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Pt3 Agricultural Marketing

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Danbert Abot
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20 views3 pages

Pt3 Agricultural Marketing

Uploaded by

Danbert Abot
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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AGRICULTURAL MARKETING

Agriculture – growing of crops or livestock


Marketing – series of actions or events involved in the movement of goods from farmers to consumers
Together, agricultural marketing is:
-Human activity directed at satisfying the needs and wants through exchange process (Philip
Kotler)
-Performance of business activities that directs the flow of goods and services from producers to
users (American Marketing Association)
-Process which starts with a decision to produce a saleable farm commodity, involves all the
aspects of market structure or system, both financial and institutional, based on technical and economic
considerations, and includes pre- and post-harvest operations, assembling, grading, storage,
transportation and distribution (National Commission on Agriculture1976)

Agricultural marketing system


-Link between farm and non-farm sectors
-Bring about overall welfare to all segments (producers to consumers)
-OVERALL OBJECTIVE: in developing countries is to help farmers get the right prices for their produce
and ensure availability of supply of produce in the market (right type, right place, right time, right quantity
and quality, right prices)

STAGES OF AGRICULTURAL MARKETING


Assembly – buyers of specific agricultural produce
Transportation – truckers, railroads, airlines
Storage – grain elevators, cold storage warehouse, heated warehouse
Grading and classification – commodity merchants or government graders
Processing – food and fiber processing plants (flour mills, fruit canning)
Packaging – tin can makers, cardboard box makers, bottle makers
Distribution and retailing – independent wholesalers

IMPORTANCE OF AGRICULTURAL MARKETING

1. Optimization of resource use and output management


-Efficient marketing required
-Reduces losses in processing, storage, and transportation, leading to a higher marketable surplus
-Facilitates faster growth in the agricultural sector by distributing modern inputs effectively

2. Increase in farm income


-Enhances farmers' income by reducing middlemen and marketing costs.
-Mitigates malpractices in the marketing of farm products.
-Ensures better prices for farmers, encouraging investment in modern inputs.
-Leads to increased productivity, production, and marketed surplus.

3. Widening of markets
-An efficient marketing system extends product reach remote areas, locally and internationally.
-This expansion boosts demand, ensuring a steady and higher income for producers.

4.Growth of agro-based industries


-Efficient agricultural marketing supports the growth of agro-based industries.
-Industries like cotton, sugar, edible oils, and food processing rely on agriculture for raw materials.
-This synergy stimulates the overall economic development process.

5. Price signals
-An efficient marketing system provides farmers with vital price signals.
-These signals enable farmers to align their production with the economy's needs.

6. Adoption and spread of new technology


-The marketing system facilitates farmers' adoption of new scientific and technical knowledge.
-Investment in new technology hinges on the assurance of market clearance at profitable prices.

7. Employment creation
-The marketing system generates significant employment opportunities for various roles.
-This includes packaging, transportation, storage, and processing activities.
-Directly employed individuals encompass commission agents, brokers, traders, retailers, weighmen,
packagers, and regulating staff.
- The system also indirectly supports employment through the supply of goods and services.

8. Addition to national income


-Marketing activities add value to the product thereby increasing the nation's gross national product and
net national product.

9. Better living
-An efficient marketing system is crucial for the success of development programs.
-It plays a vital role in reducing poverty, lowering consumer food prices, earning foreign exchange, and
eliminating economic waste.
-Development plans targeting the well-being of the agricultural population should prioritize the
development of an efficient food and agricultural product marketing system.

10. Creation of utility


-Marketing is integral to the production process, ensuring products reach consumers in the right form
and time.
-Although it adds costs, marketing also creates utilities in products.

FOUR TYPE OF UTILITIES ARE PRODUCED THROUGH MARKETING:


Form utility – processing changes form of commodity, adding value
Place utility – transportation shifts commodities from places with plenty of it to places lacking supply
Time utility – storage helps in ensuring availability of products in the times of need
Possession utility – buying and selling transfers ownership of one product from producer to consumer

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