Maize

Marketing

Introduction Marketing Channels

Introduction

  • Farm Product marketing, as it has evolved in our expanding economy represents and increasing the complex and ever widening breech between the farmer and his ultimate customer. It is a necessary specialisation trend and efficiency condition in the continuing attainment of a more abundant economy. Few basic economic concepts help to understand the role of marketing and how the system links farmers until their ultimate customers.
  • A consumer pays for utility in goods and services, that which satisfies his wants and needs. The guiding purpose of economic activity is to produce utility. For convenience it is differentiated into four types.

Form Utility

  • The process that converts materials into a more useful form produces form utility. On the farm such resources as seed, plant nutrients, rainfall, cultivation and labour are combined to produce corn. Other examples are the processes whereby cream is changed into butter, corn milled into flour, and flour is changed to bread. Farmers, millers and bakers produce form utility.

Time Utility

  • Operations that supply goods more timely to their needs enhance their usefulness. Corn is stored and held from the harvest season, where it has less value because of market gluts, to a later time when it has greater value.
  • Grain elevator and storage firms produce time utility.

Place Utility

  • Agencies the transport grain from an area where there is a surplus or too few users to a place where more is wanted increase its usefulness.

Possession Utility

  • Each party to a transaction in which goods or services change hands gives up something that has less value, and gains some thing that has more value, to him.
  • This condition motivates sales and trades. The livestock auction and the grain exchange are establishments that bring buyers and sellers together and provide for efficient production of possession utility.
  • The price the final user pays for corn or its products represents its total value to him. The total value is a composite derived from its form time, place and possession utilities.

The marketing system performs the dual role of

  • Providing products to users when, where and in what form they want and
  • Reflecting the users desires for kind and quality through the complex marketing system to the farmer. The pricing system is the means whereby the consumer registers what he is willing to pay for different kinds and qualities and the farmer registers what price will induce him to produce and market the different kinds and qualities of products. Both the farmer and those who assemble, store, process, transport and sell his product stand to benefit by coordinating their efforts to efficiently provide the desired products to the final consumer when, where and in the form he wants, for which he is willing to pay the necessary price.
  • Over 3/4th of total corn production was used on farms where produced during 1950. More than 1/2 moved into marketing channels in the recent years. The proportion moving to market continues to increase.

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Marketing Channels

  • 4/5th of off form sales went to country elevations. A small amount was sold locally to other farmers and small quantities moved directly to terminal and sub terminal elevators, to terminal and post marketing agencies and to government storage.
  • Most corn shipments from country elevators went to sub terminal, terminal and post elevators and markets. However, over 1/5th was sold back to local farmers and feeders.
  • Almost 1/10th was mixed and sold as prepared animal feed and a small amount is moved to feed manufacturers.
  • Terminal and post agencies that operate without storage facilities received and handled a sizable proportion (1/4th) of the corn that moved through the marketing channels.
  • However, about 1/3rd of grain moved into terminal or sub terminal elevations before going to processers and into final use.
  • Slightly less than 1/2 the corn that passed through terminal elevators and post marketing agencies went to feed manufacturers, 31% was exported, and 23% went to wet process and dry process millers of food and industrial products.
  • Feed manufacturers required 21 million tonns from terminal markets and a small amount from country elevators.
  • Over 1/2 the corn used as feed grown and fed on farms where produced. 11.3 million tonns go only to the local elevator before moving back to the farm where it is used and small amount is sold out directly to the local farmers.
  • The 26.7 million tonns does not account for all the corn that was mixed into prepared feeds before feeding.

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Telangana