Efficient transport and marketing are critical components of the agriculture value chain. However, gaps in logistics and markets hinder farmers’ ability to access markets, realise fair prices, and reduce post-harvest losses.
Main Constraints in Transport of Agricultural Produce
FCI transit loss stands at Rs 300 crore/annum
Poor Rural Road Connectivity– About 25% rural habitations lack pucca road connectivity .
Lack of Multi-Model connectivity – heavy dependence on roads for transport
Inadequate First-Mile Logistics – Scarcity of tractors, mini-trucks, and affordable transport
High Post-Harvest Losses in Transit due to improper packaging, rough handling, and delays. 6-18% losses in fruits & vegetables (NABARD/FAO).
Cold storage capacity in India can only accommodate about 11% of the country’s total produce.
Fragmented Landholdings – 86% farmers are small/marginal – increase per-unit transport cost
High Logistics Cost of 14% of GDP – raise farm-to-market cost.
Main Constraints in Marketing of Agricultural Produce
63% of agricultural households sold their crops to local markets and only 7.2% sold to APMCs.
Dominance of Intermediaries leads to low price realisation. Eg- Farmers get only 25-30% of final price in perishables.
Inadequate Market Infrastructure – Mandis lack grading, sorting, storage, and drying yards. Only 10% of mandis meet required norms (Dalwai Committee).
APMC operating in monopolised silos limit free inter-state movement and competition.
Poor Access to real-time price and demand Information – weakens bargaining power of farmers
Low Digital Integration – Only about 1500 mandis integrated with e-NAM (2024).
Quality & SPS Compliance Gaps – Inadequate testing infrastructure impacts domestic sales and exports. Eg- EU rejecting Mango consignment
Way Forward
Strengthening FPOs to enhance collective bargaining and direct market access for farmers. Eg- Sahyadri FPO in Maharashtra – increased incomes by 30%
Cold-Chain-as-a-Service (CCaaS) – IoT-based cold storage + logistics integration reduces post-harvest losses
MSP 2.0 based on 3 D’s – Decentralisation, Diversification and Digital Procurement. Eg- instant payments through e-RUPI.
Rural Agri-Logistics Nodes under Gati Shakti Framework to develop cold chains, aggregation centers, and packhouses near farm gates.
Strengthening supply chain management is key to ‘Doubling Farmers Income’.