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STUDY OF SUPPLY CHAIN
MANAGEMENT AND MARKETING OF

APPLE IN KASHMIR REGION OF
JAMMU AND KASHMIR, INDIA
SARFARAZ ASGHAR
B.Sc. (Ag.)
MASTER OF BUSINESS ADMINISTRATION

(AGRIBUSINESS MANAGEMENT)
2015

STUDY OF SUPPLY CHAIN MANAGEMENT AND MARKETING OF
APPLE IN KASHMIR REGION OF JAMMU AND KASHMIR, INDIA
BY
SARFARAZ ASGHAR
B.Sc. (Ag.)
PROJECT REPORT SUBMITTED TO PROFESSOR JAYASHANKAR TELANGANA

STATE AGRICULTURAL UNIVERSITY IN PARTIAL FULFILLMENT OF THE
REQUIREMENT FOR THE AWARD OF THE DEGREE OF
MASTER OF BUSINESS ADMINISTRATION

(AGRIBUSINESS MANAGEMENT)
CHAIRPERSON: Dr. Y RADHA
SCHOOL OF AGRIBUSINESS MANAGEMENT

COLLEGE OF AGRICULTURE
PROFESSOR JAYSHANKAR TELANGANA
STATE AGRICULTURAL UNIVERSITY
(Formerly part of Acharya N. G. Ranga Agricultural University)
RAJENDRANAGAR, HYDERABAD-500030
2015
CERTIFICATE
This is to certify that the project report entitled “STUDY OF SUPPLY CHAIN
MANAGEMENT AND MARKETING OF APPLE IN KASHMIR REGION OF JAMMU
AND KASHMIR, INDIA” submitted in partial fulfilment of the requirements for the
degree of ‘Master of Business Administration’ of the Professor Jayashankar Telangana State
Agricultural University (Formely part of Acharya N. G. Ranga Agricultural University),
Hyderabad, is a record of the bonafide original research work carried out by Mr. SARFARAZ
ASGHAR under our guidance and supervision.
No part of the project report has been submitted by the student for any other degree or
diploma. The published part and all the assistance and help received during the course of
the investigations have been duly acknowledged by the author of the project report.
(Dr. Y. RADHA)
Chairman of the Advisory Committee
Project report approved by the Student Advisory Committee
Chairperson : Dr. Y. Radha

Professor
School of Agribusiness Management
College of Agriculture
Rajendranagar, Hyderabad – 500030 _________________________
Member : Dr. Seema

Professor and Head
School of Agribusiness Management
Rajendranagar, Hyderabad – 500030 _________________________
Member : Shri M.H.V.Bhave

Associate Professor & Head
Department of Statistics & Mathematics
Rajendranagar, Hyderabad – 500030 ________________________
Date of final viva- voce

CERTIFICATE
Mr. SARFARAZ ASGHAR has satisfactorily prosecuted the course of project and
that project report entitled “STUDY OF SUPPLY CHAIN MANAGEMENT AND
MARKETING OF APPLE IN KASHMIR REGION OF JAMMU AND KASHMIR,
INDIA” submitted is the result of original research work and is of sufficiently high standard
to warrant its presentation to the examination. I also certify that neither the project report nor
part thereof has been previously submitted by him for a degree of any university.
Date: Chairperson
DECLARATION
I, SARFARAZ ASGHAR, hereby declare that the project report “STUDY OF

SUPPLY CHAIN MANAGEMENT AND MARKETING OF APPLE IN KASHMIR REGION
OF JAMMU AND KASHMIR, INDIA” submitted to the Professor Jayshankar Telangana
State Agricultural University for the degree of Master of Business Administration in
School of Agribusiness Management in the major field of Agribusiness Management is the
result of the original project work done by me. I also declare that no material contained in the
project report has been published earlier in any manner.
Place: Hyderabad (SARFARAZ ASGHAR)
Date: RMBA/2013-25
LIST OF CONTENTS
Chapter No . Title Page No.
I INTRODUCTION
II REVIEW OF LITERATURE
III MATERIAL AND METHODS
IV RESULTS AND DISCUUSSION
V SUMMARY AND CONCLUSION
LITERATURE CITED

SYMBOLS AND ABBREVIATIONS
% : Per cent
@ : At the rate of
& : And
et al. : and other people
etc. : Et cetera
c : Celsius
q : quintal
Fig. : Figure
ha : Hectare
i.e : That is
J&K : Jammu and Kashmir
JKHPMC : Jammu and Kashmir Horticulture Planning and

Marketing commission
Kg : Kilogram
MT : Million Tonnes
No. : Number
RBQ : Rank Based Quotient
RRBs : Regional Rural Banks
Rs. : Rupees
S. No. : serial number
t/ha : tonnes/hectare
Viz. : Namely
Acknowledgement
It is by the lavish and boundless blessing of the Almighty God that the author has
been able to complete his studies successfully hitherto and present this humble piece of work
for which I am eternally indebted.
With a humble heart, the author extol the genuine cooperation, inspiration, advice,
affection and the unconditional support offered to him by the Chairperson of his Advisory
Committee, Dr. Y. Radha, Professor, School of Agribusiness Management, College of
Agriculture, Rajendranagar, PJTSAU, Hyderabad right from the initiation of the work to
shaping of the manuscript.
The author also greatly express his deep sense of gratitude and a great privilege to
work under the highly exceptional guidance of Dr. Seema, Professor and Head, SABM,
College of Agriculture, Rajendranagar, Hyderabad and Member of Advisory committee, for
her counsel and suggestions.
The author expresses his sincere thanks to Sri M.H.V.Bhave, Associate Professor and
head, Department of Statistics and Mathematics and Member of the Advisory Committee for
his invaluable guidance, suggestions and support during the author’s course of study.
Furthermore, the author expresses his deep sense of gratitude to Dr. P. Radhika,
Associate Professor, School of Agribusiness Management, College of Agriculture,
Rajendranagar, PJTSAU for her continuous support and encouragement at all times.
The author also expresses his heartfelt love and affection from the inner core of heart
to his beloved parents Shri Ajaz Asghar and Smt. Asfa Khatoon, for their blessings,
guidance, inspiration, encouragement and moral support throughout his educational career.
They have been the source of confidence and motivation all through his life.
The author owes much also to his loving brothers Shahnawaz and Mumtaz for their
everlasting affection, support and encouragement in his life.
It is time to surface out genuflect love and affectionate gratitude to the author’s
dearest friends Owais, Sankupar, Kamran, Amir, Shyam, Tabassum, Surekha, and
Vidyasagar and for their blessings, inspiration, encouragement and moral support
throughout his educational career.
Gladly the author expresses his sincere thanks to Amir, Ahmad Mansoor, Owais,
Kamran Irshad, Naeem, Anwar, Zakir, and Zubair for extending their help in data
collection. Words are not enough to express my heartfelt thanks to my senior Zubair,
Donbor, Poonam, Arshia, Vinay Kumar, Rajiv Ranjan, and Radha Priyanka; my dear
juniors Gulab, Priyabatra Sahu, Ghulam Hassan and Irshad and also thankful to Non-
teaching staff Upendra, Victoria and Anand for their moral support, which instilled in me
confidence to proceed forward.
Finally the author is very much thankful to Acharya N. G. Ranga Agricultural
University and Indian Council of Agricultural Research for the financial support received to
pursue MBA(Agribusiness).
Date: SARFARAZ ASGHAR
Place: Hyderabad (AUTHOR )

AUTHOR : SARFARAZ ASGHAR
STUDY OF SUPPLY CHAIN MANAGEMENT AND MARKETING

TITLE OF THE OF APPLE IN KASHMIR REGION OF JAMMU AND KASHMIR,
:
PROJECT WORK
INDIA
DEGREE : MBA (ABM)
FACULTY : AGRICULTURE
DEPARTMENT : SCHOOL OF AGRIBUSINESS MANAGEMENT
CHAIRPERSON : Dr. Y. RADHA
PROFESSOR JAYSHANKAR TELANGANA

UNIVERSITY :
STATE AGRICULTURAL UNIVERSITY
YEAR OF
: 2015
SUBMISSION
ABSTRACT
Apple (Mallusdomestica) is the most important temperate fruit in India. India is the
fifth largest producer of apple in the world. India produced 2497.68 metric tonnes of apple,
out of which Jammu and Kashmir produced1348 metric tonnes of apple in 2013-14. In
Jammu and Kashmir, apple is cultivated in an area of about 143.58 thousand hectares with
an average productivity of 11.47 t/ha (http://www.agriexchange.apeda.gov.in). Apple is
cultivated almost across all regions of Kashmir valley with Baramulla and Shopian districts
being the major producers. Apple is a non-climacteric fruit and requires extra care while
transporting it to different markets.
The study was conducted inBaramula and Shopian districts of Jammu and Kashmir
statewith the following objectives
¾ To identify the supply chain of apple in Kashmir valley.
¾ To identify the marketing channels of apple and assess their marketing
efficiency.
¾ To identify the constraints in apple marketing

About 80 apple growers and 40 market intermediaries were selected from four tehsils
viz., Rafiabad, Sopore, Kellar and Shopian in Jammu and Kashmir state. The results of the
study showed the supply chain, marketing channels and marketing efficiency, price spread
and constraints associated with various aspects of production and marketing. Four channels
of marketing were identified which are:
¾ Channel I: Producer ─ Pre-harvest contractor ─ Commission agent cum wholesaler

─ Retailer ─ Consumer
¾ Channel II: Producer ─ Village trader ─ Wholesaler (local) ─ Commission
agent(distant) ─Wholesaler (distant) ─ Retailer (distant) ─ Consumer
¾ Channel III: Producer ─ JKHPMC ─ Wholesaler ─ Retailer ─ Consumer
¾ Channel IV: Producer ─ Consumer
¾ The producer’s share in consumer’s rupee was the highest in channel IV since it is
the shortest channel (60.99 per cent), whereas the producers share in consumer’s
rupee in channel I, II, and III were 39.09 per cent, 23.49 per cent and 44.19 per cent
respectively.
¾ The marketing efficiency index of channels I, II, III and IV was 0.641, 0.30, 0.79
and 2.56 respectively.
¾ The constraints analysis of farmers through RBQ value revealed that spurious
pesticides and fungicides, involvement of too many middlemen, inadequate grading
facilities and lack of labeling and trademark were ranked the highest among the
constraints identified under production, marketing, value addition and policy
aspects respectively.
¾ The traders expressed that high transport cost and dual inter-state taxation were the
major constraints under marketing and policy aspect respectively.
The study suggested an overall improvement in providing market information, quality of

fruits, provision of cold storage, etc. to increase producer’s share in consumer’s rupee. It
was also suggested to have one time taxation on weight basis to avoid the problem of dual
inter-state taxation.

Chapter I
INTRODUCTION
1.1 PRELUDE
“India’s future is in her farms. Agriculture has the potential to accelerate growth
and social development in India” Mukesh Ambani.
The state of Jammu and Kashmir comprising of temperate, cold, arid and hilly areas, is
located in the North-Western region of India and faces more complex problems in agriculture
development than that of plains due to extreme agro-climatic conditions, topographic situation
and numerous other factors. Jammu and Kashmir is known as temperate fruit bowl of India and
is bestowed by nature with the production of variety of apples (Delicious, American, Maharaji,
Hazratbali, Razakwari, Kesari and others) in considerable quantity. In India majority of
cultivated varieties of apple (Malus domestica) were introduced by British officers way back in
1865. The horticulture sector of the state of Jammu and Kashmir is spread over an area of 3.70
lakh hectares with an annual production of 19.13 lakh metric tonnes. Apple from Kashmir
occupies the dominant position and holds about 70.39 per cent of total apple production in
India. Between 1974-75 and 2013-14, the area under apple production has gone up from 46189
hectares to 1432815 hectares. Kashmiri apple has lived up to its reputation for being one of the
choicest fruits from among various fruits available in different markets of India. (Greater
Kashmir, 07 May, 2014).
Marketing is a comprehensive function; it is concerned with every aspect of the produce

from its inception, design, pricing, distribution, selling and promotion until it finally reaches the
hands of the consumer. It includes all activities involved in the creation of time, place, form and
possession utility. American Marketing Association defined marketing as the performance of
business activities that directs the flow of goods and services from producers to users. The
marketing pattern of apple is different from other agriculture commodities. It is a complex
phenomenon as it involves lot of nodes and channels. The agricultural commodities in general
are first brought to the wholesale markets near the production area and then supplied from there
to the terminal markets. A large number of middlemen are involved in the channels of trade
between the apple producers and the consumers. There is also an evidence of collusion amongst
the apple merchants to control apple prices within the market and to influence pricing in other
market. The marketing system for apple is therefore, of utmost importance for those growers
who specialise in apple production and of great importance to all those people who are
concerned with the producer’s share in the consumer’s price. Apple marketing in the Kashmir
valley, virtually in its entirety, is carried out by the private sector, comprising of pre-harvest
contractors, forwarding agents, commission agents, wholesalers and retailers.
Apple marketing, being a complex phenomena, requires special treatment and utmost
care at present, in the Kashmir Valley. Due to powerful intermediaries, the present marketing
system has an inherent tendency to give more benefits to the intermediaries at the cost of apple
growers. The present marketing structure shows that 87% of the marketing activities are solely
performed by the powerful intermediaries (Reshi et. al., 2010).
1.2 APPLE PRODUCTION IN INDIA

Among all the states in India, Jammu and Kashmir ranks first in apple production
with a total production of 1348 MTS followed by Himachal Pradesh (412 MTS) and
Uttaranchal (123 MTS) during the year 2012-2013 (Fig 1.1 and Fig 1.2).
Table 1.1 Export (quantity and value) of apple to major countries from India
(2014)
S. No. Country Quantity (kg) Value (Rs.)
1 Bangladesh 3,07,01,908 63,75,97,571
2 Nepal 49,14,306 18,63,06,570
3 Sri Lanka 4,44,316 3,44,90,521
4 United Arab Emirates 30,607 34,16,895
5 Saudi Arabia 420 14,761
6 Switzerland 50 1,435
Total 3,60,98,057 86,23,76,795
Source: DGCIS Annual Export 2014

F 1.1 Apple producin
Fig ng states in IIndia
S
Source: APEDA, 2013
1348
1400
production (000 Tonnes)
1200
1000
800
600 412
400
123
200 2
0
Jam
mmu and Himachal Uttaranchal Arunachal
K
Kashmir Pradesh Pradesh
2012‐13
ar
yea
Fig 1..2 Apple prooduction in major statees of India
S
Source: APEDA, 2013
India exported a total of 3,60,98,057kg of apples to other countries and earned a
total of Rs. 86,23,76,795 as foreign earnings (APEDA, 2013). Bangladesh was the
major importer (3,07,01,90kg) followed by Nepal (49,14,306kg) and Sri Lanka
(4,44,316kg) during 2014 (Table 1.1).
1.3 HISTORY OF APPLE IN KASHMIR
There are lot of mentions about apple in Kashmir in the history, where the
famous Chinese pilgrim Huen Tsang, who travelled to Kashmir has made a mention of
various temperate fruits like Pears, Apricot, Grape and Apple. The breathtaking and the
stunning beauty of the valley of Kashmir and its temperate fruits like apple have been
complimented by people from different areas including writers and travellers belonging
to different ages and nationalities. Modern cultivator of fruit trees consider that apple
has an origin starting from the temperate zone of Britain in the North West to
Himalayas in the South East which accounts for a very vast area.
Till 1945, there was no clear identification of scientific nomenclature and

detailed report of fruit tree-varieties of various kinds that are grown in Kashmir. It was
only after various surveys, it was identified the availability of 113 varieties of apples, 62
varieties of pears, 31 of plum, and 14 of cherry in early, medium, and late groups,
besides scores of Wild Crabs variety of apples, etc. But still there are various ancient
records which state that the cultivation of the temperate fruits like apple is nearly 3000
years old. Kalhana in Rajtarangni makes mention of it in the reign of King Nara
(1000BC). One of the most famous places in the valley of Kashmir noted for its apple
cultivation is Sopore in Baramulla district, for it has lot of apple yards.
(www.indianmirror.com, 2014).
1.4 STATUS OF APPLE PRODUCTION AND MARKETING IN JAMMU AND

KASHMIR
The state has the largest potential for production of quality temperate horticulture
crops. It has created niche production of apple, pear, cherry and dry fruits. Among
temperature fruits, apple ranks first position in terms of production and productivity.
The annual production of apple in the state is about 9.09 lakh tons with an average yield
of 10.09 tons per hectare. However the production and productivity of apple crop has
been fluctuating during last two decades. This was due to drought or some other
climatic conditions. In spite of this, apple production has increased from just 6 lac tons
in 1950-51 to more than 16.47 lac tons in 2013-14. The apple productivity of the state
(11.47 t/ha) is much higher than the national level of 6.86 t/ha and that of the average of
10.82 t/ha or that of China (9.93 t/ha), which is the world’s highest producer of apple
(Directorate of Horticulture Planning and Marketing J&K, 2013).
However, the latest trend indicates that there has been conversion of paddy
fields into apple orchards as it is more profitable to farmers. The agriculture land is
shrinking at an alarming rate in Kashmir valley, particularly in South Kashmir, once
known as the rice bowl of Kashmir. The Horticulture Department in its recent report
(Horticulture Digest, Jammu and Kashmir, 2014) mentioned that the area under the
apple crop has increased by 3378 hectares from 1,40,156 ha in the year 2012-13 to
1,43,534 ha in 2013-14 (Table 1.2).
Table 1.2 Area, Production and Productivity of apple crop in Jammu & Kashmir
(2005-2006 to 2013-2014)
Year Area Production Productivity
(000 ha) (000 MT) (t/ha)
2005-2006 111.88 1151.34 10.29
2006-2007 119.04 1222.28 10.26
2007-2008 127.80 1311.85 10.26
2008-2009 133.10 1332.81 10.01
2009-2010 139.04 1336.79 9.61
2010-2011 141.72 1852.42 13.07
2011-2012 141.94 1775.53 12.50
2012-2013 142.38 1370.5 9.34
2013-2014 143.58 1647.69 11.47
Source: Directorate of Horticulture Planning and Marketing, Jammu and Kashmir
Supply chain in apple production comprises of vast network of input suppliers,

marketing channel and services that helps in production of apple and right up to the
delivery of apple to final consumer. Many national and international companies market
their brands of fertilizers and plant protection chemicals to farmers through their
agencies or local dealers. There exists vast supply chain network which helps in
movement of apple to customers via different stages of marketing.
The biggest wholesale market for apple is Fruit and Vegetable Market
Azadpur, Delhi, where about 70 per cent of the total traded apple is distributed,
followed by Mumbai, Bangalore, Ahmadabad and others (Reshi et. al., 2010). The
season of market arrivals from Kashmir is August to November with a peak in
September to October. There are a number of marketing channels, of which the
predominant are:
• Farmer – Pre-harvest contractor – Commission agent – Wholesaler –
Retailer – Consumer.
• Farmer – Forward agent – Commission agent – Wholesaler – Retailer –
Consumer.
• Farmer – Commission agent – Wholesaler – Retailer – Consumer.
The sale through pre-harvest contractor is the most important system of

marketing. Normally the small orchardists sell their crop at flowering stage to the
contractor who organizes plant protection, plucking and packaging of fruit. The
medium and large orchardists prefer to market their produce through second and third
channels respectively.
It has been found that price risk is faced by growers and contractors since there is
no guarantee of increasing trend in the market price of the fruit as it was fluctuating.
There is no support from the Government in the home market and perishability of the
product also becomes proximate cause of dwindled price. Also, there is poor integration
of domestic markets with those of national markets. In view of shipment of fruit to the
wholesale market by unrefrigerated trucks (vehicles), growers have no option left but to
sell the produce immediately at lower price (Zahoor and Tapan, 2014).
With this back ground, the present study on apple production and marketing in
Kashmir region was carried out to understand the supply chain and marketing efficiency
of apple with the following objectives.
1.5 OBJECTIVES OF INVESTIGATION
1. To identify the supply chain of apple in Kashmir valley.
2. To identify the marketing channels of apple and assess their marketing efficiency.
3. To analyse the constraints in apple marketing.
1.6 SCOPE OF THE STUDY
The study was conducted to understand the supply chain of apple and its
marketing efficiency along with the constraints in apple marketing in selected districts
of Jammu and Kashmir. An attempt has been made to understand the scenario of apple
marketing in the Kashmir region of Jammu and Kashmir. The perception of farmers and
dealers towards distribution and marketing strategies and the factors influencing the
marketing efficiency have been examined. The study will also give an idea about the
market structure in Kashmir and the same will be useful for both the dealers and the
farmers in planning future marketing strategies in particular for Kashmir and the
country in a wider context. The study would also be helpful to maximise the efficiency
of marketing channels by addressing the various constraints in apple marketing.
1.7 LIMITATIONS OF THE STUDY
The present study is not a wholistic study but with the following limitations
• The study is based on the data collected from recall memory of the respondents
including farmers/growers/traders, which may not reflect the data in true sense.
• As the respondents do not understand the genuine purpose of the research study,
they have the sense of fear to part with the exact information.
• Investigator of the study has limited resources in terms of time, manpower and
money.
• Respondents are also having the limitation of time.
• Generalization of result is also not possible as the study pertains to a selected
area.
1.8 STRUCTURE OF THE REPORT
The study is presented in six chapters as follows
I. Introduction: The importance of the study, problem setting and objectives are
covered.
II. Review of literature: The available and relevant literature is thoroughly
reviewed.
III. Material and Methods: The methods and material encompassing sampling,
data collection, analytical tools, concepts and terms are explained.
IV. Results and Discussion: The results and discussion chapter presents the results
obtained after the analysis of the data collected.
V. Summary and Conclusions: Summary and conclusions are presented along
with the suggestions and policy implications.
CHAPTER II
REVIEW OF LITERATURE
With a view to evaluate the objectives of this study, it is considered significant to have an
idea of the findings of some earlier research studies and methods adopted there in. The
review of literature familiarizes the researchers with the work that has already been done in
the area of their interest and also provides useful information in planning the study. A number
of studies have been conducted on the production and marketing of fruits in India and abroad.
This chapter is devoted to examine the research work done in the past on different aspects of
the problem under study. The studies having direct or indirect relation with the production
and marketing of apple, market arrivals and prices, various marketing channels, costs,
constraints/problems in their production and marketing etc. are included under the following
heads in this chapter.
2.1 Supply chain analysis of fruits and vegetables

2.2 Marketing channels and marketing efficiency of fruits and vegetables
2.3 Constraints in production and marketing of fruits and vegetables
2.1 Supply chain analysis of fruits and vegetables
Negiet al.(2014)highlighted the need and importance of efficient supply chain to

remove various bottlenecks and reduce the losses and wastage in fruits and vegetable sector.
Their research conducted on the supply chain of fruits and vegetables sector in India suggest
that the supply chain is highly inefficient which is leading to huge losses and wastages and
less income to the stakeholders. The authors stressed upon the need to set up the cold chain
infrastructure and food processing units to reduce post production spoilage.
NavitaMahajan(2013) in her study points towards the importance of cold storage in

supply chain management and value chain addition of apples in Himachal Pradesh. As per
her study, over 90% of fruit is sold through open market system like Push cart vendors,
Roadside vendors, Non permanent shops, which do not have any cold chain facility to
maintain the products temperature. So the product which is kept for 2-3 months gets severe
heat injuries and deterioration in quality due to temperature outside, especially during April-
May, if not kept in temperature controlled storage facility.
MitulDeliyaet al. (2012) reported the various constraints faced by marginal and small
farmers in supply chain management of horticulture products. Due to improper supply
chain,almost 30% loss is evident in fruits. Their study indicated that the benefits to
consumers and producers can increase by 20%-25% in the most perishable commodity with
appropriate supply chain operations.
Nityanand and Prachee (2011) observed that the supply-chain management of

perishable food products is a very typical issue, which is to be adequately managed to gain
the competitive advantage for optimum profit in the current scenario.
Vishwanadham (2010) analysed the deficiencies in the Indian supply chain in the food
retail. The most important problem associated with the Indian food industry is the inefficient
supply chain as a result of which about 20 per cent of the food produce worth Rs. 10,000
crore is wasted. Only through developing an efficient supply chain can India’s population
have access to affordable superior quality food produce while ensuring remunerative prices to
the farmers. Manufacturers, wholesalers, distributors and retailers can achieve tangible
benefits through innovative network and inventory optimisation. The benefits may include
enhanced demand intelligence, improved sales and services, optimised inventory levels,
increasing profitability and margins and enhanced trading partner collaboration.
Gibson et al. (2009) observed that the retailers are more reliant than ever on supply
chain management for organizational success. The focus of supply chain management is to
cut down inventory levels while maintaining high in-stock availability, reducing
transportation expenses in the context of fuel price volatility. Efforts are well under way to
link supply chain strategies to organizational plans.
Bhardawajet al. (2008) studied the factors influencing the supply chain of fruits and
vegetables in India and concluded that backward marketing is the least efficient in supply
chain in the country. There is lot of price spread in inputs for farmers particularly in
pesticides where cost is very high for the final consumer.
Leigh (2006) gave a detailed account of the evolution of retail supply chain
management. He discussed a number of changes that are taking place in modern retail supply
chain in direct response to the changing demands of consumers. He also explained how these
changes prompt a number of implications for the management of the retail supply chains.
Raghunath and Ashok (2005) studied Indian agricultural produce supply chain and
distribution system towards an integrated supply chain system and concluded that the best
way to increase efficiency in supply chain of agricultural produce is to integrate various
inputs needed by farmer in one channel and then bulk purchase. The authors also suggested
various channels for distribution of agricultural produce in cities through most efficient
channels to decrease price spread.
Lokollo (2004) studied on cooperative marketing of fruits and found it to be highly

effective and efficient in social upliftment of poor and small farmers. The author concluded
that by proper and efficient supply chain management, there is a huge impact on poverty
reduction in developing countries.
Masini (2004) studied the supply chain planning optimization in the fruit industry in
Argentina and points towards the processing industry and its importance in value chain
addition in apple. She also calculated a mathematical model for consistent supply of apple to
juice processing plants.It optimally decides production plans for fruit and juice to satisfy
customer orders from different markets, while it optimally allocates sources of raw material
and processing plants, based on capacities and cost.
Seyed-Mahmoud Aghazadeh (2004) in his paper explores ways of improving logistics

and distribution supply chains of the food retail industry. The results reveal slow progress in
accomplishing the goals of leaner supply chains and easier distribution. The study discusses
how consumer driven, time-phased planning provides solutions to these challenges such as
including the consumer in the supply chain planning process, managing product life cycles,
promotional planning, planning for seasonal products, integrating with category management,
determining cost-effective supply channels and planning capacities at the store level.
Ayiekoet al. (2003) studied fresh fruits and vegetable supply chain system in Kenya
and suggested several policies to make the supply chain more efficient. The authors stressed
up on the need of bulk purchases of inputs to reduce cost as well as précised delivery date
calculations to minimize losses due to spoilage.
Cotteril (1996) studied food distribution and supply chain system in United Kingdom
and United States of America and compared their efficiency in supply chain management.
Their comparison revealed the superiority of cooperative based supply chain system
prevalent in United Kingdom and Western European nations than corporate based supply
chain. The bargaining power of cooperative based supply chain was found to be much higher
than individual based.
2.2 Marketing channels and marketing efficiency of fruits and vegetables
Murthy et al. (2009) in their study on marketing and post-harvest losses in fruits i.e.
mango, banana, grape and pomegranate found that the marketing cost, margin and efficiency
of marketing depends primarily on the channels of marketing. The marketing cost in mango,
banana, grape and pomegranate accounted for nearly 16.82, 27.52, 23.15 and 20.98 per cent
respectively. Farmer’s net margin in the consumer’s rupee was low due to the predominant
role played by the wholesalers and retailers who among themselves shared about 46 per cent
in mango and 68 per cent in grapes. In banana and pomegranates, the farmer’s net share in
consumer’s rupee was 53 and 50 per cent respectively. The market efficiency in mango,
grape, banana and pomegranate was 0.85, 2.13, 1.12 and 1.01 per cent respectively.
Singh and Gajamana(2007) observed that one of the important measures of marketing
efficiency is the share of producer in the price paid by the ultimate consumer-buyer. The
study revealed that the farmer-producer of tomato, cabbage, cauliflower and cucumber
received less than 50 per cent price paid by the consumer-buyer, the range being 37.26 per
cent (tomato) to 49.16 per cent (cauliflower). The share of producer includes the marketing
cost which is very high.
Sekhon (2006), in his study, have examined the marketing of apple in Amritsar. It was
found that 99 per cent of the pear was sold in Delhi market by contractors and farmers. The
sale in local Amritsar market was just about 1 per cent. Two marketing channels were
generally used in both Delhi and Amritsar markets. Channel-I: Producer-Pre-harvest
Contractor-Retailer-Consumer. Channel-II: Producer-Retailer-Consumer. The producer’s
share in the consumer’s rupee was the highest (70 per cent) in channel-II in Amritsar market.
It was due to self-sale in local market where marketing costs were less.
Khatkaret al.(2005) found that, in marketing of mushroom in Haryana, major share of

consumer’s rupee has gone to the pockets of the middlemen. He therefore advocated the
government intervention to safeguard the farmers’ interest by introducing cooperative
marketing and processing of agricultural products. One of the important aspects of
agricultural marketing of a country is the behaviour of prices of the agricultural produces.
The prices of agricultural commodities are lowered generally during the harvesting period. A
number of studies revealed that a large number of middlemen function at various stages of
agricultural marketing in India.
Murthy et al.(2004) in the research estimated the post harvest loss of grapes at
different stages of handling viz. field level, transit and wholesale marketing level and at retail
level. The loss at the field level due to damages in bunches or berries, which were estimated
in field at Bijapur, Karnataka, worked out to 7.31%. The water berry or mummy is the major
contributing factor accounting for about 43.3% of loss at the field.Some other major causes of
loss at the field level are damage to the berries due to insects and pest and loose berries drop
at the time of harvesting due to sunburn injury, physical injury etc.
Devaraja (2000) examined the various channels involved in the marketing of fruits
and vegetables in Belgaum district. The study showed that the amount spent by the producers
towards the marketing of 56 horticulture produce like fruits and vegetables was more than 55
per cent of the cost of inputs used for raising the produce. The commission agents played a
dominant role in marketing of fruits and vegetables in the district. Direct sales to retailers
were less than 10 per cent. The old practice of selling fruit orchards to pre-harvest contractors
was dominant. Most of the produce was sold through auction and bargaining. The study
suggested that there is a need to control the activities of commission agents for encouraging
self-marketing.
Subrahmanyamand Gajamana (2000) studied the farmer’s share in consumer rupee for
fruits in Punjab. They reported that most of the small and marginal farmers lease out their
orchards to pre-harvest contractors. Producers’ share in the consumer rupee varied from 25
per cent to about 40 per cent in most of the fruit growers. The pre-harvest contractors who did
not make any fixed investment on the orchards also got more than the producer’s share. There
is no doubt they had to incur some expenses on the watch and ward of their orchards, picking,
packing, transportation of the produce, etc. They also reported that in “ApniMandi” scheme
also the domination of the traditional fruit and vegetable retailers outnumber the farmers.
Azad (1991) found the various marketing channels and middle men involved in
movement of apple from producer to consumer. The excess involvement of middlemen was
the major cause of low share of producer in consumer’s money.
Acharyaand Agarwal (1987) analysed the production and marketing of apples in
Himachal Pradesh and Kashmir and identified various marketing channels in Azadpurmandi
in Delhi. The apples of Jammu and Kashmir were shown to fetch lower prices due to late
arrival in market as well as lack of proper transport system to Delhi
2.3 Constraints in production and marketing of fruits and vegetables
JavidBhat (2010) examined the problems related with the pre-harvesting operations in
Kashmir valley and cited credit availability, militancy, lack of cooperative agency, lack of
subsidy inputs, among the various reasons hindering the marketing operations of apple.
Among post harvest operations, the author points towards lack of grading facility, labelling,
problem of marketing credit, commission agents monopoly and lack of group marketing
among other several factors.
Palaniappanet al. (2010), in their study, concluded that during the year 2008-09, the
major reasons for the low productivity of apple were price variability, bacterial diseases,
erratic moisture and poor water use efficiency, etc. Even in India’s peak apple harvest month
of October, apple prices were higher than for other competing fruits.
Reshiet al. (2010) stated that the pre harvest and post harvest practices followed by
growers in Kashmir were primitive compared with those followed in USA,China and
Australia.No special provisions from government regarding monitoring, finance,precautions,
standard pesticides and fungicides and fertilizers. Also there is derth of cold storage and
shipment problem along with packing material availability.
Sunil Kumar (2003) in his article “Role of future markets in stabilisation of agro
commodity prices” expressed concern over the wide price fluctuations in the commodity
markets and the absence of market based risk instruments and the plight of farmers towards
less risky cultivation which perpetuates the growth of Indian agriculture
Asifand Hashmi (1998) analysed the various constraints in apple production and
marketing and concluded that for fetching premium price, spray and disease management
should be strictly followed in apple orchard. The author also suggested various markets in
India where farmers of Jammu and Kashmir can fetch premium price for their produce.
Subrahmanyam (1998) summarised that there are two types of risks faced by the
cultivators viz. i) the price risk i.e. the wide price fluctuations due to oversupply in peak
season and ii) the risk created by the middlemen in the market i.e. illegal deductions,
overcharging, offering low prices through collusion and under weighing.
Atteri and Chand (1997) examined that the yield growth rates of fruits were negative
while for vegetables these were positive during 1991 to 1995. However, due to lack of
infrastructural facilities, almost one-third of total fruits and vegetable crops production worth
Rs.5000 crore was found to be lost annually. This can be saved through processing and
preserving these crops well in time.
Ghulam (1994) through his comparative study of apple in Himachal Pradesh and
Kashmir concluded that Jammu and Kashmir has more production than Himachal Pradesh
annually. J&K apples were found much tastier than apples of Himachal Pradesh but still do
not fetch the price that Himachal Pradesh apple does. Many reasons were behind it, as one of
the main reasons is that Himachal Pradesh's apples come to the market at least three months
before the Kashmiri apple. Another factor contributing to
the popularity of Himachal apples is their shape, size and colour.
Nizamuddin Khan (1990) in his paper on needing remunerative agricultural marketing

has highlighted the various ills prevailing in agricultural marketing. According to him,
Agriculture marketing in India is suffering from different infrastructural, organizational, and
functional intersections; it is inefficient and non-remunerative to producers, the sellers.
Distress sales, especially in villages, were the common practice during the glut seasons.
Small and marginal farmers were adversely affected and they were forced to mortgage their
surplus to the commission agents in order to obtain loans at the time when they were in
distress. Inadequate infrastructural facilities like weather roads and storage, farmers of small
size, marketable surplus, non suitable linkage to the regulated and rural markets from the
villages as well as producers. Weak organizations were the significant factors, which prevent
the growers to get fair price from their per unit of marketed surplus in the markets.
Chapter III
MATERIAL AND METHODS
The present study was carried out in the state of Jammu and Kashmir with
special emphasis on selected districts viz., Baramulla and Shopian and also in general
the whole of the Kashmir region was studied to know the supply chain of apples based
on primary data. The specific objectives pertain to the analysis of supply chain
identification, marketing strategies and constraints of apple production and marketing in
Kashmir valley. This chapter presents the description of study area, nature and method
of data collection, sampling procedure and analytical tools applied in attaining the
objectives of the study under the following sub headings.
3.1 Description of study area.

3.2 Sampling procedure
3.3 Data collection
3.4 Items studied under investigation from farmers
3.5 Items studied under investigation from traders

3.6 Tools of analysis
3.1 DESCRIPTION OF STUDY AREA
3.1.1 Geographical description of the state
Jammu and Kashmir State constitutes the Northern most extremity of India. It is
situated between 32.17 degree and 36.58 degree North latitude and 37.26 degree and
80.30 degree East longitude. The Himalayas divide Kashmir valley from Ladakh while,
the Pir Panjal range, which encloses the valley from the West and the South, separates it
from the Great Plains of Northern India. The Kashmir valley has an average height of
1,850 metres above mean sea-level. In the West and North Western part, the state shares
boundary with China, while in East and North East, Pakistan and Afghanistan countries
have the boundaries with Jammu and Kashmir (Fig 3.1).
Physical map Political map
Fig 3.1 Maps of Jammu and Kashmir
Source: mapsofindia.com
The total area of the State of Jammu and Kashmir is about 2,22,236 sq km. The
State shares a 221 km international boundary with Pakistan in the Jammu region and
365 km with China in its Ladakh sector. The line of control (LoC), which divides the
Indian and Pakistani parts of the state, is 1001 km long. The Siachin border with China
is 465 km long (www.wikipedia.com).
3.1.2 Demographic description of the study area
The population of Indian administrated J&K State was around 12,548,925 as per
2011 census. The male population was 6,665,561 and the female population was
5,883,365. The population growth since the last census was 23.71 per cent and the
whole population of the state forms 1.04 per cent of the entire population in India.
Jammu and Kashmir has a population density of 56 per sq km (www.wikipedia.com).
Baramulla district
Baramulla district is one of the 22 districts in the state of Jammu and Kashmir.
The district covered an area of 3,353 km² with a population of 1,015,503 at the time of
2011 census. Of the total population, 542,171 (53.4%) were males and 473,332 (46.6%)
were females, the sex ratio being 873 females for every 1,000 males, which is much
lower than the national average of 940 (www.censusindia.gov.in).
The district has a population density of 305 inhabitants per square
kilometre. Its population growth rate over the decade 2001-2011 was 20.34 per cent.
Baramulla has a literacy rate of 66.93 per cent, with male literacy of 77.35 per cent and
female literacy of 55.01 per cent.
Shopian district
Shopian district has a population of 265,960. The district has total area of 307 km²
with a population density of 852 inhabitants per square kilometre. Its population growth
rate over the 2001–2011 decade was 25.85 per cent. Shopian has a sex ratio of
951 females for every 1000 males, and a literacy rate of 62.49 per cent.
(www.wikipedia.com).
3.2 SAMPLING PROCEDURE
3.2.1 Selection of the study area
The two districts viz., Baramulla and Shopian were selected purposively as they
represent the top two apple producing districts of Jammu and Kashmir. Of these two
districts, Shopian district is known as the Apple Bowl of the state as it is famous for
horticulture sector for its premium quality of apple. The challenges and conditions of
production and marketing were almost similar in both the districts. These two districts
represent a combined area of 3660 square kilometres. Because of the similar product
nature and way of cultivation of apple, as well as growing challenges faced by the
farmers of these districts, these two districts formed an ideal place for the study.
Table 3.1 Details of the selected study area in Jammu and Kashmir
District Tehsil Village
Rafiabad Kitardaji
Baramulla
Dangiwicha
Sopore Goripora
Darpora
Kellar Moshwal
Shopian
Potterwal
Shopian Arshipora
Sharatpora
Two tehsils from each of the two selected districts and two villages from each of
selected tehsil were selected randomly. This constitutes the final study area of eight
villages representing four from each of the two selected districts in the state of Jammu
and Kashmir (Table 3.1).
In Baramulla district, two tehsils viz., Sopore and Rafiabad were selected. Two
villages named as Goripora and Darpora were selected for study from Sopore tehsil.
Kitardaji and Dangiwicha villages were selected from Rafiabad tehsil. From Shopian
district, two tehsils namely Kellar and Shopian were selected, while two villages
namely Moshwar and Potterwal were selected form Kellar tehsil, and from Shopian
tehsil, the villages selected for the study were Arshhipora and Sharatpora.
3.2.2 Selection of the respondents
A total of ten farmers and five traders from each of eight villages were selected
randomly, thus making the final sample to a total of 80 farmers and 40 traders/dealers.
3.3 DATA COLLECTION
3.3.1 Nature and source of data
The primary data on apple production, post production operations, market

functionaries and various constraints were collected from the sample farmers through a
pre-tested questionnaire. Similarly, primary data were also collected from dealers /
intermediaries regarding quantity handled, various marketing channels and constraints
faced by them through a pre-tested questionnaire.
The relevant secondary data were collected from books, web sources, Directorate
of Horticulture Planning and Marketing, Jammu and Kashmir and Sher-E-Kashmir
University of Agricultural Sciences and Technology of Kashmir, Jammu and Kashmir,
etc.
3.4 ITEMS STUDIED UNDER INVESTIGATION FROM FARMERS
3.4.1 Varieties grown
Farmers grow a lot of varieties in apple orchards such as Red Delicious,

American Apirogue, Ambari, Hazratbali etc. These varieties mature at different times
of the year, thus prolonging the harvesting season.
3.4.2 Cropping pattern
The information on different crops cultivated by the farmers along with apple
production are also collected and recorded.
3.4.3 Post production operations and costs
A lot of activities are performed by farmers after the fruit gets ready for
harvesting which adds to the cost of production. The cost of activities such as spraying,
plucking, grading, transport etc. were calculated to get an idea of post production costs.
3.4.4 Identification of market functionaries
There exist a lot of market functionaries which leads to price spread. The
existence of large number of market functionaries leads to inefficiencies in the supply
chain of apple from producer to consumer. An attempt was made to identify the various
market functionaries which are dealing with apple produce.
3.4.5 Supply chain of apple production
Supply chain of apple production starts from the supply of inputs required by the
input manufacturers until the various inputs required for production are made available
to the farmers. A lot of goods and services are involved to produce the apple through
different channels. The motive is to make inputs available to the farmer in most efficient
and profitable way.
3.4.5 Constraints faced by the farmers
Constraints faced by the farmers were grouped under the following heads
a. Production constraints
b. Marketing constraints
c. Value addition constraints
d. Policy constraints
The constraints were framed with five options against each and Likert Scaling
technique was used to measure the score of each constraint.
3.5 ITEMS STUDIED UNDER INVESTIGATION FROM TRADERS
3.5.1 Area of operation
Traders were classified as local, state level and national level dealers based on
their area of operation. .
3.5.2 Marketing channels and their cost of operations per unit of product
The market functionaries involved in different marketing channels of apple

marketing were identified. The items handled by the functionaries and the per unit cost
of each operation were identified to calculate the efficiency of identified marketing
channels.
3.5.3 Marketing efficiency
Marketing efficiency is a measure of market performance. The movement of

goods from producer to the ultimate consumer at the lowest possible cost consistent
with the provision of service desired by the consumers is termed as efficient marketing.
It is desired to achieve efficiency in marketing of apple so as to maximize the profit as
well as for competitive advantage in terms of final prices of apple in the market.
3.5.4 Pre-harvest contractor
The persons who agree to buy the produce generally even before the actual
harvesting takes place as per the terms and conditions prevailing in the market. In a
way, they are forward traders.
3.5.5 Wholesaler
The merchant middlemen who buy and sell agricultural commodities in large
quantities. They may either buy from farmers or from other pre-harvest contractors.
3.5.6 Distant wholesaler
One who involves in buying activity by contacting the wholesaler over telephone.
He is the one who performs marketing activity in distant markets as Delhi, Lucknow,
Jammu, etc.
3.5.7 Commission agent
The commission agents are the one who act as an agent between farmer-producer
or pre-harvest contractors and wholesaler in arranging the sales of apple. In regulated
agricultural markets, any business man registered with market committee can act as
commission agent.
3.5.8 Retailer
Retailers buy goods from wholesaler and sell them to consumers in small
quantities. Retailers are closest to consumers.
3.5.9 Supply chain of apple marketing
Supply chain of apple marketing starts from procurement of apple from farmers
up to delivery to the final consumer. A lot of goods and services are involved in
marketing of apple from producer to the final consumer. The motive is to make apple
available to customers in most efficient and profitable manner.
3.5.10 Constraints faced by traders
Constraints faced by the traders were grouped under the following headings
a. Marketing constraints
b. Policy constraints
The constraints were framed with five options against each and Likert scaling
technique was employed to measure the score of each constraint.
3.6 TOOLS OF ANALYSIS
The data collected from primary sources were analyzed in multiple stages.The
collected data were tabulated by using Microsoft excel and is illustrated appropriately to
make meaningful inference. Price spread, producer share in consumer’s rupee,
middlemen’s margin and channel efficiency were calculated by using simple
percentages to arrive at the results. The data were summarized by using simple means
and Likert scaling techniques and were supported by the use of statistical tools like
averages and percentages to obtain meaningful results.
3.6.1 Cost of marketing
The total cost incurred on marketing, in cash or in kind, by the producer-seller

and by various intermediaries involved in the sale and purchase of the commodity till
the commodity reaches the ultimate consumer was computed as follows.
C = Cf +Cm1 + Cm2 + Cm3 + ……….Cmn
Where
C = Total cost of marketing of the commodity.
Cf = Cost paid by the producer from the time, the produce leaves the farm till sale.
Cmn = Cost incurred by nth middleman in the process of buying and selling the
product.
3.6.2 Producer’s share in consumer’s rupee
It is the price received by the producer as a percentage in consumer’s price.
If ((PC) is a consumer’s price and (PF) is the producer’s price then the producer’s
share in consumer’s rupee may be expressed as follows.
Ps = (PF/PC) × 100
3.6.3 Marketing margin of middleman
This is the difference between the total payments (cost + purchase value) and
receipts (sale price) of the middleman (ith agency).
a) Absolute margin of the ith middleman (Ami)
(Ami) = PRi – (Ppi + Cmi)
b) Percentage margin of the ith middleman (Pmi)
PRi – (Ppi + Cmi )

Pmi = ––––––––––––— × 100
PRi
Where,
PRi = Total value of receipts per unit in rupees (sale price).
Ppi = Purchase value of goods per unit in rupees (purchase price).
Cmi = Cost incurred on marketing per unit in rupees.
3.6.4 Analysis of price spread under different channels
It is the difference between the price paid by the consumer and the price received
by the producer. The price spread was worked out by using following method
Price spread = Pp - Pf
Where,
Pp = price paid by the consumer
Pf = price received by the producer
3.6.5 Analysis of marketing efficiency under different channels
Marketing efficiency is a measure of market performance. It is calculated by using

the Shepherd’s formula as follows
ME = [(V/I)-1]
Where,
ME = Index of marketing efficiency
V = Value of goods sold
I = Total marketing cost
3.6.6 Rank Based Quotient
The constraints faced by the producer and marketing intermediaries of apple were
identified. The quantification of data was done by first ranking the constraints based on
the responses obtained and then calculating the Rank Based Quotient (RBQ).
(Sabarathanam, 1988) which is as follows
fi (n+ 1 – i)
R.B.Q. = ————— × 100
N×n
Where,
fi = maximum number of respondents reporting a particular constraint under
ith rank
N= number of respondents
n = number of constraints identified
i = rank of attributes
Chapter IV
RESULTS AND DISCUSSION

In accordance with the pre-determined objectives of the study, data have been
collected and analyzed by using suitable techniques. This chapter deals with the presentation
and discussion of the results emerged from the research work. For easy understanding and
convenience of this chapter, it is presented under the following sub-heads:
4.1 Socio economic characteristics of the respondents
4.2 Identification of supply chain
4.3 Marketing channels, marketing efficiency and price spread of apple
4.4 Problems associated with production and marketing of apple
4.1 SOCIO ECONOMIC CHARACTERISTICS OF THE RESPONDENTS
The socio economic characteristics of the respondents include age group, educational
status, land holdings, type of crop grown, etc. This analysis helps to have a comprehensive
understanding about the socio economic conditions of the respondents so as to execute the
research in a most appropriate manner and make suggestions accordingly.
4.1.1 Educational status of the respondents
The particulars regarding the educational status of the respondents are presented
separately for farmers and traders in Table 4.1. It is observed from the figures that 8 out of 80
farmers were illiterates, which constituted 10 per cent. A total of 26.25 per cent of the
farmers were educated up to class 7th , while 18.75 percent of the farmers are educated up to
class 10th. The number of farmers who completed education up to intermediate and degree
level was 18 each (22.5 per cent).
A total of 5 out of 40 respondent traders were illiterate, while 27.5 per cent of the
traders were inter passed and 17.5 per cent traders were having education up to degree level.
The number of traders who were educated up to 7th class were 9, while total traders who had
education up to class 10th were 8.
Table 4.1 Distribution of the respondents based on educational status
S. No. Education level Farmers Traders

Number Per cent Number Per cent
1 Illiterate 8 10.00 5 12.50
th
2 Up to 7 21 26.25 9 22.50
th th
3 8 to 10 15 18.75 8 20.00
4 Intermediate 18 22.50 11 27.50
5 Degree 18 22.50 7 17.50
Total 80 100 40 100
Thus, among the two categories of farmers and traders under study, the highest per
cent of farmers are having the education up to 7th standard (26.25), while the same was
observed high in intermediate level of traders (27.50 per cent).
4.1.2 Age group of the respondents
It is observed from Table 4.2 that the number of farmers respondents were maximum
in the age group of 41 to 50, constituting about 35 per cent of the total farmers respondents
followed by 25 respondents in the age group of 31 to 40 (31.25 per cent). The farmers
respondents in the age group of 20 to 30 were 17, while in the age group of 51 to 60 there
were 10 respondents.
Table 4.2 Distribution of respondents based on age
S. No. Age group (years) Farmers Traders

Number Per cent Number Percent
1 20-30 17 21.25 8 20
2 31-40 25 31.25 14 35
3 41-50 28 35 13 32.50
4 51-60 10 12.50 5 12.50
Total 80 100 40 100
It is also observed that out of 40 traders / intermediaries respondents, maximum
traders were in the age group of 31 to 40, constituting 35 per cent followed by age group of
41 to 50 with 13 respondents (32.50 per cent). Traders in the age group of 20 to 30 were 8 in
number, while traders in the age group of 51 to 60 were 5 in number.
Among the two groups under study, the highest per cent of farmers were observed
under the age group of 41-50 (35 per cent), while the same is observed in the age group of
31-40 years in traders category. The lowest per cent is recorded in the age group of 51-60
years in both groups of the respondents.
4.1.3 Operational land holdings
The data from Table 4.3 shows that Shopian district had smaller average land holding
of 0.85 ha, while Baramulla has comparatively larger land holding at 0.98 ha. However, the
average land holding of both the districts is very low at 0.915 ha.
Table 4.3 Average land holding of the respondent farmers
S. No. District Average operational land

holding (ha)
1 Shopian 0.85
2 Baramulla 0.98
Overall 0.915
4.1.4 Cropping pattern
It is observed from Table 4.4 that apple monoculture was the most prevalent type of
farming among selected farmers as it earns the highest income to the farmer. A total of 57.5
per cent (46) farmers were cultivating apple only, while farmers cultivating apple and pear
were 15 (18.75 per cent). Farmers cultivating apple and plum were 9 (11.25 per cent),
while apple and other crops cultivated in the orchard were 10 (12.5 per cent).
Table 4.4 Distribution of the farmers based on the crops cultivated
S. No. Crop Number of farmers Per cent
1 Apple 46 57.50
2 Apple and pear 15 18.75
3 Apple and Plum 9 11.25
4 Apple and other crops 10 12.50
Total 80 100.00
4.1.5 Varieties cultivated
Farmers in Kashmir cultivate a lot of varieties of apple in their orchard. Since the
maturity time of different apple varieties are slightly different, it extends the harvesting
season. The most common variety of apple cultivated is Red Delicious followed by Maharaji,
Ambri, American Aperogue etc.
4.1.6 Area of operation of traders
The total 40 respondents involved in supply chain and marketing of apple are
categorized into three groups viz., local, state level and national level, based on their area of
operation. It is evident from Table 4.5 that 18 (45 per cent) traders operate at national level
followed by 12 (30 per cent) and 10 (25 per cent) at local and state level respectively.
Table 4.5 Distribution of traders based on area of operation
S. No. Area of operation Number of Per cent

respondents
1 Local 12 30
2 State level 10 25
3 National level 18 45
Total 40 100.00
4.2 IDENTIFICATION OF SUPPLY CHAIN
4.2.1 Identification of supply chain in apple production
In this section, an attempt has been made to identify the various supply chains
prevailing among apple growing farmers and traders in Jammu and Kashmir state. This
includes input supply to farmers, post harvest management and marketing supply chain of
apple. The data pertaining to it was compiled from primary data collected from different
functionaries.
The supply chain of apple starts from various agri-inputs which a grower uses to
produce apple. There are a lot of inputs and consequently lot of input suppliers in the supply
chain to farmers. These input suppliers either supply directly to the farmer or through
wholesaler or agents in the villages. The various input supply chains identified in apple
production are as follows
Channel I
JKHPMC (planting material)
Wholesaler/ Agent (fertilizer and pesticides) Farmer’s cooperatives Producer
RRB (credit)
Channel II
Private nursery (Planting material)
Retailer (Fertilizer and pesticide) Producer
Credit (Commission agent)
In channel I, Jammu and Kashmir Horticulture Promotion and Marketing Corporation

(JKHPMC) sells planting material to the farmers associations. Farmers association also
purchases fertilizers and pesticides from the wholesaler in bulk while Regional Rural Bank
(RRB) provides the credit. The cooperatives then provide these inputs to the farmers at
reasonable rates.
Channel II shows that producer directly purchases the planting material from private
nursery and village level retailers supply fertilizer and pesticides. Commission agent provides
credit facility to the farmer. Farmer is bound to sell his produce to the commission agent in
this channel. Usually small farmers who can not avail credit from institutional sources avail
this input supply chain.
4.2.2 Cost of inputs in apple production
The total input cost of production of apple is given in Table 4.6. The table denotes
that the cost of plant (Rs. 23044.56 per ha) made the highest value in inputs of apple
production, followed by fertilizer cost (Rs. 11193.93), manure cost (7794.93) etc. The total
input cost for one hectare of apple was amounted to Rs. 49518.07.
Table 4.6 Maintenance cost in apple production
S. No. Cost components Cost Per cent
1 Labour 4496.62 9.74
2 Manure 7494.93 14.61
3 Fertilizer 11193.66 21.61
4 Plant protection 2129.30 6.10
5 Plant 23044.56 44.66
6 Miscellaneous 1559.00 3.04
Total 49518.07 100.00
4.2.3 POST HARVEST MANAGEMENT OF APPLE
Post harvest management of apple
The various activities, generally practiced in post harvest management of apple in selected
area are as given under.
Harvesting of apple
Apple fruits are harvested fully ripe because they do not continue to ripe after harvest.
The fruits for local markets are harvested at fully ripe stage as indicated by the attractive skin
colour while for distant markets, the fruit are harvested when they are crisp and just started
turning red.
The fruits are plucked singly by hand and one or two leaves are left attached to
peduncle to represent freshness. Harvesting is generally done during morning and evening
time to prevent moisture loss from the fruits and increase shelf life.
Grading
The harvested apple are initially placed under shaded area in the orchard on torpelene
sheet where sorting and grading is done. Fruits are rapidly graded, with removal of damaged,
spoiled, insect infested and poor graded fruits, ensuring that fruits are handled carefully and
scratches do not appear on the fruits.
Packaging
Packaging is done mostly in CFB or wooden boxes. The side slits between wooden
strips is kept open at few places for release of respiratory heat. Newspaper strips are placed at
the bottom of the box as well as criss crossing the individual apple to prevent scratches of
fruits. On top of boxes, a layer of apple leaves are used.
Commodity movement
Pre-harvest contractor market over 70 per cent of apple produced in the selected area.
Most pre-harvest contractors are commission agents or wholesale merchants in cities like
Jammu and Delhi. Some of them are financed by wholesale fruits merchants and are obliged
to sell the fruits to their financer. The per-harvest contractor directly supply the commodity to
the wholesaler and export houses located in the area. Some of the export houses directly
purchase the orchards from the growers by making advance payments.
The commission agents and wholesale merchants play a greater role in the distribution
of the produce after purchasing it from pre-harvest contractors. They forward the produce to
big cities in the country. At the terminal markets, agents who operate on commission basis
arrange to sell the produce. The daily arrival at the terminal markets are sold either by auction
or by mutual negotiation.
The fruits packed and forwarded for marketing from Baranulla and Shopian districts
accounts for 75 per cent of the harvested lot. Only the best quality of fruits are selected for
interstate trade while the slightly inferior quality produce is sold in markets within the state.
The premium quality of apple are selected to be marketed in cities like Delhi,
Mumbai, Bengaluru while “A+” grades of apple are mainly marketed in tier 2 cities as
Ahmedabad, Lucknow etc. “A-“ grade of apple are marketed in plains on North India and
Western part of the country.
4.2.4 Identification of supply chain in apple marketing
The various intermediaries involved in supply chain of apple marketing are as follows
A. Channel I: Producer ─ Pre-harvest contractor ─ Commission agent cum wholesaler

─ Retailer ─ Consumer
B. Channel II: Producer ─ Village trader ─ Wholesaler (local) ─ Commission
agent(distant) ─Wholesaler (distant) ─ Retailer (distant) ─ Consumer
C. Channel III: Producer ─ JKHPMC ─ Wholesaler ─ Retailer ─ Consumer
D. Channel IV: Producer ─ Consumer
Apple is made available to the final consumer through these four channels after
production.
Apple growers of the selected areas sell the standing crop to pre-harvest contractors at
flowering stage for a year or two in the month of March - April. The crop contractor negotiate
and settle the price to be paid and terms and conditions of payment directly with the grower.
The pre-harvest contractors have a clear picture of the yield potential of the orchard as a
whole and decide the price of the lease accordingly.
The price offered on a per tree basis varies according to the age category. i.e., a tree in
its prime bearing stage (15 to 25 years) with an annual yield of 100 kg fetches Rs. 1800 per
year from pre-harvest contract, whereas the rate for trees in the early bearing period ( 5 to 14
years) is Rs. 1000 per tree per year. Harvesting of fruits is done by the contractor. The farmer
receives 50 per cent of settled price in advance (at the point of framing of deal) and the rest at
the time of harvest. Loading the truck for transport to distant cities is done at the farm gate
itself.
The pre-harvest contract system prevailing in the study area has an impact on the
health and life of the apple orchard. In case of per-harvest contractor who arrive at “pink bud
stage” of apple tree, it is valid for only that year. In this one year contract, the orchard owner
is responsible for the cultural operations except spray against Apple Scab which is done by
contractor. However, the cost incurred on this account would be deducted by the contractor in
the final settlement.
In case the contract is for 2 to 3 years, though the contractor is responsible for all the
operations, he works with profit motive in mind and does not care about the health of the
orchard as they are not sure of continuing the contract during the next term. Most of such
orchards belong to absentee land lords who are having government jobs and settles in towns.
4.3 MARKETING CHANNELS, MARKETING EFFICIENCY AND PRICE SPREAD
The marketing channel is the chain of intermediaries through whom the products pass from
producer to final consumer.
The following channels were identified in apple marketing in the study area
Channel I: Producer ─ Pre-harvest contractor ─ Commission agent cum wholesaler ─

Retailer ─ Consumer
Channel II: Producer ─ Village trader ─ Wholesaler (local) ─ Commission agent (distant)
─Wholesaler (distant) ─ Retailer (distant) ─ Consumer
Channel III: Producer ─ JKHPMC ─ Wholesaler ─ Retailer ─ Consumer
Channel IV: Producer ─ Consumer
4.3.1 Price spread
4.3.1.1 Price spread in marketing channel - I
As given in Table 4.7, the channel I comprised of Producer ─ Pre-harvest contractor

─ Commission agent (cum wholesaler) ─ Retailer ─ Consumer. The producer price from the
pre-harvest contractor was Rs. 4300 per qtl, which is 39.09 per cent of the consumer rupee.
Table 4.7 Marketing costs, margins and price spread of apple in Channel I
[Producer ─ Pre-harvest contractor ─ Commission agent (cum wholesaler) ─ Retailer ─

Consumer]
S. No. Particulars Rs./q Per cent

share in
consumer’s
rupee
1 Net price received by producer/contractor’s 4300.00 39.09

purchasing price
Cost incurred by pre-harvest contractor 631.40 5.74
A Watch and ward 33.00 0.30
B Picking and grading 124.30 1.13
C Container cost 13.20 0.12
D Transportation cost 66.00 0.60
E Loading/unloading charges 16.50 0.15
F Commission to mediator @ 6 per cent of the 157.40 2.34

producer’s price
G Miscellaneous charges 121.00 1.10
Margin of the pre-harvest contractor 688.00 6.26
2 Pre-harvest contractor sale price/wholesaler 5619.40 51.08

purchase price
Cost incurred by commission agent cum 961.94 8.74

wholesaler
A Market fee @ 2 per cent 121.20 1.02
B Transportation cost 124.30 1.13
C Cost of packing/ repair of boxes 145.20 1.32
D Spoilage/wastage 110.00 1.00
E Commission @ 6 per cent 337.14 3.06

F Miscellaneous charges 133.10 1.21
Commission agent cum Wholesaler margin 1200.10 10.91
3 Wholesaler sale price/Retailer purchase 7780.50 70.73

price
Cost incurred by the retailer 1160.13 10.54
C Cost of packing 80.30 0.73
D Spoilage/wastage 130.90 1.19
Retailer margin 2060.30 18.73
Retailer sale price/consumer purchase price 11,000.00 100.00
PRICE SPREAD 6700.00
The per quintal marketing cost incurred by the pre-harvest contractor includes watch
and ward @ Rs. 33 (0.30 per cent), picking and grading @ Rs.124.3 (1.13 per cent), container
cost at Rs. 13.2 (0.12 per cent), transportation cost @ Rs. 66 (0.60 per cent), loading and
unloading charges at Rs. 16.5 (0.15 per cent), and miscellaneous expenditures of Rs. 121
(1.10 per cent). All these costs together accounted to Rs.631.4 per quintal which constituted
5.74 per cent of consumer’s rupee. The price at which the pre-harvest contractor sold to the
wholesaler was Rs. 5619.4 resulting in a profit margin of Rs. 688 per quintal (6.62 per cent).
The cost incurred by the Commission agent cum wholesaler was Rs. 961.94 per quintal which
includes 2 per cent market fee (Rs. 121.2), 6 per cent commission (Rs. 337.14/q),
transportation costs (Rs.124.3/q), spoilage losses 9(Rs. 110/q), cost of bag and repair of boxes
(Rs. 145.2/q) etc. Subsequently the produce is sold to the retailer at Rs. 7708.5 per quintal, by
including the miscellaneous charges of Rs. 133.1/q (1.21 per cent), leaving a profit margin of
Rs. 1200.1 constituting 10.91 per cent of consumer’s rupee.
The retailer’s expenditure accounted to Rs. 1160.13 per quintal, of which the
commission of 6 per cent accounted to Rs. 446.83/q, transportation cost accounted for Rs.
145.2, spoilage loss was Rs. 130.9. The miscellaneous charges were Rs. 201.3. The retailer
received a margin of Rs. 2060.3 which is 18.73 per cent of the consumer’s rupee.
The total price spread in this channel is Rs. 6700. Of the three intermediaries involved
in the marketing channel I, the retailer’s margin is higher (18.73%) followed by that of
commission agent cum wholesaler (10.91%) and pre-harvest contractor (5.74%). Thus the
total marketing cost accounted to 25.02 per cent of the consumer’s price, while 35.93 per cent
was towards marketing margins by the three intermediaries involved in this channel.
4.3.1.2 Price spread in marketing channel - II
The marketing channel II, comprises of producer, village trader, local wholesaler,
distant commission agent, distant wholesaler, distant retailer and final consumer. The Table
4.8 indicates that the cost incurred by the village trader towards watch and ward was Rs. 18.3
per quintal accounting to 0.10 per cent of consumer’s price. Similarly, the cost of picking and
grading amounted to Rs.75.03 per quintal (0.41 per cent of consumer’s price). The
commission to the mediator who arranged for the contract (@ 8 per cent of the price paid to
the producer) accounted to 1.87 per cent of the consumer’s rupee and miscellaneous charges
account to Rs. 95.16. per quintal. Thus, the total cost incurred by the local trader/contractor
was Rs. 550.79 per quintal which attributes to 3 per cent of the consumer’s rupee. The
produce is sold to local wholesaler at a price of Rs. 5582.79 per quintal by adding his own
margin of Rs. 732 (4 per cent of consumer’s rupee).
The cost incurred by the second functionary in channel II ie., local wholesaler was
Rs. 1348.09 per quintal i.e., 7.36 per cent of the consumer’s rupee. The major components of
local wholesaler expenditures included transportation cost (Rs. 250), spoilage losses
(Rs. 201.3) and commission to the mediator (Rs. 334.96). The margin to the local wholesaler
accounted for Rs. 819.84. The produce was sold to distant commission agent at Rs. 7750.72
per quintal.
Table 4.8 Marketing costs, margins and price spread of apple in Channel II
[Producer ─ Village trader ─ Wholesaler (local) ─ Commission agent (distant)

─Wholesaler (distant) ─ Retailer (distant) ─ Consumer]
S. No. Particulars Rs./q Per cent share

in consumer’s
rupee
1 Net price received by the 4300.00 23.49

producer/contractor’s purchase price
Cost incurred by village trader 550.79 3.00
B Picking and grading 75.03 0.41
C Container cost/packing material 18.40 0.10
D Commission @ 8 per cent 344.00 1.87
E Miscellaneous charges 95.16 0.52
Margin of the contractor 732.00 4.00
2 Commission agent (distant) purchase 5582.79 30.50

price
Cost incurred by wholesaler (local) 1348.09 7.36
A Transportation cost 250.00 1.37
B Packing material 292.80 1.60
C Loading/unloading charges 78.69 0.43
D Spoilage losses 201.30 1.10
F Market fee @ 2 per cent 111.65 0.61
G Miscellaneous charges 78.69 0.43
Margin of the wholesaler(local) 819.84 4.48

3 Commission agent (distant) purchase 7750.72 42.35
price
Cost incurred by commission agent 1226.10 6.70

(distant)
A Container cost 91.50 0.50
C Loading/unloading 76.86 0.42
Margin of commission agent (distant) 797.88 4.36
4 Commission agent sale price/wholesaler 9774.70 53.41

(distant) purchase price
Cost incurred by the wholesaler 2534.08 13.84

(distant)
Margin of the wholesaler (distant) 865.59 4.73
5 Wholesaler (distant) sale price/retailer 13174.37 71.99

purchase price
Cost incurred by the retailer 3343.94 17.71
C Market fee @ 2 per cent 163.48 0.89

Margin of the retailer 1781.69 9.73
Retailer sale price/consumer purchase 18300.00 100

price
PRICE SPREAD 14,000.00
The cost incurred by the distant commission agent accounted to Rs. 1226.10 per
quintal which included transportation cost (Rs. 786.9), packing material cost (Rs. 91.5),
loading and unloading (Rs. 76.86). The distant commission agent got the margin of
Rs. 797.88 per quintal (4.36 per cent of consumer’s rupee) and sold the produce to the distant
wholesaler.
The distant wholesaler’s purchase price was Rs. 9774.70 per quintal. The cost
incurred by the distant wholesaler was Rs. 2534.08, of which major costs incurred were on
spoilage losses (Rs. 984.54/q), transportation (Rs. 225.09), commission (Rs. 684.22),
container cost (126) etc. The margin, which distant wholesaler receives was Rs. 865.59 per
quintal constituting 4.73 per cent of consumer’s rupee. Distant wholesaler sold the apple to
retailer at Rs. 13174.37 per quintal.
The cost incurred by the distant commission agent accounted to Rs. 3343.94 per
quintal which included transportation cost (Rs. 225.09), packing material cost (Rs. 151.89),
spoilage losses (Rs. 1464), commission paid (Rs. 922) etc. The retailer got the margin of
Rs. 1782.63 per quintal (9.74 per cent of consumer’s rupee). The final consumer’s price was
Rs. 18,300 per quintal.
The price spread which shows the difference between price paid by the consumer and
price received by the producer was Rs. 14,000 per quintal in channel II.
4.3.1.3 Price spread in marketing channel - III
Price spread for apple in marketing channel-III is given in Table 4.9. This table
indicates that the net share of producer in consumer’s rupee was 44.19 per cent. The producer
himself does the work of watch and ward. The produce, when ready for harvest, is sold to
Jammu and Kashmir Horticulture Promotion and Marketing Corporation (JKHPMC).
JKHPMC incurred Rs. 99.24 on picking and grading, Rs. 254.92/q on container box,
Rs. 128.43 on transport and unloading. The other miscellaneous charges were Rs. 17.51 and
Rs. 138.166 respectively. The margin for JKHPMC was Rs. 420.33 per quintal which was
4.23 per cent of consumer’s rupee.
The wholesaler purchased apple from JKHPMC at Rs. 5358.76 per quintal and incurred
Rs. 991.09 as total marketing cost, which included spoilage (Rs. 180.97), 6 per cent
commission (Rs. 321.48), 2 per cent market fee (Rs. 107.17), etc. Finally, the wholesaler
retains a margin of Rs. 1235.71 constituting 12.7 per cent of consumer’s money.
JKHPMC incurred Rs. 99.24 on picking and grading, Rs. 254.92/q on container box,
Rs. 128.43 on transport and unloading. The other miscellaneous charges were Rs. 17.51 and
Rs. 138.166 respectively. The margin for JKHPMC was Rs. 420.33 per quintal which was
4.23 per cent of consumer’s rupee.
The wholesaler purchased apple from JKHPMC at Rs. 5358.76 per quintal and incurred
Rs. 991.09 as total marketing cost, which included spoilage (Rs. 180.97), 6 per cent
commission (Rs. 321.48), 2 per cent market fee (Rs. 107.17), etc. Finally, the wholesaler
retains a margin of Rs. 1235.71 constituting 12.7 per cent of consumer’s money.
The retailer paid Rs. 7585.56/q to the wholesaler for one quintal of apple. The retailer
incurs Rs. 1477.51 per quintal which accounted to 15,18 per cent of consumer’s price.
Spoilage costs accounted to Rs. 671.37 followed by commission (7 per cent of price paid to
wholesaler) which amounted to Rs. 375.11, Packing costs of Rs. 127.46, transportation
charges of Rs. 107.03 etc. The margin retained by retailer was 6.87 percent of consumer’s
money which amounted to Rs. 666.93.
The total price spread in this channel was Rs. 5430/q.

Table 4.9 Marketing costs, margins and price spread of apple in Channel III
[Producer ─ JKHPMC ─ Wholesaler ─ Retailer ─ Consumer]
S. No. Particulars Rs./ quintal Per cent

share in
consumer’s
rupee
1 Net price received by the 4300 44.19

producer/JKHPMC purchase price
Cost incurred by JKHPMC 638.43 6.65
A Picking and grading 99.24 1.02
B Container cost 254.92 2.62
C Transportation cost 128.43 1.32
D Loading and unloading 17.51 0.18
E Miscellaneous charges 138.16 1.42
Margin of JKHPMC 420.33 4.23
2 JKHPMC sale price/wholesaler purchase 5358.76 55.07

price
Cost incurred by wholesaler 991.09 10.18
C Packing box repair 71.09 0.73
D Spoilage 180.07 1.86
Wholesaler margin 1235.71 12.7
3 Wholesaler sale price/Retailer purchase 7585.56 77.96

price
Cost incurred by retailer 1477.51 15.18
A Packaging 127.46 1.3
B Transportation 107.03 1.10
C Loading and unloading 68.11 0.70
D Commission @ 7 per cent 375.11 3.85
E Spoilage 671.37 6.90
F Miscellaneous 128.43 1.32
Margin of retailer 666.93 6.85
Retailer sale price/consumer purchase 9730 100

price
PRICE SPREAD 5430
4.1.3.4 Price spread in marketing channel – IV
Price spread of apple in identified marketing channel IV is given in table 4.10. This
table indicates that the net share of the producer in consumer’s rupee was 60.99 per cent. The
cost incurred by the producer was Rs. 695.66 which is 9.86 per cent of consumer’s price. The
margin retained by the producer was Rs. 2054.37/q which is 29.14 per cent of consumer’s
rupee.
The price spread was Rs. 2750/q in channel IV
Though this channel is the most profitable, it is rarely followed by farmers with big land
holdings. Only farmers with small land holdings, that too near to roads and highway follow
this marketing chain to cater to the demands from passengers and tourists.
Table 4.10 Marketing costs, Margins and Price spread of Apple in Channel IV
[Producer ─ Consumer]
S. No. Particulars Rs./quintal Per cent share in

consumer’s
rupee
1 Net price received by the producer 4300 60.99
Cost incurred by the producer 695.66 9.86
B Container cost 166.38 2.36
C Picking and grading 150 2.13
D Transportation charges 47.23 0.67
E Miscellaneous 275.65 3.91
Margin of the producer 2054.37 29.14
Producer sale price/Consumer 7050 100

purchase price
PRICE SPREAD 2750
Thus the above analysis clearly shows that the longer the channel and the number of
intermediaries in the system, bigger is the price spread and the share of producer in
consumer’s rupee declines.
The above results are in accordance with the findings of Bhardawaj et. al. (2014) who
also gave similar results in their study on supply chain efficiency of apple in Azadpur market
in Delhi.
4.3.2 Marketing efficiency
The marketing efficiency of each channel is analysed and presented in Table 4.11
Marketing efficiency index (MEI) represents the effectiveness of a marketing system in
which it operates. The marketing efficiency for channel I, II, III and IV were 0.461, 0.306,
0.79 and 2.56 respectively.
Table 4.11 Marketing efficiency of apple in different channels
(Rs. /qtl)
Particulars Channel I Channel II Channel III Channel IV
Consumer’s price 11000 18300 9730 7050
Total marketing cost (price 6700 14000 5430 2750

spread)
Marketing efficiency 0.641 0.306 0.79 2.56
*Total marketing cost includes marketing cost and profit margin of intermediaries
It is observed from this efficiency index that channel IV was the most efficient one.
This is because channel IV does not involve intermediaries and hence, it is the most efficient
among the four identified channels.
4.4 PROBLEMS IN PRODUCTION AND MARKETING OF APPLE
To identify the problems in production and marketing of apple, producers, pre harvest
contractors, wholesaler, retailers etc. who are the important functionaries involved were
interviewed with the help of the questionnaire. For identification of severity of constraints for
farmers, a total of 20 problems were identified under four sub headings namely a) Production
constraints, b) Marketing constraints, c) Value addition constraints and d) Policy constraints.
For identification of constraints from dealers/intermediaries side, two major heads were listed
as a) Marketing constraints and b) Policy constraints.
The analysis of constraints based on RBQ are presented in Table 4.12 and Table 4.13
for the constraints faced by the farmers and the traders respectively.
The results from Table 4.12 revealed that among the five production constraints,
spurious pesticide and fungicide was found to have an RBQ of 99.98, occupying the first rank
and determines its severity. Lack of technical know-how stood as the second most
problematic constraint with RBQ value of 80.00 followed by reduced area (60.00), lack of
improved varieties (40.00) and problem of timely availability of credit facility (20.00).
Table 4.12 Constraints faced by the farmers
S. No. Constraints Rank R.B.Q. Overall

rank
I II III IV V
1 2 3 4 5 6 7 8 9
I Production constraints
1 Reduced area under apple 0 3 21 16 0 60.00 III

crop
2 Lack of improved 3 5 7 24 1 40.00 IV

varieties
3 Lack of latest technical 2 24 8 4 2 80.00 II

know-how
4 Spurious pesticide and 26 0 4 2 8 99.98 I

fungicides
5 Lack of timely availability 7 6 5 3 19 20.00 V

of credit facility
II Marketing constraints
1 Commission agent 3 9 7 16 5 35.00 IV

monopoly
2 Availability of marketing 0 4 11 5 20 20.50 V

credit
3 Lack of fruit growers co- 2 6 18 6 8 69.21 III

operative marketing
society
4 Too many middle men 28 0 3 5 4 90.01 I

involved in marketing
5 Lack of proper transport 4 22 7 3 4 82.10 II
III Value addition constraints
1 Lack of proper cold 3 9 23 1 4 75.00 III

storage
2 Fewer processing plants 0 2 14 18 6 40.30 IV
3 Lack of proper grading 10 21 5 0 4 90.00 I

4 Lack of packing material 22 7 3 8 0 87.51 II
5 Others 0 6 6 13 15 14.50 V
IV Policy constraints
1 Lack of regulated market 2 13 18 6 1 58.50 III
2 Lack of labelling and trade 7 19 8 0 6 98.00 I

mark
3 Lack of promotion of 3 12 13 14 1 31.00 IV

export
4 Taxation 27 5 0 4 6 97.50 II
5 Others 0 0 0 7 33 23.50 V
Among the five marketing constraints faced by the farmers it is evident from the table
that involvement of too many middlemen was seen as the major marketing constraint faced
by the farmer with an RBQ of 90.01, followed by lack of proper transport (82.1), lack of fruit
growers co-operative marketing society (69.21), commission agent monopoly (35.00) and
availability of marketing credit (20.50).
The analysis of constraints pertaining to value addition by farmers revealed that lack
of proper grading was the major problems as measured by the highest RBQ value of 90.00
followed by lack of packing material coupled with high cost of wooden boxes with a RBQ
value of 87.51, lack of cold storage facility with RBQ value of 75, fewer processing plants
with RBQ value of 40.30, etc.
Of the different policy constraints faced by the farmer, lack of labelling and trade
mark and high taxation on export emerged as the first two major constraints, followed by lack
of regulated market and lack of export promotion.
Among the various marketing constraints faced by traders/intermediaries, it is evident

from Table 4.13 that high transport costs was the main concern for the traders. Traders have
to send the produce mainly up to Azadpur mandi in Delhi which costs a lot. Lack of group
marketing received RBQ value of 92 ranking and came second while lack of market for third
grade apples received RBQ value of 70.5 with third rank.
Table 4.13 Constraints faced by traders
S. No. Constraints Rank R.B.Q. Overall

rank
I II III IV V
1 2 3 4 5 6 7 8 9
I Marketing constraints
1 Lack of group marketing 3 25 7 3 0 92.00 II
2 High transport cost 26 5 4 2 3 97.50 I
3 Lack of future and 3 7 10 20 0 27.00 IV

forward marketing
4 Lack of market for third 7 9 21 0 3 70.50 III

grade apple
5 Others 0 0 5 2 33 19.50 V
II Policy constraints
1 Lack of registered trade 5 9 18 4 4 78.00 III

mark
2 Dual inter-state taxation 21 3 5 7 4 97.50 I
3 Lack of brand promotions 5 18 10 5 3 82.00 II

by the government
4 Lack of transportation 5 6 9 7 12 13.50 V

and storage subsidy
5 Lack of soft loans for 3 5 10 18 4 41.00 IV

cooling vehicles
Lack of future and forward marketing came fourth with RBQ value of 27 and others
stood fifth in list of marketing constraints for traders with RBQ value of 19.5.
Under the policy constraints for traders/intermediaries, they explained dual inter-state
taxation was the foremost policy constraint with RBQ value of 97.5 followed by lack of
brand promotion from the government (RBQ value of 82), lack of registered trademark (RBQ
value of 78), lack of soft loans and lack of transportation and storage subsidy.

Chapter V
SUMMARY AND CONCLUSION
Apple (Malus domestica) is an important temperate fruit of India. India ranks fifth
position in apple producing countries of the world. In India, apple is grown mainly in the
states of Jammu and Kashmir and Himachal Pradesh, which together account for 95.57 per
cent of total apple production in the country with 70.39 per cent of production contributed
from Kashmir region alone.
The demand for apple in the country and abroad is increasing over time. It earns a
sizeable amount of foreign exchange through its export. Inspite of good produce obtained,
without proper marketing, all efforts go in vain. In the light of above facts, it is felt necessary
to conduct a study and examine over the supply chain and marketing channels of apple
besides understanding the problems associated with them.
The study was taken with the following specific objectives
1. To identify the supply chain of apple in Kashmir valley.
2. To identify the marketing channels of apple and assess their marketing efficiency.
3. To analyse the constraints in apple marketing.
Baramulla district stood first in apple producing districts of Jammu and Kashmir state
followed by Shopian district. Hence, these two districts were selected purposefully for the
present study. Finally a sample of 80 farmers and 40 traders were selected randomly for data
collection. The data used were collected through personal interview of selected apple growers
and marketing intermediaries with the help of separate pretested questionnaire. The data on
various supply chains prevailing in production and marketing, price paid and received, cost
incurred, marketing margins along with the constraints faced were collected from the market
functionaries. The data collected were analysed with appropriate statistical tools and
techniques.
5.1 MAJOR FINDINGS OF THE STUDY
¾ The data on educational status of farmers and traders revealed that the highest per cent
of farmers were educated up to 7th standard (26.25), while the highest per cent of
traders were educated up to intermediate level (27.50).
¾ The age group analysis of the respondents revealed that maximum number of farmers
(35 per cent) fall under the age group of 41-50, while that of traders fall under the age
group of 31-40 (35 per cent).
¾ The average operational holding of the selected farmers was very low at 0.195 ha.
¾ The analysis of cropping pattern in the study area revealed that majority of the
farmers (46) were cultivating mono cropping of apple followed by apple and pear
inter cultivation with 15 farmers.
¾ The most predominantly cultivated varieties of apple included Red Delicious,
Maharaji, Ambri, American Apirogue, etc.
¾ Out of the forty selected traders for the study, 18 traders were operating at national
level followed by 12 at local level and 10 traders at state level.
¾ Supply chain identified in apple production includes all those intermediaries who help
in apple production and marketing. The main source of credit to farmers were RRBs
and commission agents.
¾ The four important channels of marketing identified in the study are:
I. Channel I: Producer ─ Pre-harvest contractor ─ Commission agent cum
wholesaler ─ Retailer ─ Consumer
II. Channel II: Producer ─ Village trader ─ Wholesaler (local) ─ Commission
agent (distant) ─Wholesaler (distant) ─ Retailer (distant) ─ Consumer
III. Channel III: Producer ─ JKHPMC ─ Wholesaler ─ Retailer ─ Consumer
IV. Channel IV: Producer ─ Consumer
¾ The price spread worked out for four marketing channels was Rs. 6,700/q,
Rs. 14,000/q, Rs. 5,430/q and Rs. 2,750/q.
¾ The producer’s share in consumer rupee was 39.10%, 23.49%, 44.19 % and 60.99%
respectively in channel I, II, III, and IV.
¾ The marketing efficiency also ranged from 0.306 in channel II to 2.56 in channel IV.
¾ The constraints analysis of farmers revealed that spurious pesticides and fungicides,
involvement of too many middlemen, inadequate grading facilities and lack of
labelling and trademark ranked as the highest among the constraints identified under
production, marketing, value addition and policy aspects respectively.
¾ The traders expressed that high transport cost and dual inter-state taxation were the
major constraints under marketing and policy aspects respectively.
5.2 CONCLUSION
• The forward and backward supply chain of apple needs to be strengthened by

identifying the ideal source of supply and delivery of various resources and
products.
• The marketing costs could be decreased by identifying a suitable channel for
supply of apple to distant markets, for which co-operative marketing is considered
the best.
• The marketing efficiency could be increased by reducing the number of market
functionaries and also reducing the marketing costs and margins imposed by each
one of them
• Measures should be taken up to attend major problems identified in the study,
which include spurious pesticide menace, large number of intermediaries, lack of
proper grading, lack of labelling and trademark, high transportation charges and
dual inter-state taxation.
5.3 SUGGESTIONS AND POLICY IMPLICATIONS
1. The pre-production supply chain should be more organised to facilitate the grower to
purchase inputs at a reasonable rate and at a convenient place for which co-operative
societies need to be encouraged to supply all the required inputs at one place.
2. It is suggested that the farmers can form producers association and collectively market
the produce more on co-operative lines to minimize the price spread.
3. The marketing regulations need be strengthened to reduce the number of
intermediaries and also the commission paid at various levels.
4. Adequate and timely information about the market arrivals, price prevailing etc. will
help in forecasting the demand in different markets.
5. Marketing infrastructure such as access to market yards, better transport facilities,
timely credit availability, provision of cold storage facilities etc. will help in facing
the marketing risks and improve the socio-economic conditions of the producer and
trader.
6. Since the market rate of apple fluctuates, there should be a minimum price fixed (per
kg. or per Box) by the government so that growers will at least be sure of the
minimum returns.
7. Since apple export has great potential from J&K state, it should be given the status of
an industry to promote export earning and widen the market.
8. Quality labelling and trademark should be promoted to fetch the premium price in the
market.
9. A one-time taxation on weight basis of apple should be charged by transportation
department to avoid the problem of dual inter-state taxation.
LITERATURE CITED
Acharya, S. S. and N. L. Agarwal. 1987. Production and Marketing of Apples. Mittal

Publications. 78-104.
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STUDY OF SUPPLY CHAIN

MANAGEMENT AND MARKETING OF

MASTER OF BUSINESS ADMINISTRATION

PROJECT REPORT SUBMITTED TO PROFESSOR JAYASHANKAR TELANGANA

MASTER OF BUSINESS ADMINISTRATION

SCHOOL OF AGRIBUSINESS MANAGEMENT

Project report approved by the Student Advisory Committee

Chairperson : Dr. Y. Radha

Member : Dr. Seema

Member : Shri M.H.V.Bhave

Date of final viva- voce

I, SARFARAZ ASGHAR, hereby declare that the project report “STUDY OF

Place: Hyderabad (SARFARAZ ASGHAR)

Chapter No . Title Page No.

III MATERIAL AND METHODS

IV RESULTS AND DISCUUSSION

V SUMMARY AND CONCLUSION

et al. : and other people

J&K : Jammu and Kashmir

JKHPMC : Jammu and Kashmir Horticulture Planning and

RBQ : Rank Based Quotient

RRBs : Regional Rural Banks

S. No. : serial number

Date: SARFARAZ ASGHAR

Place: Hyderabad (AUTHOR )

STUDY OF SUPPLY CHAIN MANAGEMENT AND MARKETING

DEGREE : MBA (ABM)

DEPARTMENT : SCHOOL OF AGRIBUSINESS MANAGEMENT

CHAIRPERSON : Dr. Y. RADHA

PROFESSOR JAYSHANKAR TELANGANA

¾ Channel I: Producer ─ Pre-harvest contractor ─ Commission agent cum wholesaler

The study suggested an overall improvement in providing market information, quality of

Marketing is a comprehensive function; it is concerned with every aspect of the produce

1.2 APPLE PRODUCTION IN INDIA

S. No. Country Quantity (kg) Value (Rs.)

1 Bangladesh 3,07,01,908 63,75,97,571

2 Nepal 49,14,306 18,63,06,570

3 Sri Lanka 4,44,316 3,44,90,521

4 United Arab Emirates 30,607 34,16,895

5 Saudi Arabia 420 14,761

Total 3,60,98,057 86,23,76,795

Source: DGCIS Annual Export 2014

Fig 1..2 Apple prooduction in major statees of India

1.3 HISTORY OF APPLE IN KASHMIR

Till 1945, there was no clear identification of scientific nomenclature and

1.4 STATUS OF APPLE PRODUCTION AND MARKETING IN JAMMU AND

Supply chain in apple production comprises of vast network of input suppliers,

The sale through pre-harvest contractor is the most important system of

1.5 OBJECTIVES OF INVESTIGATION

1. To identify the supply chain of apple in Kashmir valley.

3. To analyse the constraints in apple marketing.

1.6 SCOPE OF THE STUDY

1.7 LIMITATIONS OF THE STUDY

1.8 STRUCTURE OF THE REPORT

The study is presented in six chapters as follows

2.1 Supply chain analysis of fruits and vegetables

2.1 Supply chain analysis of fruits and vegetables

Negiet al.(2014)highlighted the need and importance of efficient supply chain to

NavitaMahajan(2013) in her study points towards the importance of cold storage in

Nityanand and Prachee (2011) observed that the supply-chain management of

Lokollo (2004) studied on cooperative marketing of fruits and found it to be highly

Seyed-Mahmoud Aghazadeh (2004) in his paper explores ways of improving logistics

2.2 Marketing channels and marketing efficiency of fruits and vegetables