Prior to independence in 1947, the major concern of Government policy related to agricultural marketing was to keep the prices of food for the consumers and agro-raw materials for the industry in check. One of the landmark initiatives in the agricultural marketing scene in the country has been the recommendation of the 1928 Royal Commission on Agriculture for regulation of marketing practices and establishment of regulated markets. However not much progress could be achieved till the country got independence.
Post independence, there came a need to protect the interest of farmers and to provide them incentive prices to augment the production of agricultural commodities. During the 1960s and 1970s, most of the states enacted and enforced Agricultural Produce Markets Regulation acts. All primary wholesale assembling markets were brought under the ambit of these Acts. Agricultural Produce Marketing Committees (APMCs) main focus has been to eliminate the exploitation of the farmers by the intermediaries, where they are forced to sell their produce at extremely low prices.
However over the years, APMCs operated at the local level without facilitating inter-state mandi trade so that the farmers could sell their commodities to any buyers across the country. The electronic – National Agriculture Market (eNAM), a pan-India electronic trading portal which networks with the existing APMC mandis to create a unified national market for agricultural commodities was conceived. The main objectives of e-NAM are to promote uniformity in agriculture marketing, remove information asymmetry in the market and promote real-time price discovery.
The Prime Minister, Shri Narendra Modi, while launching the pilot of e-NAM – the e-trading platform for the National Agriculture Market on April 14, 2016 had said that the initiative will usher in transparency which will greatly benefit the farmers. While referring to the launch of e-NAM as the ‘a turning point for the agriculture community,’ Modi had said “farmers will now decide where, when, and at what price their produce will be sold and there will be no burden on consumers,” .
The e-NAM platform encourages farmers to sell their products through an online competitive and transparent price discovery mechanism and online payment facility.
Seven years since the launch of the electronic market, which digitally integrates wholesale markets, inter-state mandi trade via this facility is picking up. Also, e-NAM trade in several commodities including apples, saffron, ragi (finger millets), jeera (cumin seeds), chana (gram), soyabean, copra and silk cocoon, is gaining currency in many states.
The increase in e-NAM trade volume indicates that this platform, aimed at improving market access of farmers and creating a unified national market for agricultural produce, has reached a scale to make a meaningful difference in farmers’ income.
Inter-state trade using e-NAM platform on commodities has recently commenced with farmers from Kashmir, Maharashtra and Rajasthan selling commodities such as apples, mustard, ragi, silk cocoon, chana, soyabean and jeera, to buyers in Kerala, Odisha, Jharkhand and Madhya Pradesh, sources said.
Trading amongst various markets within the states in commodities including copra (Tamil Nadu), dry fish (Odisha), betel leaf (Odisha), soyabean (Maharashtra), jeera (Rajasthan) has risen at a steeper pace in the current fiscal.
With more farmers, traders and farmers producers organisations (FPOS) starting to use the e-NAM, the turnover of the e-NAM trade rose by 32% to Rs 74,656 crore in 2022-23 compared to 2020-21. The turnover on the platform is expected to cross Rs 1 lakh crore in the current fiscal. Still this trade on e-NAM is much less than the total trade of agricultural commodities in the country estimated at around Rs 6 lakh crore.
The e-NAM platform currently allows online trading in 209 agricultural, horticultural and other commodities notified by respective state governments.
At present, 1,361 mandis in 27 states and Union Territories are integrated with the e-NAM platform. Also, 17.5 million farmers, 2761 FPOs, 0.24 million traders and around 0.1 million commission agents are registered with e-NAM.
Experts say that over the next decade e-NAM will gradually emerge as the single most important instrument in agricultural marketing with equal participation of all the farmers, traders, processors and others in the digital platform. The digital marketing platform is likely to provide a platform to farmers in marketing of their produce through transparent price discovery mechanisms.
Sandip Das, our Consulting Editor is a veteran Food & Agri analyst with two decades experience
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