Marketing and Prices of Agricultural Commodities: A Study on Major Vegetables in the Paschim Midnapore District of West Bengal

Abstract

This paper analyses the role of marketing structure and supply chain in the determination of agricultural prices. In general, agricultural products are not directly sold by the farmers to the final consumers. The products pass through a typical marketing channel or supply chain. Local traders or Fariahs, wholesale traders and retail traders are involved in this process. The basic hypothesis of this paper is that if greater no. of traders or middlemen are involved in the marketing process or marketing costs like distance, transportation, packaging etc. are high, the final consumers will have to pay higher prices and the farmers will get smaller share of the prices paid by the consumers. This paper has made field survey on the marketing of six vegetables in Paschim Midnapore District of West Bengal. Data have been collected from local, wholesale and retail markets. The analysis of data and regression results support our hypothesis. The results show that if price is higher in retail market, the price received by the farmer will be also high. The most important result is that if the no. of trader is high in the supply chain, the farmer will get a lower share of the consumer’ s price.