Even after the agricultural reforms of 2002-03, for wheat, rice, and pearl millet farmers in India, grain markets are still pretty sticky.
Two University of Illinois economists analyzed infrastructure of interstate trade for food-grain crops in three Indian states and found that grain farmers are unable to cash in on India's market reforms and take advantage of a price difference between two or more markets.
This is a photo of a rice field in India.
Credit: University of Illinois
"We wanted to see if there was more integration in the markets since the 2002 reforms," said Kathy Baylis. "We were surprised at how little integration we saw. Apparently there are still a lot of regulations in place. A lot of the wholesale markets are not open other than right around harvest. There is a strong incentive to sell at harvest because if you don't you'd have to travel to Delhi or another major city. The ADM Institute for the Prevention of Postharvest Loss that provided the funding for this research is interested in storage, and what we found in India is that there was a huge disincentive to invest in on-farm storage because even if farmers could store their grain for six months or so, they wouldn't be able to sell it then."
Baylis explained that, prior to the reforms of the early 2000s it was difficult in India to transport grain across state lines. The reforms made that easier and also expanded the number of people who could purchase and trade grain. Farmers used to have to go through a long, arduous process to become certified. The reforms eliminated some of those issues, but other problems still plague the system.
"Some people may think of this as only an engineering problem," Baylis said, "where we just need to develop a really good place for them to store the grain. But if there isn't an incentive to store grain to sell later and get a better price, the extra storage won't help farm income."
According to Baylis and her colleague Mindy Mallory, although India still needs some serious policy reform, small innovations could be facilitated to encourage more independent traders to get into the market.
"Anecdotally we heard that in places where there were more active traders, farmers were able to benefit from this market arbitrage potential," Baylis said. "They weren't stuck looking at their own local market. If they worked with a trader, they could keep an eye on what's happening in the city and sell their grain two or three months after harvest."
Baylis said that fruit and vegetable crops, which are highly perishable, tend to have less regulation than the grains and oilseeds.
Because they don't go through the government markets, traders are making investments to get the food from the farmer to the city.
"You have these parallel systems going on," Baylis said. "One is regulated, very structured and not very efficient. One is unregulated and in some cases works well; in other cases, it is also a mess. For vegetable crops, if farmers don't have those linkages, they really can't sell perishable products. There's a massive lack of cold storage in India, for example."
As an economist, Baylis said that she studies how policy can create headaches for farmers and on the consumer end of the supply chain.
"Global food security is often seen as a production issue, but often it's not just lack of water or access to the right seeds," she said. "There has been evidence that major famines, weren't due to a lack of food production, they occurred because you had all of these other institutional crises or economic crises.
"Some people on the outside look at the postharvest loss in India and say we need to develop a better mouse trap – to develop better storage. Our point is that although that's a good thing, if you don't have the right policy and economic incentives, the best mouse trap still won't help."
"Food Corporation of India and the Public Distribution System: Impacts on Market Integration in Wheat, Rice, and Pearl Millet," co-authored by Mindy Mallory, was published in an issue of the Journal of Agribusiness.
Debra Levey Larson | EurekAlert!
Kakao in Monokultur verträgt Trockenheit besser als Kakao in Mischsystemen
18.09.2017 | Georg-August-Universität Göttingen
Ultrasound sensors make forage harvesters more reliable
28.08.2017 | Fraunhofer-Institut für Zerstörungsfreie Prüfverfahren IZFP
Plants and algae use the enzyme Rubisco to fix carbon dioxide, removing it from the atmosphere and converting it into biomass. Algae have figured out a way to increase the efficiency of carbon fixation. They gather most of their Rubisco into a ball-shaped microcompartment called the pyrenoid, which they flood with a high local concentration of carbon dioxide. A team of scientists at Princeton University, the Carnegie Institution for Science, Stanford University and the Max Plank Institute of Biochemistry have unravelled the mysteries of how the pyrenoid is assembled. These insights can help to engineer crops that remove more carbon dioxide from the atmosphere while producing more food.
A warming planet
Our brains house extremely complex neuronal circuits, whose detailed structures are still largely unknown. This is especially true for the so-called cerebral cortex of mammals, where among other things vision, thoughts or spatial orientation are being computed. Here the rules by which nerve cells are connected to each other are only partly understood. A team of scientists around Moritz Helmstaedter at the Frankfiurt Max Planck Institute for Brain Research and Helene Schmidt (Humboldt University in Berlin) have now discovered a surprisingly precise nerve cell connectivity pattern in the part of the cerebral cortex that is responsible for orienting the individual animal or human in space.
The researchers report online in Nature (Schmidt et al., 2017. Axonal synapse sorting in medial entorhinal cortex, DOI: 10.1038/nature24005) that synapses in...
Whispering gallery mode (WGM) resonators are used to make tiny micro-lasers, sensors, switches, routers and other devices. These tiny structures rely on a...
Using ultrafast flashes of laser and x-ray radiation, scientists at the Max Planck Institute of Quantum Optics (Garching, Germany) took snapshots of the briefest electron motion inside a solid material to date. The electron motion lasted only 750 billionths of the billionth of a second before it fainted, setting a new record of human capability to capture ultrafast processes inside solids!
When x-rays shine onto solid materials or large molecules, an electron is pushed away from its original place near the nucleus of the atom, leaving a hole...
For the first time, physicists have successfully imaged spiral magnetic ordering in a multiferroic material. These materials are considered highly promising candidates for future data storage media. The researchers were able to prove their findings using unique quantum sensors that were developed at Basel University and that can analyze electromagnetic fields on the nanometer scale. The results – obtained by scientists from the University of Basel’s Department of Physics, the Swiss Nanoscience Institute, the University of Montpellier and several laboratories from University Paris-Saclay – were recently published in the journal Nature.
Multiferroics are materials that simultaneously react to electric and magnetic fields. These two properties are rarely found together, and their combined...
19.09.2017 | Event News
12.09.2017 | Event News
06.09.2017 | Event News
22.09.2017 | Medical Engineering
22.09.2017 | Physics and Astronomy
22.09.2017 | Physics and Astronomy