Small farmers in the Mailam block of Villupuram district are cultivating groundnut during both South-West and North-East monsoon seasons. However, they do not have adequate market opportunities and remunerative prices. The current market channel is producer – village trader – wholesale aggregator – millers – retailer – consumer. It is observed that the producers share in the consumers rupee reduces with an increase in the number of intermediaries.

To reduce the intermediary market players and increase the price spread index to farmers, the Nallavur Farmer Producer Company Limited (NAFPCL)[1] explored options. Recently, it discussed with a company that promotes fair trade and Global Agricultural Practices (GAP) certifications and has the potential to get premium prices.

The members of NAFPCL are adopting scientific agronomic practices for cultivation and are interested in pursuing this further. Now the board member of NAFPCL are negotiating terms and conditions, and are prepared to enter into contract farming with assured buy-back arrangements. The two certifications are an additional marketing tool for them to avail premium prices on one side, and GAP plus fair-trade practices as well as to ensure social and environmental dimensions.

As a pilot project, eight tons of groundnut has been marketed. As soon as the terms and mode of marketing are agreeable to the members, NAFPCL aims to procure 200 tons of groundnut during the Rabi season in 2022.

The Director of Agricultural Marketing and Agri Business, Chennai, Govt of Tamil Nadu, and the Deputy Director of Agri-Marketing, Villupuram, visited the seed processing unit in October 2022. The Board of Directors explained the current status and plan of the seed processing unit established with the financial support of Tamil Nadu Small Farmers Agribusiness Consortium, Chennai.

NAFPCL has been producing seeds since 2015 with black gram and groundnut as the primary seeds processed. One of the most difficult challenges in the seed business is access to the small-scale seed processing facility, space for storage and getting a breeder/foundation seeds of the preferred variety. With support, NAFPCL constructed a godown to store up to 500 tons of grains, and plans to produce 60 acres of rice, 20 acres black gram, and 20 acres groundnut seeds in the upcoming season, targeting more than 100 acres soon.

[1] NAFPCL is facilitated by M S Swaminathan Research Foundation (MSSRF)