Linking Farmers to Global Markets Through Digital Innovations

Linking Farmers to Global Markets Through Digital Innovations

Thanks to digital technology, the days when farmers were solely dependent on middlemen for selling off their produce is gradually giving way to more efficient and transparent systems. There was a time when farmers were removed from the local markets, let alone the global market, and were heavily exploited. Their earnings were meagre and they were ill-informed about farming and business practices.

However, the scenario has changed today. Through the initiation of digital innovation and globalization in agriculture, farmers can be directly in touch with the market through the means of a digital platform. This predicament has benefited farmers, food retailers and processed food manufacturers as direct linkage has become possible. With access to regular market alerts regarding pricing, for example, a farmer can be better informed about the demands and prices of a product and can make informed decisions about it.

Linking Farmers to Global Markets Through Digital Innovations

What would happen to farmers’ produce without a vibrant market?

Indian farmers go through a lot of challenges on a daily basis to maintain a regular production system in the face of the changes in the climate, globalized domestic markets, advanced agricultural technologies, and a multitude of policies. Therefore, it will be a respite for them if an extensive market system is developed for their farming business. It will be multifaceted in the way that they will provide these farmers with information on various aspects of farming and also market access.

Without a vibrant market, the farmers will be under continuous pressure thinking about profitability, cost, sustainability, and managing the risk of crop production. They would be forced to undervalue their produce, or worse, suffer post-harvest losses without a ready market.

What are the opportunities and challenges that come along with it?

Opportunities associated with the presence of a vibrant market in an agricultural country like India is diverse. With more than 60% of the population still engaged in rural farming, a vibrant market will produce more favorable earning opportunities for them and reflect positively on the country’s GDP. Also, vast acres of land and a huge section of the population invested in agriculture can make India the top exporter in grains and vegetables.

However, to accomplish these two major benefits, several challenges need to be overcome. The principal problem that a farmer faces because of conventional wholesale markets is that of price hikes and the degradation of the quality of the product because of the continuous porter-ing of it in the various hops.

Another significant problem is the unavailability of proper storage facilities at these marketplaces, which results in the contamination of the products by flies and larvae. Yet another issue is the lack of proper temperature management which causes certain crops to rot. Rotting crops make way for bacteria and pests that promote the decaying of other crops as well.

Above all of these is the problem of time, as it takes a lot of time to transport these products to markets, and also the fuel expenses that are required for transportation. According to SourceTrace – “Despite the leading position that Indian agri-exports has earned, its total global agricultural trade accounts for a little over 2% of world agricultural trade”. The two main reasons for this are – policies which are not very helpful and are more concerned about “food security and price stabilization, and also because exports are in bulk, and comprise low-value and semi-processed items”. The other reason is the excessive use of pesticides, which often leads to the rejection of the global export of Indian products.

The middlemen and their role in dwindling profit among farmers

The policies that came into being after the Green Revolution helped many sectors like agricultural sectors and strengthened the backbone of the economy. It led to the increase in agricultural production, reduction in the import of food grains, industrial growth, increase in productivity to satisfy market demand. However, the one aspect that went completely unnoticed by these policies is the individual income of the farmers.

The most crucial one is the middleman who works between the farmers and the buyer and is involved in the whole transaction, and also the control that the trader cartels have over the business, as 70% of the farm produce that India makes is sold to the middlemen. The farmers sell their goods to these middlemen at a very low cost and these middlemen sell those products to the buyers at a much higher price..

A very crucial challenge here is to make Indian farmers understand the value of their produce. Statistics say that the money that they receive in exchange for their produce is a meager 20% of what they should earn, which makes them unable to sustain their families by just depending on farming.

The need for an innovation such as a digital platform that connects the farmers and the buyers

A digital platform should be created to connect the farmers and the buyers because it will try to make the two parties come together so that they can have a detailed interaction regarding each of their needs and requirements. It is being said after several studies that by 2050 food supply will have to be increased by 50-60%, and it will be no easy task.

So to help the farmers not face the problems that they have been facing all this time, like low value for their produce, lack of good marketing schemes for their products, there is a very urgent need for the establishment of innovation such as a digital platform. These platforms will be created keeping in mind the needs of the farmers so they can improve the quality of their life.

Linking Farmers to Global Markets Through Digital Innovations

The benefits to farmers and buyers as a result of the digital platform

There are various benefits that farmers and buyers are going to receive as a result of the digital platform like farm management and farmer advisory services which will help in the reduction of crop loss, and the farmers will also get educated about the best prices that they can receive in exchange for their products.

Market linkage helps the farmers to participate in global markets, and this helps to provide visibility to the buyers. Financial services help the two parties in having direct dealings, which is far easier and hassle-free as well. Buyers also have the opportunity to place advance orders.

SourceTrace is working to bridge the distance between the farmers and the market. It has a digital market linkage solution from its technology platform DATAGREEN that directly connects farmers and buyers. This can also be extended as a one-stop solution for supply chain management.

About SourceTrace

SourceTrace is a SaaS (Software As A Service) company that focuses on sustainable agriculture and empowerment of farmers.

SourceTrace's advanced technology platform DATAGREEN provides comprehensive solutions to manage all aspects of the agricultural value chain.

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