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Agricultural Supply Chains

Dr Satish Ch. Pant


Content
 Introduction
 Supply chain vs Value chain
 Supply Chain Network
 Integration of Supply Chain
 Supply Chain Decisions
 Constraints
 Supply Chain Ecosystem
1. INTRODUCTION
 Agriculture: Largest employment provider
 Plough to Plate (Production to Consumption)
 1% growth in Agriculture- 2-3 Times increase in overall
Growth (world bank report 2008)

 Advantage India
 Farm activities and Non Farm activities
 Changing consumerism
high value commodities

Processed food
Supply Chain?????

•Where are material sourced? Where are they build?

•What channel of distributions are used?

•How are strong relationship built with suppliers and


customers?

•How is customer information gathered and accessed?

•How are logistic Structures?

•How is information coordinated globally?

•How might incentives optimize the chains overall performance?


2. Supply Chain Vs Value Chain
3. Supply Chain Networks
A typical supply chain may involve a variety of stages. These supply
chain stages include:
Suppliers
Producers
Various Intermediaries (Wholesaler/distributor, retailer etc.)
Consumers
Agricultural Supply Chain
4. Integration of Supply Chain
The Dynamics of the Supply Chain
Order Size

Customer
Demand

Production Plan

Time
Source: Tom Mc Guffry, Electronic Commerce and Value Chain Management, 1998
Philosophy of SCM
 The entire supply chain is a single, integrated
entity.

 The cost, quality and delivery requirements of


the customer are objectives shared by every
company in the chain.

 Inventory is the last resort for resolving supply


and demand imbalances.
5. Supply Chain Decisions
 Strategic
 Planning
 Operational
Key Observations ?
 It involves trade-offs
* Across metrics: Cost, Service, Time, Risk, etc.

 Each interface in the supply chain represents


* Movement of goods

* Information flows

* Transfer of title

* Purchase and sale


Adani Agrifresh’s Operations in Himachal
6. Supply Chain Constraints
Broken Supply Chain
Supply Chain Inefficiencies
106 M small farmers
400 M agri workers
12 M Kirana shops
1.5 Million Hawkers
Too many intermediaries
Manual handling
Improper packaging
Standards for Hygiene
Not demand driven
Limited contract farming
Subsidized pricing
Public distribution inefficient
Reach to customers is difficult
Supply Chain Ecosystem
Case of SORGHUM/MILLETS
 Sorghum is an important stable food crop grown in semi-arid
regions of India and across the world especially in Asia and Africa.
It has been the main source of staple diet and animal feed for
centuries in the semi-arid regions of India, grown in both rainy
(June-October) and post-rainy (November-February) seasons. In
spite of its multiple uses as food, feed, fodder and bio-fuel, the
area under sorghum in India has declined from 18.61 million ha in
1969-70 to 6.25 million ha in 2011-12 primarily due to
disincentives resulting from PDS for fine cereals at cheaper cost,
and change in food habits/ tastes, rapid urbanization and
inconveniences attached with preparation for direct consumption
and unexplored potential for processed foods as in rice, wheat and
maize resulted in shift of sorghum area to cotton, maize, soybean,
sugarcane, sunflower, etc.
 The declining trends in sorghum production and consumption has been
perceived as critical to the economy of dry-land farmers where sorghum
cropping is more suitable than any other cereal crops. Some of the crucial
obstacles for creating demand of sorghum are, low marketed surpluses,
inconveniences for preparation, low shelf life, lack of technology, lack of
participation in processing and inadequate market. Besides poor government
intervention for improving production of millets, these crops are still lacking
behind in food market due to lack of processing intervention. In this context,
the processing and value-addition is crucial. Besides developing and
commercializing sorghum food products in the market, processing intervention
at farm level would generates more awareness for the commercialization of
sorghum to the farmers, which has high potential of generating more
employment in rural area. In fact, the farmers are also expected to increase the
market surplus of their grain which is crucial factor for supply chain
management intending for commercialization. Disseminating the production
technologies to the farmers that are developed in the Directorate of sorghum
Research (DSR) can create a great momentum towards processing intervention
at farm level by the farmers in the near future. The market studies conducted by
the ITC (ABD) Ltd shows that the lessening of sorghum consumption vis-à -vis
demand in the urban market is due to the unavailability- quantity as well lack of
availability in the kind of ready-to-eat or ready-to cook foods
Development of Supply Chain
Management in Sorghum/Millets
• To enable marked-driven millets production for specific end
uses, procurement and primary processing for continuous
supply chain management.
• Fine tuning of the technologies for development of millet
food products and up-scaling.
• To test for nutritional evaluation and safety of selected
millet foods.
• To assess consumer acceptability, price and market
strategies, and social and policy imperatives.
• Developing entrepreneurship and appropriate strategies to
promote and popularize millets for commercialization.
Technological innovations:
a. Identification of product specific varieties in millets
b. Nutritional evaluation of millet foods and using data for labelling
highlighting nutritional features
c. Shelf –life enhancement through improved packaging to meet modern
food habits by providing balanced nutrition
d. Standardization of multi-grain flour and food products
e. Fine-tuning of technologies in millet foods
Public-private participative (PPP) model of holistic farm-extension
services on seed supply, fertilizers, plant protection chemicals,
crop management and training.

Ready-to-eat and convenient foods to overcome cumbersome and


time-consuming food preparation of millets.

Branding millets as health foods through value-addition through


nutritional evaluation and certification
Innovative approaches for popularization such as road shows, wet
sampling, and millet tableaux for Republic day or Independence Day
parade, and at important public places and functions.

Coalition building with other research and private groups working


on millets elsewhere in the world through exchange visits and
conducting national seminar and workshops on millets and further
global meet on millets.

Recognition and value-addition to land races nursed by farmers for


long; possibly also securing IPR for local innovations.

“Model of support” to dry land farmers by linking with government


schemes such as mid-day meal scheme in pilot scale in one district
each of Andhra Pradesh, Maharashtra and Karnataka, so as to extract
value, and make public welfare system more efficient and locally
relevant educating on nutritious use of millets formulations.
Thank you