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Marketing of Areca

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ARECA NUT MARKETING

MEANING

Areca marketing is the systematic performance of areca business activities related to processing, assembling, grading, storing, packing, value adding, standardizing, branding, transporting, financing, selling and distributing in order to reach the areca produce from the point of producing farmers to the point of ultimate consumers. In the process of areca marketing production being the starting point of marketing it provides proper base, shape and color to the marketing arrangement. Therefore, based on the nature of concentration and pattern of consumption of areca produce existing market structure can be divided into three parts.

1.PRIMARY MARKET : It is an arrangement for marketing of areca nut where areca flows from the producer to the traders in primary market through the active participation  of intermediaries.

2.SECONDARY MARKET : Secondary market is an arrangement of wholesale market where areca produce is processed and handled in large quantities to reach the terminal point.

3.TERMINAL MARKET : Terminal market of areca is the final point of market where areca  is distributed to the final consumers through the well established retail network. While initiating the process of directing the flow of areca produce from the centre of production to consumption, farmers, traders cum farmers, crop contractors, petty traders, village merchants, commission agents, processors, collectors, co-operative societies, retailers, wholesale traders, commission agents,  brokers, transporters, Agricultural Produce Market Committees, weigh men and porters will participate and constitute the whole network of areca marketing system. Finally the major success of areca marketing system is depending upon the rate of production and active participation from the marketers. 'Efficient disposal of areca produce is the subject matter of areca marketing'. Aspects of production and processing will contribute towards the problems and prospects of areca marketing.

 

MARKETING STRUCTURE AND PROFILE

The marketing functionaries involved in the process comprise traders, CAS exporters, village traders, petty traders and crop contractors. All these intermediaries operate further from the co-operatove societies located at the Taluk head quarters. Final traders in turn buy it from the open market provided by these societies and other CAs. Before selling to final traders in the secondary market commercial grading is undertaken. Red variety areca nut of Malnadu region established demand in market of Karnataka, Bombay, Nagpur and Lucknow. Emerging developments of VAPs of areca and development of gutkha industries have opened the flood gates of new avenues of revenues to farmers. They preferred the red variety, specially for gutkha production. The white variety “Chali” has good demand in Bombay and Gujarat market too. The factory variety has good demand in local market as well as in Bombay market. However, producers are least bothered in commercial grading as they do not have much knowledge of secondary marketing. Even most of the farmers do not know where areca nut is sold, what is done after they sell, where and how it is used. Producers sell their produce in the primary market having done traditional grading mainly “Rashi”, "Bette", “Api/Chikani” and “ Kempgotu” in red variety, “Chali”, “Bilegotu”, "chalikempu", "Vodaku", "Koka”, "Factry”, “Niradike” or "Gotadike” in white variety.

SCENARIO OF ARECA MARKETING

Areca nut is a commercial crop the production of which is concentrated in a few states while consumption is spread all over the country. The produces bulked in the producing centers are distributed to consumption centers. In India, areca nut is marketed as unhusked whole fruit, dehusked and dried nut, boiled dried whole kernel or boiled splits and in the form of VAPs. About 20 percent of total areca production in the country is consumed as ripe fruit and the rest in the form of whole nut and processed forms. Marketing of semi-ripe, fully-ripe or fermented areca has gained considerable value in Assam, Kerala and West Bengal. In Kerala, nearly 25 percent of the produce is marketed after harvest either in semi-ripen or fully ripen form.

In Karnataka the commission agents conduct auction and equip selling. The buyers on receipt dispatch this produce to different terminal centers for consumption. Karnataka, Kerala, Tamil nadu and Goa have established regulated markets for areca nut. In Karnataka there are 23 regulated markets are established areca nut growing regions. In Kerala, there are 4 regulated markets. In Tamilnadu and Goa the role of regulated market is found less. In Karnataka, Kerala and Tamilnadu more than 30 percent of the marketable surplus is dealt by co-operative societies. There are more than 16 major co-operative marketing societies handling areca nut in Karnataka. The Daxshina Kannada society is the oldest at Mangalore (set up in 1919, S.K.A.C.M.S Mangalore) followed by the  Totgars' co-operative sale society Ltd Sirsi (TSS in 1923) and Malenadu Areca marketing co-operative society at Shimoga ( MAMCOS  in 1939), TAPCMS Siddapur in 1947, TAPCMS Yellappur in 1966, APSCOS Sagar in 1973, TUMCOS Chennagiri in 1984, TAPCMS Sirsi in 1985 and marketing societies at Arakalgud, Tumkur and Kumta. All these societies are functioning as commission agents. Central Areca nut and Cocoa Marketing and Processing Co-operative Limited, (CAMPCO in 1973) Mangalore had took the risk of marketing of all category of areca in Karnataka, Kerala, Tamilnadu and other states. The price of areca nut varies from market to market on account of differences in variety, grade, size, color, maturity, moisture, usage, content and harvesting season etc.


The price fluctuation is not only due to variation in supply conditions of the commodity but also due to availability. Lack of quick transport  facilities from one region to other, efficiency of the market services, availability of credit and storage facilities and above all the system of marketing. As regards the harvesting period, in Kerala, Maharashtra and Tamilnadu the season is from October to January, depending upon (First, second and third) crop cutting practices. So far as grading of areca is concerned, there are two types of grading in areca nut: traditional and commercial. Basically, the producer does traditional grading by making four to five varieties. Commercial grading is done by the traders based on size of areca nut. The agmark grade specifications for old dried areca nut have already been set up under the agricultural Produce Act, 1937. Agmark grade is based on size and quality of nuts. There are 12 grades depending upon the percentage of size, copra white, yellowish brown and damaged nuts.

Every year we can notice about 9 to 12% of the total crop as damaged nuts before harvesting. Every year about 9 to 12 percent of harvested ripe areca nut is stored in pits or poured in water for consumption during off season in Assam, Karnataka, Tamilnadu and West Bengal. About 10 percent dried areca nuts, 3 percent boiled and dried area nuts are stored in the production centers with an expectation of getting higher rate during off season i.e. July to October. In 1960’s India was importing areca nut for domestic consumption. Now, situation had reversed, export began after 1980s when “Panmasala” containing scented Supari was introduced. Export of VAPs has been slowly increasing. Apart from this, product like gutkha has increased the consumption quantum and habit of areca nut. There are no exclusive markets for the sale of areca nut in the country. Unlike other agricultural crops, areca nut also forms one of the commodities handled in a particular market. The important assembling markets in Karnataka are Mangalore, Shimoga, Sirsi, Sagar, Kumta, channagiri and Bhimasamudra. Palai, Ponkunnam, Alleppey, Cochin, Trichur and Kasargod are important assembling and distribution centers in Kerala. In Assam, Guwahati and Dhubri and Shillong are the main centers. Chennai and Mettupalyam are major  marketing centers in Tamilnadu. Ponda and Bicholim are said to be small marketing centers of Goa.

 MARKETING SCENARIO OF ARECANUT IN UTTAR KANNADA DISTRICT 

Although production is wide spread throughout the District, marketing is mainly concentrated in Sirsi, Yellapur, Kumta and Honnavar. Agricultural Produce Market Committee (APMC) branches are functioning here in the best intension of providing protection to the farmers from exploitation of private traders. There are no established marketing facilities and centers in Ankola, Bhatkal, Joida and Mundgod. Hence, these farmers depend on nearby market centers of the District and neighboring District. Majority of  farmers of Ankola, Mundgod and Joida prefer to sell produce at Yellapur market. The factor of proximity has made them to follow this measure. Few farmers of Mundgod Taluk prefer to sell in Sirsi market which is closer to them. Whereas farmers from Bhatkal take chance to sell areca in market centers of Kumta and Honnavar and Kundapur in Udupi District and Sagar in Shimoga District. Sirsi market is one of the famous areca markets in the state and U.K. District. Here all types of areca produced in the District are sold except the “Factry” variety. It attracts areca nut from the areas of Sirsi, Yellapur, Kumta, Mundgod and Soraba Taluka of Shimoga Distrct. It represents a leading areca market from the Malanadu region and District. as well. It has outstripped all other markets of the District. The farmers residing in these regions have belief over the principles of co-operation. Hence, they sell produces through primary or marketing co-operatives functioning in a transparent and systematic style.

Siddapur is not lagging behind. It attracts areca from Siddapur area and parts of Sagar and Sorab Taluk of the neighboring District. All verities of areca produced in the Malnadu region are dealt in this market. Yellapur is another emerging market center of the District. It was famously known as a market for ‘Red supari’ or ‘Aapi’ variety. It attracts areca nut from the surrounding area of Yellapur, Sirsi, Mundgod, Joida, Dandeli and Ankola. All types of areca nuts of this area are transacted here.

Marketing center in the costal belt are famous for dried variety of areca nut. (i.e., ‘Chali’) Marketing of ‘factry’ (Fermented areca fruit”) is seen here. In this region Kumta and Honnavar are emerged as major marketing center for areca nut. Kumta market leads in terms of arrivals and sales of areca nuts compared to Honnavar market. It attracts areca from the areas of Kumta, Honnavar, Anokola and Bhatkal. It is identified as leading market of coastal belt. Honnavar is another major marketing center in the below ghat section. It is also famous for dried varieties and factry type. It is also famous center for dealing areca fruits. For the farmers of Bhatkal, it is convenient market to sell dried varieties. However, in terms of business volume, it is small center of the District.

 
ARECA MARKETING IN UTTAR KANN ADA

Following are the salient features about areca produce to be understood while planning and deploying marketing strategies.

  1. Production is concentrated throughout the District and market is concentrated at Taluka head quarters.
  2. Around 5 percent of production is consumed in the District and remaining 95 percent is available for marketing.
  3. Consumption of areca nut is wide spread.  
  4. Marketing problems are associated in the areas of production and processing in relation with traders and consumers.
  5. Production is seasonal and crops are harvested once in a year. Areca is semi-perishable in nature and can be stored up to 2- 2.5 years.
  6. Demand prevails for areca throughout the year.
  7. Areca producers and traders experience bitter and better feeling with price behavior.
  8. Sales tax imposed on areca nut is high. Further it is levied on various points, so that consumer has to spend more.
  9. Tax evasion has become order of the areca marketing. Therefore, the attitude of farmers and traders contributed the emerging trend of second sale.
  10. Market structure comprises of primary, secondary and terminal markets.

 

Areca nut is breathing air of people of Uttara Kannada District. Lakhs of families are depending on areca garden land as a matter of subsistence. Marketing of areca nut speaks about economics, agriculture, commerce, standard of living of people residing here. No doubt, effective and efficient marketing of areca nut can change the pace of the District. Economy and efficiency should be the base for an effective thinking and implementation of long run policy to see the overall development. Always agricultural produce marketing calls for more intelligent and dynamic strategy than the industrial products because of its peculiar nature, cultivation and production processes. Marketing of areca nut has posed innumerable problems to people and organizations involved in it. The efforts of TSS and like co-operatives in establishing markets to cater to the needs of areca growers is really fabulous and commemorating every day.

In Uttara Kannada district TSS undertaking the big risk of areca nut marketing. We know marketing is not an easy job. In the best interest of its members it has invested crores of rupees and had created employment to thousands of families. It has undertook purchase, grading, storing, branding, value addition activities to increase demand for areca nut. It regularly spending crores of rupees for market awareness and to educate people about benefits of chewing areca. TSS fumigates and stores areca in cold storage to safeguard quality and sells areca to many states of the country in different brands and demanded weights. The scented sweet supari marketed by TSS is widely accepted in Indian market and succeeded in establishing planned brand image. The purchase and sale of areca nut by TSS and manufacture of sweet supari resulted to a large extent in stabilizing areca prices. Further, the efforts are still in progress to increase the market share for all range of products. TSS brand areca varities can be viewed in another option.


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