Re: Agri Marketing Tip #2: Price Calculation - wholesale v/s retail price - some myths
efarm Venky
> what ever the prices we have made farmers to fix it for their output, by seeing the market prevailing price the farmers can not sell it in large scale or continuously. since six months the prices are not fair for the farmers. tomatto is 20/ at the street vendar's cart. what would have been the purchases price at the land? that is the problem,ji.
sirjee,
Im sorry to say this, but your concept of retail v/s wholesale once again a common 'crib' from most farmers is SKEWED . so giving my general (a bit stinging) response.. dont take it personal..
Dear Generic Farmer :
In ANY industry, and take ANY product, there is ALWAYS diffrence between the source(factory price) and retail price .. they can NEVER be same or even comparable .
Have you ever wondered what is the factory price v/s labour salary v/s retail price for these ?
Coke/pepsi : Drink cost of flavour powder +water = Rs 50 paise, Bottle cost = Rs 3 , Retail price = Rs 20 !
Kanceepuram silk saree : Weaver salary : Rs 6000 per month , Cost of 1 silk saree : Rs 25,000
Automobile : Salary of factory worker = rs 10,000 per month , Cost of 1 car = 10 lakhs !
the street corner vendor is ALSO a poor man and hardly makes 200-300 ruppees a day .. can YOU stand in rain and sun in road side and sell YOUR vegetables .. you CANT ... And the entire chain of people who transport the produce - truck drivers, laborers, coolies, they ALL are poor as well and often never even recognised for the work they do..
and infact it is a MYTH that farmers struggle everyday in their farms and are very poor.. Most work in frm is only during planting and harvesting.. inbetween most farmers work elsewhere or in towns !!
Several farmers (especially in Tamilnadu) are roaming around in SUV's having turned real estate agents , have lavish bungalows, several 'side businesses' , and also keep taking subsidy/dole from government and still keep comparing with roadside vendor !
Farmers get water/electricty free, diesel in subsidy, seeds/fertilisers/equipments in subsidy, easy term loans from NABARD with mostly waived off in full and in COMPLETE INCOME tax free !
Most of India's income (read the tax payers money and public funds invested in banks) is BLEEDING to sustain agriculture..
and high time farmers realise instead of keep asking what MORE the country can do for you, what are YOU giving back to COUNTRY ? even the rice and dal and wheat and onions YOU are eating is being imnported from CHINA and BURMA and PAKISTAN today !! Technically you should be selling you vegetables back to us for FREE .
'vivasayee kanaku paaartha uzakku kooda minchadu' (tamil saying - if you calculate the costs of farmer, nothing will be left) saying is getting too sour.. if you want to make money, the basic thing is you should work out your finances .. else Stop cribbing ..when you cant even fix your own costs, then why do you point fingers at what somebody ELSE is getting ?
-------- Original Message --------
| Subject: | Re: Agri Marketing Tip #2: Price Calculation - calculator tools/examples |
|---|---|
| Date: | Tue, 22 Oct 2013 23:24:27 +0530 |
| From: | Raghavan Goshala <pasu.r...@gmail.com> |
| To: | efarm Venky <efarm...@gmail.com> |
| CC: | ef...@googlegroups.com |
On 22-10-2013 22:30, Raghavan Goshala wrote:
for a long time iam trying this . hope in two days i will complete this and give u a model pricing formula.thanks
Nice to see your enthusiasm Raghavan sir. We have worked this out even with illiterate farmers using just blackbaord and encouraging them to come up and write it out... and within minutes they thgemselves started completing the costing ...
see the pics atatched for working calcualtions we did with anatapur area farmers
We can assist you and your groups even over skype / web conference to walk you through the steps...
- (elakki banana )
- ground nut
- tomato
And in our efarmdirect portal , we have farmers now setting their own prices and contact buyers based on price negotiations , rather than depending on 'govt' or 'market' ... buyers too prefer dealing with them and have even advanced cash much before , becuase it avoids the last minute fluctuations in prices ... its better for everyone if farmers start calculating and setting own prices...
Also there are these web based online calculators : (bit USA centric but you can alter them for indian conditions)
- http://www.agweb.com/soybean_calculator.aspx
- http://www.nwgrapecalculators.org/
- http://www1.agric.gov.ab.ca/$Department/softdown.nsf/main?openform&type=CropReturns&page=information
On 22-10-2013 22:30, Raghavan Goshala wrote:
for a long time iam trying this . hope in two days i will complete this and give u a model pricing formula.thanks
On Tue, Oct 22, 2013 at 10:19 PM, Ramkumar R S(RSRi) <r...@rsrinnovations.com> wrote:
If any of you in the group could share an actual excel sheet (Excluding land cost and own salary) of actual cost of production for 1 or 2 sample crops, it will be helpful. (Not a hypothetical one, but an actual expenses incurred one)
Ramkumar
From: ef...@googlegroups.com [mailto:ef...@googlegroups.com] On Behalf Of efarm Venky
Sent: 22 October 2013 21:57
To: ef...@googlegroups.com
Subject: Agri Marketing Tip #2: Price Calculation - Detailed (Contnd from tip#1)
From:
Raghavan Goshala <pasu.r...@gmail.com>
if u could list what are all the heads expenses we can include, like cost of water, rent of the land, interests of other investments,cost of self/family labour ect.would be better,ji.Thanks Pasu Raghavan sir for the response... I have elaborated the expenses under diff headings for better understanding ...
- Agri Marketing Tip #2: Price Calculation - Detailed (Contnd from tip#1)
Thanks for responses from many for Tip#1 , and requests for more details on the calculation of expenses. These are some typical expenses for a 'generic' vegetable short cycle crop, starting from scratch. (and some common practices/thumb rules)
Key expense headers :
a) Land cost
For most farmers as they inherit land for 'free' from ancestors this is ZERO ! But if you were to 'lease' land today, typical rates are Rs 10,000 per acre per year.
b) Land Preparation cost
Make soil ready, flattening, making bunds etc . Usualy done by tractors/tools so rentals cost/ day
c) Fertilisers
If organic, then usualy input costs may be cheaper but compensate for manual labour required to prepare ingredients
d)Seed/Sapling costs
Farmers used to make their own seeds (from previous crop) or exchange seeds with others. But thanks to modernisation & laziness, buying seeds from shops is the norm. Also, tissue culture crops (or from nurseries) and planting as saplings is increasing chances of survival. So this costs varies with method chosen.
e)Planting costs
Labour costs for short duration (typically ladies) for 2-3 days .
Use of tools/tractors with automatic planting trays is also common now.Then add rentals
Some plants need additional support (planter boxes, frames, shade nets etc). Equate to a 'per harvest' cost .
f)Water / Electricity
Though govt does give free electricty , it often is too erratic times or low voltage to run motors. Use of diesl to run pumps incur costs. So also additional costs of bore wells/drip (but dont add ALL the fixed expense to a single harvest- these have to be spread over life of the equipments- take 10 years)
g)Weeding
Often farmers spend a LOT of labour in plucking weeds , which adds a LOT to their expenses. If proper mulching is done , can reduce the growth of weeds and also costs drastically.
h)Pest control
Pesticides - Materials costs + Labour to apply periodically is very high.
Pests/Insects are EVERYWHERE ! Whether organic or inorganic cultivation, they DO come - often RIGHT around harvest when the crop is in full bloom and ravage it ! A key insight - they often come at NIGHT when you are sleeping , so youll never know what 'ate' ur crops
Instead of synthetic chemicals/poisons , there are LOTS of organic or 'bio pest' control techniques and tools to safeguard the farms.
Also have heard from experts that plants themselves give out smells/tastes which can repel them (especially tulsi is known to be good inspect repellant)
i) Harvesting
Often manually done, and over a period. Typically vegetables require plucking every alternate day for say 2-3 weeks to a few months . Finding labour is biggest challenge. Use of harvester tools is more common in plantation crops or staple crops (sugarcane , wheat , paddy etc) but still require manpower to loading/packing
j) Storage/Loading / Transport
In most cases buyers bring their team at time of harvest to pick items at their cost. If not, farmer handles it .
Even plastic bags cost Rs 25+ today , crates Rs 300+ per piece!
Though it seems like an elaborate exercise, often this can be done with just pen and paper or a blackboard. Avoid laptops ! You will find farmers coming forward more easily if you use simple tools and even in their own mother tongue . And typically once you start doing for few, most data points will be similar .. for e.g. most horticultural crops we find the cost of production ranges between Rs 5 - Rs 8 per kg max. And more than 60% of costs is always LABOUR which is always on CASH BASIS .k) Own Salary : Most farmers NEVER add this . Based on the time/effort which is invested by farmer in his OWN land , please add what you would want to 'take home' as a salary. Most farmers are often 'confused' by this statement. So understand as - In case you DONT work in your farm and have to HIRE a manager to oversee ALL the above activities , how much would you PAY HIM ? Take that as YOUR salary ..
l) Bank EMIs : Try to equate all payments for bank loans / money lenders as a monthly debt. Calculate for the entire period of the crop cycle.
m) Misc : Any other special costs related to the crop or unique location/condition
Total COST of Production : Sum of all the expenses (from a through m )
TIP summary :Reduce labour related costs wherever possible by using better techniques/tools to reduce overall cost of production.
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Our philosophy is that you produce your food anywhere. You stay, and keep cows, take milk, produce vegetables, food grains, and chant Hare Krishna. That's all. This is our philosophy. Make your life successful. [Srila Prabhupada Conversations: May 25, 1974, Rome]
-- Venkat e: efarm...@gmail.com
Pasu Seshadri Raghavan,Founder Secretary, Eco ashram,
Aaniraicholai,29,punavasal villege. kamalapuram, needamangalam taluk,(8th km on tiruvarur-mannargudi road),& vidayal karuppur agraharam, off.kodavasal - valangaiman main road
Thiruvarur District - 610 102. Tamilnadu, India.
cell:0-944 464 6223, 0-938 274 6223,938 260 9268, 0-938 104 3648. City off:20,meettu kazhani street, adambakkam, chennai-600 088
We encourage you to please visit our Ecoashram at the following addresses:
http://picasaweb.google.com/pasu.raghavan
website id: eco-ashram.com,www.gorakshna.org., CLEAN FOOD EATERS <clean-fo...@googlegroups.com> facebook id:Seshadri Raghavan Raghavan, skype ld:pasu.raghavan1
SAB KE SAATH -SAB KAA VIKAS - NaMo.
Our philosophy is that you produce your food anywhere. You stay, and keep cows, take milk, produce vegetables, food grains, and chant Hare Krishna. That's all. This is our philosophy. Make your life successful. [Srila Prabhupada Conversations: May 25, 1974, Rome]