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Agricultural Economics Research ReviewVol. 23 (Conference Number) 2010 pp 495-504<strong>Lessons</strong> <strong>from</strong> <strong>Innovative</strong> <strong>Institutions</strong> <strong>in</strong> <strong>the</strong> Market<strong>in</strong>g ofFish and Fishery Products <strong>in</strong> India §B. Ganesh Kumar* a , T. Ravisankar b , R. Suresh c , Ramachandra Bhatta d ,D. Deboral Vimala b , M. Kumaran b , P. Mahalakshmi b and T. Sivasakthi Devi aaNational Centre for Agricultural Economics and Policy Research, New Delhi – 110 012bCentral Institute of Brackishwater Aqauculture, Chennai – 600 028cFisheries College & Research Institute, Thoothukudi – 628 008dCollege of Fisheries, Mangalore – 575 002AbstractThis study has been conducted with <strong>the</strong> objective of understand<strong>in</strong>g <strong>the</strong> process of <strong>in</strong>novative market<strong>in</strong>gmodels <strong>in</strong> <strong>the</strong> fisheries sector and to draw lessons <strong>from</strong> <strong>the</strong> success stories to upscale and replicate <strong>in</strong> asimilar socio-politico-economic scenario <strong>in</strong> o<strong>the</strong>r parts of <strong>the</strong> country. It has been conducted to provide abetter understand<strong>in</strong>g of fish market<strong>in</strong>g by self-help groups (SHGs), producer associations, fisheriesdevelopment corporations, fisherman cooperatives and private <strong>in</strong>stitutions <strong>in</strong> <strong>the</strong> sou<strong>the</strong>rn states of India,namely Tamil Nadu, Kerala, Karnataka and Andhra Pradesh with <strong>the</strong> hypo<strong>the</strong>sis that <strong>the</strong> <strong>in</strong>stitutionalarrangements <strong>in</strong> <strong>the</strong> market<strong>in</strong>g of fish and fishery products reduce <strong>the</strong> transaction cost and improve <strong>the</strong>market access and its efficiency. The study has reported <strong>the</strong> primary activities of those <strong>in</strong>stitutions <strong>in</strong> <strong>the</strong>efficient fish market<strong>in</strong>g, such as <strong>in</strong>bound logistics, operations, outbound logistics, market<strong>in</strong>g and salespromotion and support activities like <strong>in</strong>frastructural facilities, technological backstopp<strong>in</strong>g, price <strong>in</strong>formationand procurement. Through <strong>the</strong>se advantages, <strong>the</strong> fishermen have been found to achieve economies ofscale, technological <strong>in</strong>novations, capacity development, l<strong>in</strong>kage among activities, degree of vertical<strong>in</strong>tegration, tim<strong>in</strong>g of market entry, product differentiation, market access, credit access, etc. The study hassuggested replication of such successful <strong>in</strong>novative <strong>in</strong>stitutions <strong>in</strong> market<strong>in</strong>g <strong>the</strong> fish and fishery productsthrough appropriate policies and programmes. It has also suggested to promote <strong>in</strong>stitutions like SHGs,producer / fishermen associations, cooperatives, etc. and allow <strong>the</strong> entry of private agencies with appropriateregulatory mechanism to improve <strong>the</strong> efficiency of fish market<strong>in</strong>g <strong>in</strong> <strong>the</strong> country.IntroductionFish is one of <strong>the</strong> highly perishable commoditiesand it occupies a very important place <strong>in</strong> <strong>the</strong> socioeconomicdevelopment of <strong>the</strong> country. The fisherysector contributes to <strong>the</strong> livelihood of a large section ofeconomically underprivileged population <strong>in</strong> India(Ayyappan and Krishnan, 2004). While <strong>the</strong> demand of* Author for correspondence,Email: drgankum@yahoo.com§This paper is drawn <strong>from</strong> <strong>the</strong> f<strong>in</strong>al report of <strong>the</strong> researchstudy on ‘Explor<strong>in</strong>g market opportunities for fisheriessector <strong>in</strong> India’ sponsored by National FisheriesDevelopment Board, Hyderabad.fish and fishery products is steadily grow<strong>in</strong>g and is fairlyuniform across <strong>the</strong> country, <strong>the</strong> supply of fish is highlyseasonal and it comes <strong>from</strong> diverse productionenvironment, lead<strong>in</strong>g to price fluctuations across regionsand seasons, and even with<strong>in</strong> <strong>the</strong> day, which is exploitedby <strong>the</strong> middlemen, result<strong>in</strong>g <strong>in</strong> reduced welfare offishermen. Gupta (1984) and Srivastava and Kant(1985) had analyzed <strong>the</strong> price variations among <strong>the</strong>fish species across states and had identified<strong>in</strong>frastructural bottlenecks <strong>in</strong> efficient market<strong>in</strong>g systemof India. The system of fish market<strong>in</strong>g <strong>in</strong> India hastraditionally been highly unorganized and unregulated,which is <strong>the</strong> prime cause of <strong>in</strong>efficiency <strong>in</strong> <strong>the</strong> wholeprocess. Attempts have been made to overcome this


496 Agricultural Economics Research Review Vol. 23 (Conference Number) 2010perennial problem by fishermen group as well asgovernment agencies <strong>in</strong> some pockets of our country.In general, <strong>the</strong> fishermen could be saved <strong>from</strong>exploitation by encourag<strong>in</strong>g group market<strong>in</strong>g,cooperative market<strong>in</strong>g, contract market<strong>in</strong>g, etc., whichwould <strong>in</strong>crease <strong>the</strong> market<strong>in</strong>g efficiency and improve<strong>the</strong>ir profit (Chahal et al., 2004; Ali et al.,2008). But,<strong>the</strong>se k<strong>in</strong>ds of efforts have largely been conf<strong>in</strong>ed to afew small locations cover<strong>in</strong>g few species and werehighly scattered. Unlike poultry or dairy <strong>in</strong>dustry,<strong>in</strong>novations <strong>in</strong> fish market<strong>in</strong>g have not been on a macrolevel.Katiha et al. (2004) have studied <strong>the</strong> governance,<strong>in</strong>stitutions and policies for fisheries of floodpla<strong>in</strong>wetlands, where<strong>in</strong> <strong>the</strong>y revealed that <strong>the</strong> stakeholders<strong>in</strong>clude fishers, government agencies, lessee, fisheryco-operatives, village authority, community leaders,market agents, political leaders and NGOs and <strong>the</strong>ir<strong>in</strong>teractions and transparency are essential to <strong>in</strong>crease<strong>the</strong> efficiency of <strong>the</strong> markets. Acharya (1997) hadsuggested encourag<strong>in</strong>g <strong>the</strong> local farmers, traders andprocessors to market <strong>the</strong> produce under <strong>the</strong>ir brandsand promot<strong>in</strong>g such local brands based on gradedproduce to improve <strong>the</strong> market<strong>in</strong>g efficiency. Similarly,Punhani (2001) has emphasized that an efficientmarket<strong>in</strong>g system <strong>in</strong> horticultural products could beachieved through price stability, rapid economic growthand equitable distribution of goods and services.Under this background, this paper has attemptedto document and understand <strong>the</strong> process of differentk<strong>in</strong>ds of <strong>in</strong>novative market<strong>in</strong>g models <strong>in</strong> <strong>the</strong> fisheriessector and to draw lessons <strong>from</strong> <strong>the</strong> success stories toupscale and replicate <strong>in</strong> a similar socio-politicoeconomicscenario <strong>in</strong> o<strong>the</strong>r parts of <strong>the</strong> country. Thisstudy was conducted to have a better understand<strong>in</strong>g offish market<strong>in</strong>g by self-help groups (SHGs), producerassociations, fisheries development corporations,fisherman cooperatives and private <strong>in</strong>stitutions.Recommendations to improve fish market<strong>in</strong>g by <strong>the</strong>organized sectors <strong>in</strong> India have been provided and policyimplications have been discussed.Hypo<strong>the</strong>sis, Methodology and DataThe study was formulated to test <strong>the</strong> hypo<strong>the</strong>sisthat <strong>the</strong> <strong>in</strong>stitutional arrangements <strong>in</strong> <strong>the</strong> market<strong>in</strong>g offish and fishery products would reduce <strong>the</strong> transactioncost and improve <strong>the</strong> market access and its efficiency.Product differentiation would <strong>in</strong>duce <strong>the</strong> consumptionof fish through which <strong>the</strong> producer could earn moreprofit. There would be a positive impact on fishermen’sprofitability by <strong>the</strong> improved credit access and consumerpreference. We expect that <strong>the</strong> <strong>in</strong>come and livelihoodstatus of fishermen would be improved by sell<strong>in</strong>g fishand fishery products through SHGs, fishermanassociations, co-operatives and private <strong>in</strong>stitutions. Thiswould improve <strong>the</strong> market<strong>in</strong>g efficiency, its distributionchannel and <strong>the</strong> storage method by which <strong>the</strong> fishermencould reduce <strong>the</strong> wastage/ spoilage of fish and fisheryproducts. Besides, susta<strong>in</strong>able technology <strong>in</strong> <strong>the</strong>production, process<strong>in</strong>g and differentiat<strong>in</strong>g <strong>the</strong> qualityof fish and fishery products would provide more profitto fishermen.The study is based on <strong>the</strong> <strong>in</strong>formation collectedthrough personal <strong>in</strong>terview and formal techniques suchas participatory rural appraisal and focused groupdiscussions carried out <strong>in</strong> <strong>the</strong> sou<strong>the</strong>rn states of India,namely Tamil Nadu, Kerala, Karnataka and AndhraPradesh. The <strong>in</strong>formation on <strong>the</strong> genesis, structure,conduct, performance and benefits of such <strong>in</strong>novative<strong>in</strong>stitutions was collected <strong>from</strong> <strong>the</strong> well organized,selected market<strong>in</strong>g <strong>in</strong>stitutions, namely Thenkumari SelfHelp Group, Chennai, Tamil Nadu; Sagar NidhiEnterprise Activity Group, Mangalore, Karnataka;Pam<strong>in</strong>iaru Shrimp Farmers’ Association, Thambikkotai,Tamil Nadu; Mar<strong>in</strong>e Fish Market<strong>in</strong>g by FishermenAssociations, Kombuthurai, Tamil Nadu; <strong>the</strong> stategovernment market<strong>in</strong>g agencies like Tamil NaduFisheries Development Corporation Ltd. (TNFDC),Kerala State Cooperative Federation for FisheriesDevelopment Ltd. (Matsyafed); and also a private<strong>in</strong>stitution, named Aquachoupal <strong>in</strong> Andhra Pradesh.Results and Discussion(i) Market<strong>in</strong>g by Self-help GroupsWomen play several critical roles <strong>in</strong> fisheries,particularly dur<strong>in</strong>g <strong>the</strong> pre- and post-harvest sectors.In <strong>the</strong> mar<strong>in</strong>e fisheries, active mar<strong>in</strong>e fish<strong>in</strong>g is generallyundertaken by men, although a small percentage ofwomen also takes part <strong>in</strong> near-shore fish<strong>in</strong>g, seaweedharvest<strong>in</strong>g, and <strong>in</strong> <strong>the</strong> collection of clams, mussels andbivalves. Accord<strong>in</strong>g to <strong>the</strong> Mar<strong>in</strong>e Fisheries Census,2005, <strong>the</strong> total mar<strong>in</strong>e fisherfolk population of n<strong>in</strong>ecoastal states and two union territories <strong>in</strong> ma<strong>in</strong>land Indiawas 3,519,116. Notably, of <strong>the</strong> 756,391 fisherfolk<strong>in</strong>volved <strong>in</strong> fish<strong>in</strong>g-related activities, 365,463 are women(approximately 48%), with 152,692 of <strong>the</strong>m engaged


Ganesh Kumar et al. : <strong>Lessons</strong> <strong>from</strong> <strong>Innovative</strong> <strong>Institutions</strong> <strong>in</strong> <strong>the</strong> Market<strong>in</strong>g of Fish <strong>in</strong> India 497<strong>in</strong> <strong>the</strong> market<strong>in</strong>g of fish, compared to 54,670 men.Women are <strong>the</strong> primary players <strong>in</strong> process<strong>in</strong>g, market<strong>in</strong>gand sell<strong>in</strong>g <strong>the</strong> catch. Thus, women vendors andprocessors have organized <strong>the</strong>mselves <strong>in</strong> formal and<strong>in</strong>formal groups to facilitate <strong>the</strong>ir trade. Among <strong>the</strong>se,<strong>the</strong> self-help groups (SHGs) are <strong>the</strong> formalorganizations by which <strong>the</strong>y sell <strong>the</strong>ir fish and fisheryproducts (Kumar, 2010). The present study is focusedon two SHGs namely Thenkumari Self Help Group,Chennai, Tamil Nadu; and Sagar Nidhi EnterpriseActivity Group, Mangalore, Karnataka. These groupsare engaged <strong>in</strong> <strong>the</strong> market<strong>in</strong>g of fresh fish products.Thenkumari SHG was organized <strong>in</strong> 2003 with 15members that rema<strong>in</strong>ed engaged <strong>in</strong> fish market<strong>in</strong>g forabout 4 to 14 hours a day and 5 to 7 days <strong>in</strong> a week. Inaddition, <strong>the</strong> women also used to procure fish <strong>from</strong>auction through group purchase at Ch<strong>in</strong>dadiripet FishMarket at Chennai. This SHG undertook a pilot projectto supply fresh seafood to a key customer (TajCoromandal — a premier 5 star hotel) at Chennai on acontract basis. The Taj Coromandal emphasized on <strong>the</strong>supply of high quality products and timely delivery andaccord<strong>in</strong>gly, <strong>the</strong> fisherwomen <strong>in</strong> Thenkumari SHGwere tra<strong>in</strong>ed on <strong>the</strong>se issues. The produce supplied bythis SHG passes through str<strong>in</strong>gent quality parametersto meet <strong>the</strong> expectations of Taj customers. The SHGwas supply<strong>in</strong>g 2 kg <strong>in</strong>itially thrice a week, which<strong>in</strong>creased to 500 kg per month <strong>in</strong> 2008. In recognitionof its quality service, <strong>the</strong> Taj management gave <strong>the</strong>‘Best Vendor Award’ for <strong>the</strong> year 2008 to <strong>the</strong>Thenkumari SHG. This project has been a w<strong>in</strong>-w<strong>in</strong>situation for both <strong>the</strong> producer and <strong>the</strong> consumer. Thehotels get quality products directly <strong>from</strong> <strong>the</strong> SHG and<strong>the</strong> SHG has been able to susta<strong>in</strong> its bus<strong>in</strong>ess. As aresult, this group has been gett<strong>in</strong>g credit support <strong>from</strong>Indian Bank, Chennai. The bank has also confirmedthat <strong>the</strong> repayment record of <strong>the</strong> SHG has been almost100 per cent for which <strong>the</strong> SHG was awarded <strong>the</strong>‘SHG Bank L<strong>in</strong>kage Programme State Level Awardfor 2006-07’ for timely repayments. Concurrent loans<strong>from</strong> <strong>the</strong> same branch were <strong>in</strong>creased <strong>from</strong> Rs 70,000to Rs 3,00,000 (Table 1).Ano<strong>the</strong>r group, named ‘Sagar Nidhi’ is a self-helpenterprise activity group and was formed by mobiliz<strong>in</strong>gfresh-fish retailers of Bengare ward of Mangalore Port<strong>in</strong> August 2006. The group members were first enrolledas members of <strong>the</strong> Karavali Fisher’s Process<strong>in</strong>g andMarket<strong>in</strong>g Cooperative Society Ltd. and were providedwith f<strong>in</strong>ancial and technical assistance. Some of <strong>the</strong>developmental options discussed with women groupswere direct supply of high- value fishes to hotels andrestaurants, <strong>in</strong>vestment requirements for trad<strong>in</strong>g highvaluefishes and open<strong>in</strong>g of a retail shop deal<strong>in</strong>g withfishes harvested by follow<strong>in</strong>g eco-friendly fish<strong>in</strong>gpractices and o<strong>the</strong>r susta<strong>in</strong>able practices like avoid<strong>in</strong>gjuvenile fishes, gillnet fishes, etc. F<strong>in</strong>ally, <strong>the</strong> groupagreed for sett<strong>in</strong>g up of a retail workshop by employ<strong>in</strong>gunemployed girls to market <strong>the</strong> harvested fish andfishery products. The women retailers have beenbenefited <strong>in</strong> two ways such that <strong>the</strong>y were able toparticipate directly <strong>in</strong> <strong>the</strong> auction market and thus saved20-30 per cent <strong>in</strong> <strong>the</strong> purchase price, and <strong>the</strong>y wereable to <strong>in</strong>crease <strong>the</strong>ir sales <strong>from</strong> one basket (15 kg) totwo baskets (30-35 kg) per day and net earn<strong>in</strong>gs <strong>from</strong>Rs 100 to Rs 150-175 per day.(ii) Market<strong>in</strong>g by Producer AssociationsThe study has focused on two such <strong>in</strong>stitutions,namely Pam<strong>in</strong>iaru Shrimp Farmers’ Association,Thambikkotai and Mar<strong>in</strong>e Fish Market<strong>in</strong>g by FishermenAssociations, Kombuthurai, both <strong>in</strong> Tamil Nadu.Table 1. Impact of Thenkumari SHG on <strong>the</strong> fisherwomenParameters Year2003 2008Quantity supplied per month 24 kg 500 kgPlace of market<strong>in</strong>g Traditional retail fish markets of Chennai Hotel Taj Coromandel,Chennai – A 5-star hotelType of product Fresh fish Processed high quality fishLevel of skill <strong>in</strong> process<strong>in</strong>g Low HighCredit support Local money lender with high <strong>in</strong>terest rate Nationalized bank with low<strong>in</strong>terest rateLoan sanctioned <strong>from</strong> bank Rs 70,000 Rs 3,00,000


498 Agricultural Economics Research Review Vol. 23 (Conference Number) 2010An <strong>in</strong>novative model of collective market<strong>in</strong>g of ashrimp farmers’ association <strong>in</strong> <strong>the</strong> Thambikottai villageof Tiruvarur district was formed by <strong>the</strong> aquafarmers<strong>the</strong>mselves <strong>in</strong> <strong>the</strong> year 2003, ma<strong>in</strong>ly to prevent andmanage collectively <strong>the</strong> disease outbreaks <strong>in</strong> <strong>the</strong> clusterby enforc<strong>in</strong>g better management practices. Initially, itstarted with just 5 farms (35 ponds) and has now grown<strong>in</strong>to 50 farms (320 ponds) today. To market <strong>the</strong>ircultured shrimp, <strong>the</strong> association calls for quotations <strong>from</strong>buyers and negotiates with <strong>the</strong>m for fix<strong>in</strong>g a price for<strong>the</strong> total shrimp produced <strong>in</strong> <strong>the</strong> cluster. However, thatprice is not a b<strong>in</strong>d<strong>in</strong>g and any <strong>in</strong>dividual member cannegotiate with <strong>the</strong> buyer for a higher price. A stampedagreement is signed between <strong>the</strong> farmer and <strong>the</strong> buyer.It is <strong>the</strong>n given to <strong>the</strong> association by <strong>the</strong> farmersmention<strong>in</strong>g <strong>the</strong> agreed amount (per kg of shrimp sold)to be deducted at buyer’s office towards <strong>the</strong> associationfund to compensate <strong>the</strong> affected farmers and manage<strong>the</strong> common resources. It is <strong>the</strong> responsibility of <strong>the</strong>buyer to ensure <strong>the</strong> payment of this amount to <strong>the</strong>association, which is deposited <strong>in</strong> <strong>the</strong> bank.Fish market<strong>in</strong>g <strong>in</strong> <strong>the</strong> Kombuthurai village ofThoothukudi district was similar to <strong>the</strong> o<strong>the</strong>r land<strong>in</strong>gcentres of <strong>the</strong> region <strong>in</strong>itially. But, <strong>the</strong> demand forpremium varieties of fish like seer fish, barracudas,carangids, etc. landed <strong>in</strong> fresh condition and <strong>in</strong> goodquality by l<strong>in</strong>e fish<strong>in</strong>g at Kombuthurai attracted manywholesalers to purchase fish at a better price comparedto o<strong>the</strong>r land<strong>in</strong>g centres of <strong>the</strong> region, where fishes<strong>from</strong> gill nett<strong>in</strong>g and trawl<strong>in</strong>g are landed. The market<strong>in</strong>gmethod followed by <strong>the</strong> fishermen of Kombuthurai wasresort<strong>in</strong>g to daily auction, <strong>the</strong> major difference of which<strong>from</strong> <strong>the</strong> o<strong>the</strong>r land<strong>in</strong>g centres was that <strong>in</strong> Kombuthurai<strong>the</strong> fishes were segregated species-wise and auctionedon per-kg-basis and later sold on weight-basis. In <strong>the</strong>land<strong>in</strong>g centre, two types of <strong>in</strong>termediaries, namelyauctioneers and wholesalers were present. Theauctioneers had <strong>the</strong> responsibility of collect<strong>in</strong>g <strong>the</strong>money <strong>from</strong> <strong>the</strong> wholesalers and distributed it to <strong>the</strong>fishermen through fishermen associations. The auctioncharge was 10 per cent of <strong>the</strong> sales which was collected<strong>from</strong> <strong>the</strong> fishermen by <strong>the</strong> association. In Kombuthurai,<strong>the</strong>re were five fishermen associations as given <strong>in</strong> Table2 and each association had authorized one auctioneerto auction <strong>the</strong> fishes landed by its members. Eachauctioneer was paid Rs 5000 per month by <strong>the</strong>association.In <strong>the</strong> Kombuthurai village, <strong>the</strong>re were 12 regularwholesalers. The wholesalers <strong>from</strong> o<strong>the</strong>r places suchTable 2. Fishermen associations function<strong>in</strong>g <strong>in</strong>Kombuthurai, Tamil NaduName of <strong>the</strong> No. of years No. of Vallamfishermen <strong>in</strong> existence under controlassociationSt. Francis Xavier 25 58St. Mudiapper 20 28St. Rayapper 8 4St. Christuraja 7 25Tuticor<strong>in</strong> Multipurpose 7 25Social Service SocietyNote: Vallam is a traditional non-mechanized fish<strong>in</strong>g craftused along <strong>the</strong> sou<strong>the</strong>ast coast of Indiaas Thoothukudi, Kanyakumari, Manappad of TamilNadu and <strong>from</strong> major markets <strong>in</strong> Kerala purchase fishthrough auction ei<strong>the</strong>r directly or through <strong>the</strong>ir agents.The Kombuthurai fishermen associations fix <strong>the</strong> priceof product based on its size and species. The averageprice of different varieties of fishes marketed atKombuthurai and o<strong>the</strong>r land<strong>in</strong>g centres <strong>in</strong> Thoothukudidistrict is given <strong>in</strong> Table 3 for a comparison and to depict<strong>the</strong> price advantage <strong>the</strong> fishermen of <strong>the</strong> former getthan <strong>the</strong> latter on account of grad<strong>in</strong>g practices.A perusal of Table 3 clearly reveals that <strong>the</strong><strong>in</strong>novative market<strong>in</strong>g model followed by <strong>the</strong> fishermenof Kombuthurai fish<strong>in</strong>g village is a worthy model to befollowed <strong>in</strong> o<strong>the</strong>r mar<strong>in</strong>e fish land<strong>in</strong>g centres of <strong>the</strong>country. Segregat<strong>in</strong>g <strong>the</strong> fish catch species-wise andauction<strong>in</strong>g on weight basis through fishermenassociations, comb<strong>in</strong>ed with proper market <strong>in</strong>formationTable 3. A comparison of land<strong>in</strong>g price of different fishspecies <strong>in</strong> Kombuthurai and o<strong>the</strong>r land<strong>in</strong>g centres<strong>in</strong> Thoothukudi, Tamil NaduPrice (Rs/kg)Fish species Kombuthurai O<strong>the</strong>r land<strong>in</strong>gcentresSeer fish 235 150Cuttle fish 150 120Squid 150 100Katsuwonus sp 70 50Alectis sp 65 40Spyraena sp 65 40Carangids 60 40Lethr<strong>in</strong>us sp 55 30Tuna 50 30


Ganesh Kumar et al. : <strong>Lessons</strong> <strong>from</strong> <strong>Innovative</strong> <strong>Institutions</strong> <strong>in</strong> <strong>the</strong> Market<strong>in</strong>g of Fish <strong>in</strong> India 499would result <strong>in</strong> maximiz<strong>in</strong>g <strong>in</strong>come to <strong>the</strong> fishermenand m<strong>in</strong>imiz<strong>in</strong>g exploitation by <strong>the</strong> middlemen.(iii) Market<strong>in</strong>g by State-run FisheriesDevelopment CorporationsThe Tamil Nadu Fisheries DevelopmentCorporation Ltd. (TNFDC) has been <strong>in</strong>volved <strong>in</strong> freshfish market<strong>in</strong>g through its cha<strong>in</strong> of retail shops for manyyears. Start<strong>in</strong>g with two modern fish retail outlets, called‘Neidhal’ <strong>in</strong> Chennai city <strong>in</strong> 2008, it has 10 outlets across<strong>the</strong> state <strong>in</strong> 2010. These outlets were found equippedwith a display vesicular unit of deep freezer, fishclean<strong>in</strong>g and cutt<strong>in</strong>g space, electronic balance andstorage space, besides hygienic conditions. The fishprices were kept a little lower than those <strong>in</strong> <strong>the</strong>traditional fish retail markets. Freshwater fish likemurrels were sold <strong>in</strong> live condition. Fish dress<strong>in</strong>g wasdone <strong>in</strong> <strong>the</strong> presence of consumers to get <strong>the</strong>irconfidence. The consumer could select <strong>the</strong> fish as <strong>the</strong>sewere kept <strong>in</strong> a glass-top freezer. The objective ofstart<strong>in</strong>g <strong>the</strong> modern retail outlets through state<strong>in</strong>tervention was to source fish directly <strong>from</strong> fishermenand to sell to consumers at affordable rates underhygienic conditions. This has enabled <strong>the</strong> fishermen tomarket without <strong>the</strong> <strong>in</strong>tervention of middlemen and as aresult, <strong>the</strong>y get a better price for <strong>the</strong>ir catch. Acomparison across different market prices has beenfurnished <strong>in</strong> Table 4.(iv)Market<strong>in</strong>g by State-run Fisherman andFisherwomen CooperativesMatsyafed, <strong>the</strong> Kerala State CooperativeFederation for Fisheries Development Ltd., has takena major <strong>in</strong>itiative <strong>in</strong> organiz<strong>in</strong>g <strong>the</strong> primary auction at<strong>the</strong> land<strong>in</strong>g centre (beach) itself, as <strong>the</strong> majorexploitation of <strong>the</strong> fishermen occurs <strong>the</strong>re itself.Matsyafed undertakes <strong>the</strong> auction <strong>in</strong> <strong>the</strong> fish<strong>in</strong>g villagesand <strong>the</strong> cooperatives have become <strong>the</strong> major force <strong>in</strong>sett<strong>in</strong>g up <strong>the</strong> beach level auction. Over a period oftime, Matsyafed could make this as its major activity <strong>in</strong><strong>the</strong> coastal area and many fishermen societies haveachieved a high level of turnover <strong>in</strong> this process.Matsyafed has taken <strong>in</strong>itiatives to sell fish <strong>in</strong> <strong>the</strong>secondary market as well as through its own <strong>the</strong> retailsystem directly to <strong>the</strong> customers. A model retail outlethas been established at <strong>the</strong> premises of <strong>the</strong> MatsyafedNet Factory <strong>in</strong> Coch<strong>in</strong>. A new system of procurementand sales with staff participation has been designed toensure efficiency and effectiveness with a focus oncustomer’s satisfaction and a better environment forfish sales compared to <strong>the</strong> old and traditional system.Ano<strong>the</strong>r <strong>in</strong>novative outlet was started by Matsyafedas <strong>the</strong> ‘Fresh Fish Po<strong>in</strong>t’, <strong>in</strong> Coch<strong>in</strong> <strong>in</strong> 2006. At thisoutlet, procurement of fish was found aligned with <strong>the</strong>wholesale market and sell<strong>in</strong>g price was fixed accord<strong>in</strong>gto <strong>the</strong> market forces. The unit could make a sale ofTable 4. A comparison of fish market<strong>in</strong>g at ‘Neidhal’ and o<strong>the</strong>r modern retail outlets and traditional fish marketsParameters Neidhal Reliance Spencer Fish-o-Fish Traditional Traditional(TNFDC) (private (private (private outlet) wholesale retailoutlet) outlet) markets marketsVarieties marketed 8-12 50-150 10-15 10-15 25-40 4-5Price Close to Fixed by Fixed by Close to Based on 20-35%traditional <strong>the</strong> <strong>the</strong> company TNFDC variety plus ofwholesale company rates and arrival wholesalemarketmarketO<strong>the</strong>r services Clean<strong>in</strong>g Clean<strong>in</strong>g Clean<strong>in</strong>g Clean<strong>in</strong>g Nil Nil or on& cutt<strong>in</strong>g & cutt<strong>in</strong>g & cutt<strong>in</strong>g & cutt<strong>in</strong>g paymentOutlets 2 <strong>in</strong> 49 15 4 5 markets 150Chennai citylocalitiesOutlet tim<strong>in</strong>gs 9.00 am to 9.00 am to 9.00 am to 9.00 am to 4.00 am to 11.00 am to7.00 pm 9.00 pm 9.00 pm 9.00 pm 11.00 am 7.00 pmPark<strong>in</strong>g facility Yes Yes Yes Yes No NoAvailability of No Yes Yes Yes No Nosubstitute fish speciesHygiene status Good Good Good Fair Poor Very poor


500 Agricultural Economics Research Review Vol. 23 (Conference Number) 2010Table 5. Performance of ‘Fresh Fish Po<strong>in</strong>t’ — A modernretail outlet of Matsyafed (KSCFFD) <strong>in</strong> Coch<strong>in</strong>:2006-07ParticularsQuantity of fish purchasedQuantity of fish soldCost of fish purchasesTotal expensesTotal sale valueGross profitFixed expensesIncentivesNet profitAmount32.21 tonnes32.15 tonnesRs 30.57 lakhRs 32.01 lakhRs 40.92 lakhRs 8.91 lakhRs4.64 lakhRs 3.20 lakhRs 1.07 lakhabout Rs 41 lakh <strong>in</strong> <strong>the</strong> very first year with a grossprofit of about Rs 9 lakh and a net profit of more thanRs 1 lakh (Table 5). Based on its success, Matsyafedplans to scale up <strong>the</strong> model to a larger volume by add<strong>in</strong>gabout 500-1000 outlets <strong>in</strong> next 3 years. It also plans toenlarge <strong>the</strong> list of fish and fishery products for sale at‘Fresh Fish Po<strong>in</strong>t’.In Karnataka, <strong>the</strong>re are strong community-basedcooperatives for <strong>the</strong> market<strong>in</strong>g of fish harvested by<strong>the</strong> traditional fishers and gill net operators. Had<strong>in</strong>aaruPatna Meenugaarara Market VyavasthaapanaSamithi was found one such organization provid<strong>in</strong>gcredit and market<strong>in</strong>g services to small-scale fishermen.Ano<strong>the</strong>r community-based co-operative organizationwas <strong>the</strong> Mangalore 16 Patna Meenu MarataVyavastha Samithi. It was established <strong>in</strong> 1962 with<strong>the</strong> follow<strong>in</strong>g specific objectives: (i) to organize <strong>the</strong>market<strong>in</strong>g of fish; (ii) to offer credit facilities tofisherwomen for retail<strong>in</strong>g of fish and fishery products;(iii) to provide advance loans for purchas<strong>in</strong>g andprocess<strong>in</strong>g of fish and repairs and ma<strong>in</strong>tenance oftraditional fish<strong>in</strong>g crafts and gear, and (iv) to providewelfare services such as support for education andunforeseen cont<strong>in</strong>gencies to members and non-memberfamilies under distress. The membership profile andloans advanced to fishermen own<strong>in</strong>g different fish<strong>in</strong>ggears are given <strong>in</strong> Table 6.(v) Aquachoupal – An ICT-based Supply Cha<strong>in</strong>ModelThe e-Choupal is a web supported <strong>in</strong>itiative, offer<strong>in</strong>gfarmers <strong>in</strong>formation, customized knowledge productsand services to enhance farm productivity and farmgateprize realization on various crops, viz. soybean,coffee, wheat, rice, pulses and shrimp (Mahalakshmiet al., 2006). The Aquachoupal network, launched <strong>in</strong>2001 <strong>in</strong> <strong>the</strong> state of Andhra Pradesh, <strong>in</strong>cludes 55 kiosksreach<strong>in</strong>g 10,000 shrimp farmers <strong>in</strong> over 300 villages.The Aquachoupal <strong>in</strong>formation centers are equipped witha computer connected to <strong>the</strong> Internet and are located<strong>in</strong> <strong>the</strong> rural villages (Figure 1). Aquachoupals serveboth as a social ga<strong>the</strong>r<strong>in</strong>g place for exchange of<strong>in</strong>formation and an e-commerce hub.The supply cha<strong>in</strong> for <strong>the</strong> Aquachoupal market<strong>in</strong>gsystem is depicted <strong>in</strong> Figure 2. The clos<strong>in</strong>g price ofprevious day’s market<strong>in</strong>g is used to determ<strong>in</strong>e <strong>the</strong>benchmark price at <strong>the</strong> Aquachoupal for a given day.To <strong>in</strong>itiate a sale, <strong>the</strong> Sanchalak or Prath<strong>in</strong>ithi of ITC<strong>in</strong>spects <strong>the</strong> produce and based on his assessment ofquality, gives a conditional quote to <strong>the</strong> farmer. Thebenchmark price represents <strong>the</strong> upper limit on <strong>the</strong> pricea Prath<strong>in</strong>ithi can quote. If <strong>the</strong> farmer chooses to sellhis crop to ITC, <strong>the</strong> Prath<strong>in</strong>ithi gives him a noteconta<strong>in</strong><strong>in</strong>g details about his name, village, quality of <strong>the</strong>produce, approximate quantity and conditional price.The farmer takes <strong>the</strong> note along with his crop to <strong>the</strong>nearest ITC procurement hub (process<strong>in</strong>g centre).Table 6. Membership profile and loan advanced by Mangalore 16 Patna Meenu Marata Vyavastha Samithi <strong>in</strong> 2007-08Type of gear Loan advanced No. of Loan recoveryper unit gear members (% of sale proceeds(Rs) of daily fish catch )Gill nets 30,000 - 40,000 40 10Traditional fishermen (Pattebale, Kanthale) 25,000 - 30,000 50 10Small mechanized boats 20,000 8 5FisherwomenSellers of high-value fishes 25,000 - 40,000 15 10Sellers of small fishes 5,000-10,000 20 10


Ganesh Kumar et al. : <strong>Lessons</strong> <strong>from</strong> <strong>Innovative</strong> <strong>Institutions</strong> <strong>in</strong> <strong>the</strong> Market<strong>in</strong>g of Fish <strong>in</strong> India 501Figure 1. The Aquachopal model <strong>in</strong> Andhra PradeshFigure 2. Supply cha<strong>in</strong> <strong>in</strong> Aquachoupals <strong>in</strong> Andhra PradeshAt <strong>the</strong> ITC procurement hub, produce is tested forquality and weighed. The farmer <strong>the</strong>n gets <strong>the</strong> payment<strong>in</strong> full; he is also reimbursed for transport<strong>in</strong>g his crop to<strong>the</strong> procurement hub. Every stage of <strong>the</strong> process isaccompanied by appropriate documentation. Thefarmer is provided a copy of lab report, agreed rates,and receipts for his records.The farmers sell <strong>the</strong>ir produce through Aquachoupalby us<strong>in</strong>g <strong>the</strong>ir services. The usage pattern and servicesgenerally provided at all <strong>the</strong> centers <strong>in</strong>clude <strong>in</strong>formationon government schemes / procedures, wea<strong>the</strong>r forecast,market prices, general FAQs (Frequently AskedQuestions), transactional services like communicationthrough e-mail and chat, buy<strong>in</strong>g / sell<strong>in</strong>g goods, etc.(Table 7).The study on utilization of services provided byAquachoupals revealed that 36 per cent of <strong>the</strong>respondents rarely made use of <strong>the</strong> wea<strong>the</strong>r reportfacility (Figure 3), but <strong>the</strong> pric<strong>in</strong>g facility was used bymost respondents (64%) frequently. They also felt that<strong>the</strong> Aquachoupal provides access to prices on a dailybasis. Therefore, farmers are able to take <strong>the</strong> criticaldecisions on when and where to sell <strong>the</strong>ir crop. Abouthalf of <strong>the</strong> respondents (51%) made use of <strong>the</strong>customized quality solution facility frequently. Thefarmers showed keen <strong>in</strong>terest to know <strong>the</strong> ways toprevent <strong>in</strong>festation of diseases, <strong>the</strong>ir detection andeffective disease management. They also op<strong>in</strong>ed that<strong>the</strong>y could improve crop quality and yield ow<strong>in</strong>g tocustomized quality solution given by <strong>the</strong> Aquachoupals.More than 15 per cent of <strong>the</strong> farmers made use of <strong>the</strong>best practices and FAQ facilities.


502 Agricultural Economics Research Review Vol. 23 (Conference Number) 2010Table 7. Services provided by Aquachoupals <strong>in</strong> Andhra PradeshServicesWea<strong>the</strong>rMarket priceCustomized quality solutionBest practicesFAQsCommunicationO<strong>the</strong>rsMean<strong>in</strong>gsLocalized wea<strong>the</strong>r <strong>in</strong>formation at <strong>the</strong> district level.Local and <strong>in</strong>ternational company’s rates. ITC’s next day rates are published every even<strong>in</strong>g.The prices are displayed prom<strong>in</strong>ently on <strong>the</strong> top of <strong>the</strong> web page on a scroll<strong>in</strong>g sticker.After <strong>the</strong> sale of a crop is completed, ITC performs laboratory test<strong>in</strong>g of <strong>the</strong> samplecollected. Based on <strong>the</strong>se results, farmers are given customized feedback on how <strong>the</strong>y canimprove crop quality and yield.Scientific practices organized by crop type are available on <strong>the</strong> web site.This feature enables two-way communication. Additional questions are answered throughFAQs and access to experts who respond to e-mails <strong>from</strong> <strong>the</strong> village.Prath<strong>in</strong>ithi uses <strong>the</strong> Internet to chat extensively among <strong>the</strong>mselves about <strong>the</strong> status ofoperations and aquaculture <strong>in</strong> <strong>the</strong>ir villages.In addition to aquaculture-related <strong>in</strong>formation, farmers get <strong>in</strong>formation on governmentschemes / procedures, educational <strong>in</strong>formation. They are also benefited through <strong>in</strong>formationabout health-oriented programmes such as eye camp, blood test<strong>in</strong>g, and blood donation,etc.Figure 3. Usage pattern of Aquachoupal services <strong>in</strong> Andhra PradeshThe lessons <strong>from</strong> various <strong>in</strong>novations <strong>in</strong> <strong>the</strong>market<strong>in</strong>g <strong>in</strong>stitutions deal<strong>in</strong>g with fish and fisheryproducts at selected locations of <strong>the</strong> country have beensummarized <strong>in</strong> Table 8. It depicts <strong>the</strong> factors forsuccess, constra<strong>in</strong>ts to up-scal<strong>in</strong>g and suggestions toovercome <strong>the</strong>m under different <strong>in</strong>novative <strong>in</strong>stitutions<strong>in</strong> fish market<strong>in</strong>g.ConclusionsStagnat<strong>in</strong>g mar<strong>in</strong>e fisheries productivity, ris<strong>in</strong>g costof fish<strong>in</strong>g operations and <strong>in</strong>puts, decl<strong>in</strong><strong>in</strong>g fishermen<strong>in</strong>come and high price-volatility of fish and fisheryproducts are mak<strong>in</strong>g this enterprise unremunerative andrisky, lead<strong>in</strong>g to distress and unrest among <strong>the</strong>


Ganesh Kumar et al. : <strong>Lessons</strong> <strong>from</strong> <strong>Innovative</strong> <strong>Institutions</strong> <strong>in</strong> <strong>the</strong> Market<strong>in</strong>g of Fish <strong>in</strong> India 503Table 8. Success and constra<strong>in</strong>ts faced by <strong>the</strong> market<strong>in</strong>g <strong>in</strong>stitutions<strong>Innovative</strong> market<strong>in</strong>g Factors for success Constra<strong>in</strong>ts Suggestions<strong>in</strong>stitutionsSelf-help groups Effective leadership; Competition <strong>from</strong> market; Regulation by(SHGs) Collective barga<strong>in</strong><strong>in</strong>g; Lack of transport facilities; authorities;W<strong>in</strong>-w<strong>in</strong> situation; Insufficient <strong>in</strong>sulated ice box; Provision of subsidy;Enthusiasm and discipl<strong>in</strong>e; Lack of <strong>the</strong>ir modern fish Provision of soft loanSelf-confidence due to retail<strong>in</strong>g stall;empowerment;Less <strong>in</strong>come dur<strong>in</strong>gInformed decision-mak<strong>in</strong>g;Better communication.lean season;Loan at very high <strong>in</strong>terestrates <strong>from</strong> private moneylenders.Producer associations Inclusive membership; Lack of knowledge about Advertisement;Tangible deliverables; product differentiation Brand promotionSocial cohesiveness;Conviction of <strong>the</strong> farmers.Fishermen and Work<strong>in</strong>g <strong>in</strong> closeness Inability to handle more Active <strong>in</strong>volvementfisherwomen with fishermen; species; of state federationcooperativies Trust and confidentiality; Inability to market <strong>the</strong> with national apexHygienic shop; whole day; federation,Transparency <strong>in</strong> weighment Slow expansion of FISHCOPFED;us<strong>in</strong>g electronic balance; cooperative societies Increas<strong>in</strong>g <strong>the</strong> numberLower prices than <strong>in</strong>of species <strong>in</strong> saleconventional fish markets;counter;Dress<strong>in</strong>g by tra<strong>in</strong>edExtend<strong>in</strong>g <strong>the</strong> sales forpersonnels;whole dayAvailability of fish filletsand steaks <strong>in</strong> <strong>the</strong> outlet.Private <strong>in</strong>stitutions Price <strong>in</strong>formation on Ignorance of <strong>the</strong> Awareness creation;daily basis; farmers; On-pond test<strong>in</strong>gSell<strong>in</strong>g decision by Lack of awareness; facilitiesfarmers <strong>the</strong>mselves;Lack of <strong>in</strong>teractionLesser transport cost; with <strong>the</strong> <strong>in</strong>stitution;Improvement <strong>in</strong> fishLimited number ofproductivity;process<strong>in</strong>g plants andAccessibility of <strong>in</strong>puts soil and water test<strong>in</strong>gat less cost than <strong>in</strong>facilities.local market.fishermen communities. At <strong>the</strong> same time, <strong>the</strong> sectoris <strong>in</strong> <strong>the</strong> process of transformation <strong>from</strong> a subsistencesystem to a commercial and export-oriented one,throw<strong>in</strong>g open many opportunities for all <strong>the</strong>stakeholders <strong>in</strong> this sector. In this process, <strong>the</strong>re areapprehensions that <strong>the</strong>se poor fisher folks would bemarg<strong>in</strong>alized and a bulk of benefits would be siphonedby <strong>the</strong> middlemen or <strong>the</strong> agri-bus<strong>in</strong>ess houses. Thisstudy has documented <strong>the</strong> success stories and <strong>the</strong>lessons to be drawn for up-scal<strong>in</strong>g <strong>the</strong>m <strong>in</strong> a similarsocio-politco-economic scenario <strong>in</strong> <strong>the</strong> country. Thepolicy implications have been drawn <strong>from</strong> differenttypes of <strong>in</strong>novative <strong>in</strong>stitutions, which stress on <strong>the</strong>collective action of public and private sectors,cooperatives, producer associations, etc. The study hasmentioned about <strong>the</strong> primary activities of those<strong>in</strong>stitutions <strong>in</strong> efficient fish market<strong>in</strong>g such as <strong>in</strong>boundlogistics, operations, outbound logistics, market<strong>in</strong>g and


504 Agricultural Economics Research Review Vol. 23 (Conference Number) 2010sales promotion and support activities such as<strong>in</strong>frastructural facilities, technological backstopp<strong>in</strong>g,price <strong>in</strong>formation and procurement. Through <strong>the</strong>seadvantages, <strong>the</strong> fishermen could achieve economiesof scale, technological <strong>in</strong>novations, capacitydevelopment, l<strong>in</strong>kage across activities, degree ofvertical <strong>in</strong>tegration, tim<strong>in</strong>g of market entry, productdifferentiation, market access, credit access, etc. Thestudy has suggested replication of such successful<strong>in</strong>novative <strong>in</strong>stitutions <strong>in</strong> market<strong>in</strong>g <strong>the</strong> fish and fisheryproducts through appropriate policies and programmes.Awareness should be generated among <strong>the</strong> fishermencommunity about <strong>the</strong> need, importance and advantagesof such collective action through <strong>in</strong>stitutions like SHGs,producer / fishermen associations, cooperatives, etc.so that <strong>the</strong> exploitation of middlemen <strong>in</strong> <strong>the</strong> productionto-consumptioncha<strong>in</strong> <strong>in</strong> this fledg<strong>in</strong>g sector could bem<strong>in</strong>imized. Entry of private agencies <strong>in</strong> this regardshould also be promoted with appropriate regulatorymechanism so as to prevent possible exploitation offishermen community.ReferencesAcharya, S.S. (1997) Agricultural market<strong>in</strong>g <strong>in</strong> India: Policyframework, emerg<strong>in</strong>g issues and needed <strong>in</strong>itiatives. TheBihar Journal of Agricultural Market<strong>in</strong>g, 5 (3): 253-269.Ali, E.A., Gaya, H.I.M. and Jampada, T.N. (2008) Economicanalysis of fresh fish market<strong>in</strong>g <strong>in</strong> maiduguri gamborumarket and kachallari alau dam land<strong>in</strong>g site ofNor<strong>the</strong>astern Nigeria. Jouranl of Agriculture and SocialScience, 4: 23-26.Ayyappan, S. and Krishnan, M. (2004) Fisheries sector <strong>in</strong>India: Dimensions of development. Indian Journal ofAgricultural Economics, 59 (3): 392-412.Chahal, S.S., S<strong>in</strong>gh, S. and Sandhu, J.S. (2004) Price spreadsand market<strong>in</strong>g efficiency of <strong>in</strong>land fish <strong>in</strong> Punjab: Atemporal analysis. Indian Journal of AgriculturalEconomics, 59 (3): 498.Gupta, V.K. (1984) Mar<strong>in</strong>e Fish Market<strong>in</strong>g <strong>in</strong> India (VolumeI – Summary and Conclusions). IIM Ahmedabad &Concept Publish<strong>in</strong>g Company, New Delhi.Katiha, P.K. and Barik, N.K. (2004) Governance, <strong>in</strong>stitutionsand policies for fisheries of floodpla<strong>in</strong> wetlands. IndianJournal of Agricultural Economics, 59 (3): 490.Kumar, K.G. (2010) Women Fish Vendors <strong>in</strong> India: AnInformation Booklet. International Collective <strong>in</strong> Supportof Fishworkers (ICSF), Chennai.Mahalakshmi, P., Vimala, D.D. and Krishnan, M. (2006). Webkiosks <strong>in</strong> aquaculture: A study of aquachoupal model <strong>in</strong>Prakasam district of Andhra Pradesh. Proceed<strong>in</strong>gs of<strong>the</strong> National Sem<strong>in</strong>ar on Extension Strategies forFoster<strong>in</strong>g Knowledge-centric Agricultural Growth,Puducherry, 2-3 December, 2006.Punhani, R. (2001) Agricultural market<strong>in</strong>g with specialreference to horticulture produce. The Bihar Journal ofAgricultural Market<strong>in</strong>g, 9 (1): 1-6.Srivastava, U.K. and Kant, Uma (1985) Inland Fish Market<strong>in</strong>g<strong>in</strong> India (Volume I – Overview: Summary andConclusions), IIM Ahmedabad & Concept Publish<strong>in</strong>gCompany, New Delhi.

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