CII’s FPO Business Service Unit – Creating economies of scale for small scale farmers

Aligned to the Government priority and identifying the potential of the aggregation model, work with Farmer producer Organizations (FPOs) has been prioritized under CII’s Food and Agriculture Center of Excellence (FACE) and a Business Service Unit for FPOs has been launched. The industry led initiative aims at enhancing farmer capabilities, building scale, improving access to advanced technologies, and strengthening market linkage.

Trainings and capacity building, market linkages, access to government schemes and digitization are the key pillars of the program. We are presently working with around 20,000 farmers across 9 states and aim to scale the initiative over the next 3 years.

Aggregation and direct marketing of produce by FPOs is identified as an effective step towards managing marketable surplus, eliminating intermediaries, increasing bargaining power of farmers, reducing marketing costs, and ensuring better and remunerative prices to farmers. Aligned to the view market linkage is identified as a key pillar of the CII Business Service Unit for FPOs and under the program buy back arrangements for at least 60% of the produce is targeted. For the Rabi 2021-22 season, procurement of spices from the member FPOs was focussed upon and the target of at least 60% was achieved for majority of the FPOs with a few cases far exceeding the planned procurement.

Other key area of intervention has been training and capacity building. A series of trainings on schemes relevant to FPOs was held in partnership with Yes Bank to help the FPOs gain benefit from the relevant government schemes. Further as the FPOs went into harvesting spices virtual trainings in vernacular languages were conducted with the local KVKs on post-harvest management of the crop. As the FPOs move in to the kharif season the focus is currently on agronomic trainings focussed on sustainable crop cultivation. The crop specific, geography specific training content has been developed inhouse in consultation with industry and Agri Universities and the deployment on ground is in partnership with industry. Digital dissemination of the training content is also underway.

With focus on digitization a digital app has been developed that offers FPOs a simple ERP solution for digitally recording of all transactions to get business level insights; E-market place for Agri input and Agri output businesses as well as easily accessible Knowledge repository.

1 Comment

  1. Creating economies of scale for small scale farmers is very much important . But it has observed that FPCs which has been recently formed lacking of commodity handling experience. Additionally, they do not have rapport with member farmers. In this situation, if efforts are made to connect them with buyers, the FPCs are not confident about fulfilling the required quantity demand of the buyers. These FPCs lack experience in handling commodities beyond local vendors and markets, resulting in unsatisfactory turnover. Thus though there is supporting mechanisms which is assisting FPCs with market linkages and connecting with buyers, but most of the FPCs are not proactive in seizing the opportunity.

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