Farmers get up to 50 pc better pricing from supermarket chain
Farmers in India and other developing countries stand to gain up to 50 pc more when they sell their produce to supermarkets, where consumers also get the products at a much cheaper price compared to traditional retail shops.
NEW DELHI: Farmers in India and other developing countries stand to gain up to 50 pc more when they sell their produce to supermarkets, where consumers also get the products at a much cheaper price compared to traditional retail shops, a new study says.
"When farmers enter supermarket channels, they tend to earn from 20 to 50 pc more in net terms," an International Food Policy Research Institute (IFPRI) study found.
The study, conducted by IFPRI's Asia Director Ashok Gulati and a Michigan State University professor Thomas Reardon, added that food price savings from supermarkets first accrue to the middle class, but as supermarkets spread into the food markets of the urban poor and into rural towns, the benefits are extended to poor consumers also.
"For example, in Delhi, India, the basic foods of the urban poor are cheaper in supermarkets than in traditional retail shops," the study said, adding rice and wheat are 15 per cent cheaper and vegetables 33 pcless costly there.
In most countries supermarkets offer lower prices first in the processed and semi-processed food segments, it said. However, farmers can earn from supermarket chains provided they make more up-front investment and meet greater demands for quality, consistency and volume compared with marketing to traditional markets, the study pointed out.
Pointing supermarket revolution as 'two-edged sword', the study suggested that it is important for governments of developing-countries to build policies and make investments that prepare farmers and retailers to face the challenges and meet the requirements of the modernised food markets.
"When farmers enter supermarket channels, they tend to earn from 20 to 50 pc more in net terms," an International Food Policy Research Institute (IFPRI) study found.
The study, conducted by IFPRI's Asia Director Ashok Gulati and a Michigan State University professor Thomas Reardon, added that food price savings from supermarkets first accrue to the middle class, but as supermarkets spread into the food markets of the urban poor and into rural towns, the benefits are extended to poor consumers also.
"For example, in Delhi, India, the basic foods of the urban poor are cheaper in supermarkets than in traditional retail shops," the study said, adding rice and wheat are 15 per cent cheaper and vegetables 33 pcless costly there.
In most countries supermarkets offer lower prices first in the processed and semi-processed food segments, it said. However, farmers can earn from supermarket chains provided they make more up-front investment and meet greater demands for quality, consistency and volume compared with marketing to traditional markets, the study pointed out.
Pointing supermarket revolution as 'two-edged sword', the study suggested that it is important for governments of developing-countries to build policies and make investments that prepare farmers and retailers to face the challenges and meet the requirements of the modernised food markets.
Download
The Economic Times Business News App for the Latest News in Business, Sensex, Stock Market Updates & More.
The Economic Times Business News App for the Latest News in Business, Sensex, Stock Market Updates & More.
Download
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
ADVERTISEMENT
