Livestock Economics, Marketing and Business Management

PROBLEMS IN LIVESTOCK AND LIVESTOCK PRODUCT MARKETING

Lack of producer's organization

• The farming community is more or less disorganized at the village level.
• Except for a few, till now no such organization has developed which may prove a sound basis for strengthening the bargaining power of the farmers.
• An individual deals in his own product, he sells his surplus produce in the village or at the primary market level with his low bargaining power and hence, he is always at a disadvantage against the organized trading community.

Forced sale

• In a country like India, majority of subsistence producers are compelled to sell their produce immediately after harvest in order to meet the pressing claims of their lenders even if the prices are not remunerative.
• Most producers sell their product, repay debts, face a shortage, and fall in debt again. Thus they sell to repay debt only to fall in debt again.

Superfluous middlemen

• Since the farmer sells a substantial portion of his surplus produce in the village and nearby markets, there is always intervention of a number of middlemen between him and the consumer and naturally share of the consumer's price received by the producer is reduced.

Malpractices in the market

• Malpractice arises on account of multiplicity of market charges, spurious deductions, unfair weighment and undesirable mode of sale.
• Weight and scales are manipulated against the seller.
• There are all kinds of arbitrary deductions for religious and charitable purpose.
• The burden falls entirely on the seller and he has no effective means to protect himself against such practices.
• Some quantity is taken away from the producer's produce as sample.
• This varies from produce to produce. The producers are not paid for this even when no sales are effected.

Absence of grading and standardization and inadequate storage facilities

• Many state governments have not so far prescribed grades and standards for many livestock products.
• A good number of farmers have little knowledge of grading their produce and usually mix up good and bad quality product into a single lot which secures them a lower price for their produce in the market.
• There is general inadequacy of good storage facilities both in urban as well as in rural areas.
• The indigenous methods of storage adopted in village do not adequately protect the produce.
• As a result, physical losses go on increasing if the period of storage is lengthened.

Undeveloped modes of transportation

• Without a good transporting system, no individual will have the incentive to produce or to purchase more than minimum.
• Unless it is reasonably convenient for the farmer to exchange his surplus produce for consumer goods or farm production requisites, he is lacking an important incentive to exploit the full potentials of his animals.
• Lack of an efficient transport network is the real limiting factor in the attempts to increase livestock production in our Country.

Variability in Output

• The quantity of farm products available depends upon several factors.
• With the gambling nature, one cannot forecast the quantity of products that would be produced as livestock production is mainly biological depending on weather, rainfall etc for its main inputs like feed, fodder etc.,

Seasonality in production

• Much of farm production is highly seasonal. The production varies from one season of the year to another.
• Hence, storage facilities must be made ready to hold the product until it is consumed.
• This seasonality in production thus, raises costs of marketing through demand storage facilities.
• The seasonal variability in production of items like milk, egg, butter etc is not as acute as it used to be a few years ago.
• The widespread use of rapid transportation and refrigeration has tendered to reduce the seasonality.

Raw materials

• Farm out put which mainly sold in the farm of raw materials is used subsequently for processing.
• Sugarcane is to be converted into sugar, oils seeds into oil, animals in to meat, wool in to cloth before all these are used for consumption.
• Hence the raw materials produced by the farmers are to be processed at once stage or the other before final consumption.

Perishability

• In relation to other products, agricultural products by nature are perishable. All products ultimately deteriorated.
• Eggs, mutton, and milk must move into the place of consumption very quickly, otherwise they would completely lose their value.
• These perishable products require speedy handling and often-special refrigeration, which raises the cost of marketing.

Others

• The differences in variety, colour, palatability, nutritive value, size, quality etc. of the products are the other determinants of a good market for these products.