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Chapter: 11th 12th std standard Indian Economy Economic status Higher secondary school College

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Importance of agricultural marketing

Agricultural marketing means the economic process under which agricultural goods are exchanged. Process of agricultural marketing determines the value of agriculture products in terms of money and delivers them to their final consumer.

Agricultural marketing
 
Agricultural marketing means the economic process under which agricultural goods are exchanged. Process of agricultural marketing determines the value of agriculture products in terms of money and delivers them to their final consumer.
 
 
 
Importance of agricultural marketing
 
Agricultural marketing is a specific part of marketing. It is related to agricultural products only. It is the base of most of the economic activities of a country. It brings marketable surplus to the market for sale. Farmers will keep a portion of their produce for self-consumption and cattle and the remaining portions are left for sale. Higher level of marketable surplus leads to greater economic development. The importance of agricultural marketing is as follows:
 
Provides raw materials for industries.
 
Provides foodgrains for the entire population and fodder for cattle.
 
Provides a base for expansion of internal market of a country.
 
Helps in the expansion of international market also when marketable surplus found in excess of the demand of a country, fetches a considerable amount of foreign exchange.
 
At present, most of the farmers sell their produce through village level markets, fairs, mandies; co-operative societies and government also purchases agricultural produce direct from farmers.

Marketable Surplus

 
Marketable surplus may be defined as the residual of produce left with the producer after meeting his requirements for family consumption, farm needs etc. It also means the portion of produce left for sale. Marketable surplus, which is genuine and not artificial or forced, is the fountain source of not only agricultural development but also of overall economic development. It is the real surplus generated by agricultural sector. It can be measured thus:
 
(Old stocks + Current output) - (Consumption + waste + inventories for next season)
 
Marketable surplus is referred to as 'gross surplus' from agriculture, while marketed surplus is referred to as 'net surplus' from agriculture.
 
Determinants of marketable surplus
 
The various variables that determine marketable surplus are I) size of holding ii) production of crop iii) size of family and iv) non-farm income. In addition to this, the quantity of marketable surplus will also depend on an efficient marketing system.
 
Importance of marketable surplus
 
Rising marketable surpluses are the real surpluses, which determine the real income, real savings, real capital formation and real investment and have great importance in raising the welfare in inflation free economies. Fall in the real marketable surpluses in less developed economies, raise the prices of not only foodstuffs but also of other wage goods and invariably the real levels of living of working class may go down.


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