10 leading Rice producing states in India. paddy in Kolar district particularly Bangarpet taluk over the period has drastically reduced at a growth rate of 0.80% (6,876 to 3,607 tonnes) in which trend analysis shows decreasing trend. Because decrease in rainfall in the area and also the non availability of water in tanks and bore wells where tanks and bore well are the major source of irrigation requirement for cultivation of paddy in the Bangarpet taluk of Kolar district. The quantity of market arrivals of paddy in APMC Bangarpet has increased at a growth rate of 41.6% (4,539 to 4,77,602 Qtls) in which trend analysis shows increasing trend. The purchasing of paddy by paddy processing units in Bangarpet Fig. 3. Trend in production of paddy in Bangarpet taluk of Kolar district

6 2188 Trends in Biosciences 8 (9), 2015 Table 4. Area, Production and Yield of Rice for the year and (Area - Million Hectares Production - Million Tonnes Yield - Kg./Hectare) State Area Production Yield Area Production Yield West Bengal Uttar Pradesh Andhra Pradesh Punjab Bihar Tarnil Nadu Chhattisgarh Odisha Karnataka Assam Haryana Jharkhand Maharashtra Madhya Pradesh Gujarat Kerala Others All India Source : Directorate of Economics and Statistics (2012) was done in the market yard.however the market arrivals has increased because of arrivals of paddy from outside the market area particularly from the major paddy growing belts of Karnataka like Cauvery command area and Tungabhadra command area. Thus, it may be the reason behind for increase in the market arrivals of paddy in market yard inspite of decrease in the area under production of paddy. The study has revealed that the production of paddy in Bangarpet taluk has continuously decreased at a growth rate of 0.80% (6,876 to 3,607 tonnes) Fig.4. Trend in market arrivals of paddy in APMC Bangarpet of Kolar district

7 AHMED et al., Production and Market Arrivals Pattern of Paddy in APMC Bangarpet Karnataka 2189 Table 5. Area, production and yield of Rice in Karnataka ( to ) Year Area ( ' 000 Hect.) Production ( ' 000 Tonne,) Yield (Kg./Hect.)

8 2190 Trends in Biosciences 8 (9), 2015 Year Area ( ' 000 Hect.) Production ( ' 000 Tonne,) Yield (Kg./Hect.) * Source: Department of Agriculture, Govt. of Karnataka in which trend analysis shows decreasing trend. The quantity of market arrivals of paddy in APMC Bangarpet has increased at a growth rate of 41.6% (4,539 to 4,77,602 Qtls) in which trend analysis shows increasing trend. Based on these results there is less production of paddy in Karnataka as deficit state particularly Bangarpet taluk of Kolar district. The Government should allow interstate movement of paddy that brings about efficiency in processing as well as competition in the market reduction in price of the commodity. Their by enhancing high level of consumption and demand. Policy Implication 1. Deregulation of APMC amended according to WTO rules and regulation for protecting producers and consumers. 2. Essential commodity act 1955 for liberalization of interstate movement of paddy protecting both processors and traders 3. Food security act 2013 for protecting the consumers. Thus consumption of rice in Karnataka over the years is increasing with the prices of essential commodities skyrocketing in recent years, dependence on public distribution system (PDS) for essential commodities, particularly rice, has gone up in Karnataka, The consumption from PDS in and showed a considerable rise, particularly for rice. Obviously, as prices escalated, people purchased items from PDS shops, which sell at subsidised rates. The PDS share in total rice consumption in was about 23.5 per cent in the rural sector and about 18 per cent in the urban areas, a sharp increase from 13.2 per cent in Total 6. Area, production and yield of paddy Kolar district Sl. No Year Area Production Productivity Source : Department of Agriculture, Kolar district

9 AHMED et al., Production and Market Arrivals Pattern of Paddy in APMC Bangarpet Karnataka 2191 the rural sector and 11.3 per cent in the urban during Thus these laws helps in higher movement of paddy from surplus state to deficit state bring about processing as large number of rice mills are located in Bangarpet.Finally rice is made available for consumption to people in Karnataka. LITERATURE CITED Agarwal, N. L. and Dhaka, J. M., 1998, Relationship between arrivals and prices of spice crops in Rajasthan. Indian Journal of Agricultural Marketing, 12(3): Ausepharamphil Joson Jose., 2002, Infrastructure policies for price stabilization of potato in Karnataka Ph. D.Thesis University of Agricultural Sciences., Dharwad. Dayakar Rao, B., Bharath Kumar, K. A. and Binu Marthew, 2003, Trends in Production, Prices and Market arrivals of sorghum v/s competing crops A critical analysis. Indian Journal of Agricultural Marketing, 17(1): Mali, B., Natadkar, D. S., Sale, D. L. and Pagire, B. V., 1999, Trends in arrivals and prices of fruit vegetables in Pune regulated market of Maharashtra. Indian Journal of Agricultural Marketing, 13(2): 32. Mundinamani, S. M., Ranganatha Sastry, K. N. and Basavaraja, H., 1999, Trends and seasonality in market arrivals and prices of groundnut in Karnataka. Indian Journal of Agricultural Marketing, 13(1): Pagire, B. V., 1998, Arrivals and price analysis of grapes in Maharashtra. Indian Journal of Agricultural Marketing, 10(3): Ravikumar, K. N., Sreelakshmi, K. and Raju, V. T., 2001, Trends in arrivals and prices of selected commodities in Anakapalle regulated market. Journal of Institute of Economic Research, 23: Syed Rizwan Ahmed., 2014, A study on marketing of paddy in APMC Bangarpet of Karnataka state, M.Sc.Thesis, (Unpublished) University of Agricultural Sciences., Bangalore. Upendra, M. and S.M Chary, 1996, An analysis of market arrivals and prices of paddy in Regulated Agricultural Markets. The Bihar Journal of Agricultural Marketing, 11 (1): Received on Accepted on

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