Agricultural Marketing in Nepal

Meaning of Agriculture Marketing

Agriculture marketing is that part of marketing, which deals with production, effective distribution and exchange of agricultural goods. And it also helps in the smooth flow of agricultural goods from producers to the consumers or users. Agriculture marketing obviously can provide employment opportunities to the people of the nation supporting in the process of industrialization within the country.

Agriculture is considered as the backbone of the national economy. Agriculture sectors deal with food grains, cash crops, vegetables, dairy products, horticulture products, etc. Marketing activities are concerned with buying and selling of goods and services. So, agriculture marketing means the activity that deals with buying and selling of agriculture goods like food grains, cash crops, vegetables, dairy products, etc. Activities like production of agriculture goods, promotion, pricing, standardizing, branding, risk bearing, market research, etc. are performed under the agriculture marketing.

Generally, any institute or a person purchases agriculture products to fulfill the following objectives:

• For consumption
• For re-selling
• For industrial use

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Features of Agriculture Market

Agricultural goods are sold and purchased in agriculture market. Following are the important features of agriculture market:

• Production of goods:

Production of goods is the main feature of agriculture market. Generally, seasonal products are sold in agriculture market by traders. So, a warehousing function of agriculture market is considered as one of the essential functions. It is essential to store agro products for regular consumption and distribution.

• Distribution of product:

Another important feature of agriculture market are to distribute the product to the consumers. Since most of the agricultural goods are perishable in nature long distribution channel is not used for distributing agricultural goods in the market. Less number of intermediaries are used in distribution channel of agricultural goods.

• Price determination:

Price determination is another important feature of agriculture marketing. This market totally depends on the amount of supply of agricultural goods and degree of competition among sellers of agricultural goods. Production of agricultural goods is seasonal in nature. It is important in agriculture marketing for determining the price of the product.

• Promotion:

Promotion is also the features of agriculture marketing. It is an important tool of marketing used for increasing sales volume of any products. This tool is not widely used in the agricultural market. Promotional tools like advertising, personal selling, sales promotion, etc. are not frequently used in agriculture market.

• Nature of the product:

Agricultural products are sold according to its nature. Agricultural goods are sold in the agriculture market. Generally, agricultural goods are perishable in nature. Perishable goods are generally sold in agriculture market. Agricultural products are not equally perishable. Some products are more perishable and other are less.

• Regular demand:

Agricultural goods are regularly demanded in the market. They are generally produced in a particular season, but they are consumed regularly by the consumers. So, they are demanded regularly by the consumers.

• Inelastic demands:

Products sold in the agriculture market have inelastic demand. More agriculture goods are beneficial for the consumers . So, they are demanded regularly. There is the inelastic demand of agriculture products in the market. So, a price change of the agricultural goods does not affect the demand of such goods.

• Predominance of intermediaries:

In agricultural marketing,there is the predominance of intermediaries over agricultural products. Intermediaries of agriculture market exploit both producers and consumers. They purchase directly from producers at a low price and sell them at a high price to the consumers. Intermediaries in the agriculture market also perform pricing, standardizing grading functions.

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Problems of Agriculture Marketing in Nepal

Nepal is an agricultural country, but there exists a number of problems in this field. Neither infrastructures nor facilities have been developed for agricultural inputs and agricultural products in Nepal. Both farmers and consumers are being exploited by the intermediaries. In this way, Nepalese agriculture marketing is facing different problems.

The major problems of agriculture marketing in Nepal can be briefly shown below:

• Problem of transportation:

Poor transportation facilities is one of the major problems for agriculture marketing in Nepal. Nepal is a hilly country.There lacks efficient transportation facilities throughout the country so it is difficult to transport agricultural product and inputs from one place to another place.

• Lack of storage:

The storage problem is another problem for agriculture market in Nepal. Most of the farmers in Nepal are poor. They do not have sufficient storage capacity for agricultural products. Farmers do not get reasonable price for their production. There is no sufficient provision of cold storage facilities in Nepal. Due to lack of storage, farmers are not able to store their products for long term .

• Predominance of intermediaries:

There is the predominance of intermediaries in agriculture market in Nepal. Intermediaries purchase agricultural products from producers at a low price. The goods are sold to the customers at high prices. Intermediaries have predominance in price determination, buying and selling agricultural products.So the producers won't get the justifiable price for their products.

• Lack of promotional activities:

There is a lack of promotional activities in Nepal. Promotional activities like advertising, personal selling, sales promotion, etc. are not widely used for agriculture products. Due to lack or promotional activities in Nepalese agriculture market, consumers do not get more information about price, availability, etc. of agriculture products.

• Defective measuring equipment:

Defective measuring equipment is another problem of Nepalese agriculture market. Modern measuring equipment are not used in rural areas.They are only focusing in the traditional way of marketing of products. Traditional measuring equipment like Mana, Pathi, etc. is still widely used in rural areas of Nepal. The use of defective equipment can exploit consumers.

• Lack of technical knowledge:

Lack of technical knowledge is another problem for Nepalese agriculture market. Farmers are not getting technical knowledge about the process of marketing of the products. They are still not aware of it. Still, most of the farmers use traditional methods of production in the agricultural field.

• Lack of organized market:

Lack of organized market is also the problem of agriculture marketing. Organized markets have not developed in villages for farmers to sell their products. The farmers are not linked with their own association for the protection of their professional rights. Poverty, lack of support by government, lack of knowledge, etc. are the reasons for unorganized agriculture market in Nepal.

Prospects of Agriculture Marketing in Nepal

Nepal is an agricultural country. More than 75 % of Nepalese population is involved in the agricultural occupation. Lack of infrastructure development, knowledge, organized market, etc. are the different problems of agricultural market in Nepal. Nepal is a small country having a wide range of climatic conditions. People of Nepal are being aware of the agricultural market and its importance. All these situations show future prospects of agricultural marketing in Nepal.

Following are the important prospects of agricultural marketing in Nepal.

• Regular supply of agricultural products:

Regular supply of agriculture products helps in the development of agriculture marketing. Due to an availability of wide range of climatic condition, production of many varieties and off-season crops is possible because the main season of a hill is off season for Terai. So regular supply of offseason agricultural crops in the market is possible.

• Possibility of market expansion:

There is the possibility of expansion of the market, it helps to increase the development in the agriculture marketing. Different banks, financial institutions, co-operative and NGO’s are investing in the agricultural field for improving a quality of product and production methods. Such increasing investment helps to expand the marketing activities related to agriculture.

• Greater profit:

Greater profit is also one of the prospects of agriculture marketing in Nepal.In Nepal, farmer’s co-operatives are flourishing especially in the agricultural marketing field. Such co-operatives are supporting farmers by providing various facilities. Farmers can earn greater share of profit margin by reducing the layer of middlemen in a distribution channel.

• Increasing demand for product:

The increase in demand for agriculture products also helps in the development of agriculture marketing in Nepal. Demand for fruits and vegetables is growing within and outside the country over the years due to increase in population and increased awareness about its benefits for human beings. This shows increasing prospect of agricultural marketing.

• High export capacity:

The high export capacity of the product also helps in the development of marketing. Nepal has a great export capacity of agricultural products. Due to variation in climate varieties of products can be grown in different parts of the country. High-value crops such as fresh fruits, vegetable, vegetable seeds have a higher prospect of export to other countries.

• Increasing farmers’ motivation:

Motivating the farmers in the agriculture field also helps in the development of agriculture marketing.Growing concept of Haat bazar is likely to empower farmers in Nepal. It has improved bargain power of farmers and also increased the amount of profit from business transactions. Such increased profit motivates farmers to produce more agricultural goods.

• Price discrimination:

Determination of price also helps to develop agriculture marketing. Providing awareness to the people about the quality of an agricultural product, price discrimination is made among various products having different qualities. Nowadays people differentiate between local product and Hybrid, pesticides used products and fresh products, etc. So, it is important to determine the price according to its qualities.

References:

Koirala, Dr. Kundan Dutta. Elementary Marketing. Kathmandu: Buddha Academic Publishers and Distributors Pvt. Ltd, 2014.

Thapa, Gopal, Dipendra K. Neupane and Dilli Raj Mishra. Introduction to Marketing. Kathmandu: Asmita Books Publishers and Distributors (P) Ltd., 2014.