Marketing Practices and Distribution System of Rice in Punjab,India

Abstract

The study focuses on the marketing practices, market structures, and firms' motives for vertical co-ordination of the paddy-rice distribution system during the post green revolution period in the Punjab state of India. The study is based upon secondary data taken from several published sources and intensive interviews with the market agents in the entire distribution chain from growers to the retailers. Study highlighted the emergence of public sector as a giant player in the paddy (non-basmati) wholesale markets, unscrupulous practices for paddy/rice supplies, wide disparities in the issue prices for the below and above poverty line families, reduced off take from the public distribution system, launching of several schemes to off load excessive stocks, and improve market efficiency. Open market segment of the industry is highly fragmented wherein a large majority of the market agents have confined at the levels they can be best managed, vertical co-ordination plays a pivotal role to cope up with market imperfections and supply agents constitute a strategic link for rice sales. However, private milling gains momentum particularly during the downward phase of the industry due to increased profitability.