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Just like any other entrepreneur, all a farmer needs is an assured market and a better deal.
Akash Badave realised this as soon as he started working with tribal communities of Chhattisgarh’s Dantewada district a decade ago.
As a Prime Minister’s Rural Development Fellow, he was assigned to help the district administration improve the livelihoods of marginal communities.
Dantewada is in the spotlight for high level of malnutrition; for instance, as per the fifth round of the National Family Health Survey (2019-21), some 76 per cent of women aged 15-49 years in the district are anaemic.
The national average for the same group is 57 per cent. Previous attempts to improve nutritional status of people in the district, by enhancing agricultural production through chemical fertilisers and pesticides, had few takers.
“The chemicals killed all our earthworms and made our soil lifeless,” says Rameshwar Yadav, a farmer in the district’s Balud village.
In 2012, the district administration decided to motivate farmers to turn to organic farming and to grow crops other than traditional paddy and millet varieties.
But the exercise, says Badave, in-charge of the sensitisation programme, highlighted farmers’ reluctance to grow more or new crops.
Even if individual farmers grew surplus, there was a lack of market linkages for their harvest. The district, covered with dense forests and mineral-rich hills, has limited connectivity.
Though the government procures certain crops at minimum support price (MSP), it benefits few.
There is only one mandi for procurement of produce, which is out of reach for many. There is no system to procure organic produce.
However, following the repeated sensitisation programmes, the communities at one Krishi Mela proposed to set up a farmer-producer organisation (FPO).
Registered under the Companies Act, 2013, an FPO enables collectivisation of produce to help farmers reap benefits of the economies of scale.
Thus in 2016, the Bhoomgaadi Organic Farmer’s Producer Company Limited was set up in Dantewada, with Badave as chief executive.
The FPO follows a decentralised process. At the village level, farmers are arranged into groups, including women’s self-help groups. Some 10-12 villages form a cluster that elects a director to the FPO’s board.
Bhoomgaadi received funding from the district administration as a one-time loan of Rs 50 lakh under the district mineral fund, set up for welfare of mining-affected areas.
The FPO also gets additional funds of Rs 1 crore annually from the fund through Nirmaan, a Hyderabad-based civil society organisation.
Marketing is all about strategies. So to begin with, Bhoomgadi introduced a brand name — ‘Aadim’, which means ‘indigenous and original’ — under which it procures and sells produce of three categories — paddy, millets and pulses; native varieties of spices (coriander, turmeric, dry mango powder, red chillies); and minor forest products (tamarind, East Indian arrow root, almondette, mahua, sickle senna).
It has 50 raw, semi-processed and processed products in its catalogue.
To market the products, Bhoomgaadi employs a dual approach — it pitches unique native varieties like the aromatic Javaphul, Lokati Machi and medicinal Sathka rice to create new demand, while popular varieties like bold rice cater to existing demand.
The FPO first began selling the products through the Centre’s Tribal Co-operative Marketing Federation of India (TRIFED). Next, for processed products, it introduced two channels — loose sales of products in bulk, and white-packet sales, wherein the FPO packs items for sale by select companies.
Further, Bhoomgaadi has opened an outlet called “Jaiwik Bazar” in the district headquarters to sell the products, as well as an “Aadim Café” that serves food prepared with organic produce.
In terms of procurement, the FPO currently buys from 570 farmer groups, including non-members, at 20-25 per cent higher rates than MSP.
“The open market price for the Sathaka variety of paddy, for instance, is Rs 8-12 per kg and we buy it at Rs 21 per kg,” says Shashank Guwalani, lead of operations, Bhoomgadi.
“The FPO gives fair prices on all crops, with premium prices for aromatic and medicinal rice varieties. It buys produce round the year. This has enhanced income,” says Surendra Nag, an organic farmer of Kasoli village in the district.
“The cost of 1 kg of rice is about Rs 55 after factoring in transportation, storage, and milling. We then sell it for Rs 65,” he adds.
The FPO accrues a profit of 15-30 per cent on maximum retail price, depending on the commodity, sale model and quantity.
While it recorded a nearly five-fold growth within a year of its inception, there have been dips in the turnover due to the government offering improved MSPs and COVID-19 (see ‘On a steady track’,).
But it expects growth exceeding 25 per cent over the previous year.
From 10 members in two-three village in 2016-17, Bhoomgaadi’s membership has grown to 2,727 members from 122 villages in 2020, with another 316 currently in the process of joining.
The increase in income has prompted farmers to raise efforts to improve livelihoods. They find that reduced input costs,
better yields, and greater control over farming decisions with regenerative practices decrease cultivation costs and increase earnings.
Over the past five years, farmers have undertaken capacity-building exercises, organised by Bhoomgadi.
“We were taught how to make organic manures and remedies to get rid of pests and diseases, along with techniques like Systemic Rice Intensification (SRI) and mixed farming,” says Balram Singh Thakur of Balud village.
In SRI, paddy is sowed at measured distances of 22.86 cm (9 inches). It reduces water needed to irrigate the crop and deters pests. Kamal Singh Nag, a farmer from Bichauli village, says the technique has helped decrease labour costs and time.
In 2016, he sold 1,000-2,000 kg of paddy; this rose to 4,500 kg in 2020—earning him roughly Rs 82,300 more.
The FPO invites experts to educate farmers, and sends members to training centres and other states to learn new techniques. Anand Netam, deputy director of agriculture, Dantewada, says, “Bhoomgaadi reaches places that the state fails to reach.
Farmers in deep pockets of the land find it hard to work with government officials, but they respond well to the FPO.”
To ensure nutrition and food security, Bhoomgaadi emphasises on crop diversification. Although the quantity produced so far is too low to be procured, residents have started consuming more fruits and vegetables.
While this shift in diet has not been studied so far, they report some changes. “I feel more energetic and can work for longer hours now,” says Chandrasekhar Singh, a farmer from Balud village.
The lessons learnt so far have helped Bhoomgaadi identify areas for future growth. For instance, the number of rice varieties marketed has been reduced from 100 to 25-30, in line with demand.
Similarly, to streamline collection, the FPO has launched 23 procurement centres at the cluster level, in lieu of procuring produce from farmers’ doorsteps. It is working to upscale its processing unit, with plans for a better manufacturing facility and training centre.
The FPO is also working to shift from catering to business and governments to reach consumers directly. However, Badave admits this would be a challenge, as although Bhoomgaadi has received adequate support, FPOs typically see poor funding and hand-holding assistance.
Hiring human resources is also a challenge. Transportation is another concern, says Gulawani. “The nearest town to Dantewada with better connectivity is Jagdalpur, 80-90 km away.
Shipping costs render online sales unviable.” The district has a low literacy rate and finding a skilled workforce is difficult.
Certification for organic produce also sees hurdles. The FPO uses the Participatory Guarantee System. “Dantewada has low internet penetration. Most farmers do not have proper land records.Both are needed for th certification,” says Jaswinder Singh, lead of organic certification at the FPO.
It seeks to register the villages for Large Area Certification (LAC) under Paramparagat Krishi Vikas Yojna. “LAC requirements are simple and the area can be certified almost immediately,” says Badave. It is looking at third-party certification as well. “But the regulatory system is a bit unfair towards organic farming,” he adds.
(This is the first in a series of multiple reports that show how better market access to non-chemical produce is key to the success of regenerative agriculture)
This was first published in the 1-15 August, 2022 edition of Down To Earth