Farmer Producer Organization

1. Opportunities for Farmer
Producers Organizations in
Tamil Nadu
Presented by Dr. J. Diraviam
Programme Coordinator
Krishi Vigyan Kendra, Karur

2. “Farmers’ organizations should be
promoted to combine the advantages of
decentralized production and centralized
services, post-harvest management, value
addition and marketing” - National Commission
on Farmers (NCF), 2004.
“Farmers’ Organizations (FOs) are essential
institutions for the empowerment, poverty
alleviation and advancement of farmers and
the rural poor” - (FAO,2006)

3. Concept of Farmers Producer
Organizations (FPOs)
• Farmers Producer organizations are
groups of rural producers coming together
based on the principle of membership, to
pursue specific common interests of their
members and developing technical and
economic activities that benefit their
members and maintaining relations with
partners operating in their economic and
institutional environment
(Anonymous.2004).

4. Farmer Producer Organizations : Features
• Common interest
• Dynamic and flexible, norms and operating
procedures
• Both long and short term objectives and plan of
action
• Enrolment through membership fee
• Democracy through regular elections
• Clear and transparent transactions
• Capacity of the organization should be strong to
ensure its long term stability and sustainability
• Linkages and network with other Farmer Producer
Organizations
• Committed leadership

5. Why Farmers Producers
Organizations?
• Farmers Producers Organizations influence policies
and demand for required services.
• Farmers can participate in the decision making
process of the developmental activities.
• Service system becomes more effective and
accountable
• They get better access to latest markets and
technology
• FPOs can involve in Farmer and market led
extension activities

6. Why Farmers Producer organizations ?
• Build interactions between research,
extension and farming systems
• Enable farmers to organize themselves for
action or to share resources
• Analyze farmers problems with extension
support
• More services can be made available to
farmers through a single point
• Provide more effective learning environment

7. Role of
Farmer Producer Organizations
• Representational role
• Technology role
• Service role

8. Types of Farmer Producer Organizations
Community based, resource
oriented Farmer Producer
Organizations
Commodity based, market
oriented Farmer Producer
Organizations

9. THE COMPANIES
(AMENDMENT) ACT, 2002
• “Producer Company” means a body
corporate having objects or activities
specified in section 581B and registered
as Producer Company under this Act

11. Objects of Producer Company
• Every Producer Company shall deal
primarily with the produce of its active
Members for carrying out any of its objects
specified in this section.

12. Objectives of the Producer Company shall
relate to all or any of the following matters:
(a) production, harvesting, procurement, grading,
pooling, handling, marketing, selling, export of
primary produce of the Members or import of
goods or services for their benefit: provided that
the Producer Company may carry on any of the
activities specified in this clause either by itself
or through other institution;
(b) processing including preserving, drying,
distilling, brewing, venting, canning and
packaging of produce of its members;

13. (c) manufacture, sale or supply of machinery,
equipment or consumables mainly to its
Members;
(d) providing education on the mutual assistance
principles to its Members and others;
(e) rendering technical services, consultancy
services, training research and development and
all other activities for the promotion of the
interests of its Members;
Objectives of the Producer Company

14. Objectives of the Producer Company
(f) generation, transmission and distribution of
power, revitalization of land and water
resources, their use, conservation and
communications relatable to primary produce;
(g) insurance of producers or their primary
produce;
(h) promoting techniques of mutuality and mutual
assistance;
(i) welfare measures or facilities for the benefit of
members as may be decided by the Board.

15. Objectives of the Producer Company
(j) any other activity, ancillary or incidental to any
of the activities referred to in clauses (a) to (i) or
other activities which may promote the principles
of mutuality and mutual assistance amongst the
Members in any other manner;
(k) financing of procurement, processing,
marketing or other activities specified in clauses
(a) to (j) which include extending of credit
facilities or any other financial services to its
Members.

16. Steps involved in Registration of
Producer Company
1.Digital Signature Certificate (DSC)
2.Director Identification Number (DIN)
3.Naming of a Producer Company
4.Memorandum and Articles of Association
5.Documents to be submitted to the ROC
6.Certificate of Incorporation and Power of
Attorney
7.Tasks to be completed immediately after
incorporation

17. Input supply
(Seed, fertilizer,
machinery)
Financial & technical
(Credit, savings,
insurance, extension)
Marketing linkages
(contract farming,
procurement under MSP)
Training and Networking
(HRD, policy advocacy,
documentation)
FPO
Farmer Producer Organizations (FPOs)
Typical range of services provided

18. How FPOs benefit small producers
1. Aggregating smallholders into FPOs proven
pathway to increase investment, improve
bargaining power, move up value chains and
improve access to technology, markets.
2. Aggregation only way to enable SMF to exploit
emerging opportunities domestic and global by
integrating with SMEs; retail chains
3. Climate change coping mechanisms and risk
mitigation requires aggregated platforms for
efficient delivery
4. Aggregation will facilitate more effective targeting
of subsidies to farmers 18

19. Opportunities for FPOs – Nadayanur
Agricultural Producers Co. Ltd.
• Inputs dealership – Fertilizers and pesticides
• Farm implements – custom hiring
• Cattle feed and raw materials for feed
preparation
• Tapioca – starch measuring scale
• Copra and shell direct procurement and sale
• Milk purchase and retail sale (additional price
of Rs 5/lit.)

20. Opportunities for FPOs – Nadayanur
Agricultural Producers Co. Ltd.
• Procurement and sale of organic jaggery
• JLG formation and credit linkage for milch
animals
• Training programmes on Azolla cultivation,
livestock (ethnovet practices) and Coconut
through – VUTRC, KVK, Vivekananda
Kendra

22. Vellingiri Uzhavan Producer Company
• Direct harvesting and dehusking of coconut
– teams developed and direct sale in
Kangeyam
• Drying yard for Copra
• Inputs dealership – Fertilizers and
pesticides – wholesale and retail licences
obtained
• Farm implements – custom hiring only for
members – JCB, tractor

23. Vellingiri Uzhavan Producer Company
• Kisan Credit Card for all members –
organized
• Farm Advisory services, soil testing,
trainings arranged and Market information
provided through SMS.
• Future plans: Coconut Oil production and
sale in domestic market, forward and
backward linkages for Arecanut

24. Theni Banana Producers Company Ltd.,
• Incorporated a Company named ad 'Farm
Fresh Banana Pvt Ltd' and established
600 MT cold infra, ripening chambers and
Pack Houses. Income of the farmers have
gone up from Rs.1 lakh to 2.5 lakhs / acre.
The entire production system has gone
Hi-Tech to generate uniform fingers and
hands and two container loads per week
are exported to European Market.

25. Erode Precision Farm Producer Company
Ltd.,
• Supply of quality inputs
• Technology support in vegetables production
with no residual toxicity.
• Established an Indian Oil Corporation Fuel
outlet under Kisan Seva Kendra Scheme to
benefit the farmers by supplying quality fuel
to farm machinery.
• Vegetables are being grown in 200 acres for
exporting to Maldives. The firm is having
dealership for 15 major companies including
M/s Jain Irrigation.

26. Dharmapuri Precision Farm Agro Services
Ltd.,
• Establishment of 12 registered vegetable
clusters for sharing the experiences and
visiting markets like Chennai, Cochin,
Azadnagar New Delhi, Pune and Nasik.
• Supply of quality inputs.
• Now, the company sells farm inputs,
arranges buy back tie-ups and conducting
market exposure visits to farmers. The firm is
having dealership for 7 major companies
including M/s. Jain Irrigation.

27. Cumbam Valley Grape Growers Company
Ltd.,
• Supply of quality inputs.
• Capacity building of farmers on Hi-Tech
farming.
• Establish pack houses at farm end and
retail outlets in Highways.
• Establish unit for processing and value
addition.

28. Ulavan Producer Company Ltd
• Electronic turmeric auction center at Erode for
maximum participation of traders and price
discovery in a transparent manner
• Grading, sorting, packing with total transparency
and issue of certificates of stocks against which
the farmers can avail bank loan.
• All communications and bidding shall be
through mobile and on-line.
• The future business plan includes establish units
for curcumin, oleoresen and curcumin powder.

29. Tamil Nadu Flower Growers
Association
(Under conversion to Producers Company)
• Daily price for the flowers is fixed by the
Association after ascertaining the demand
from Mumbai, Chennai, Bangalore,
Mysore, Dubai and UK.
• There is no commission collected from the
farmers and the payment is immediate.

30. Coimbatore District Vegetable Growers
Association
• Price for the gourds is fixed by the
Association once in fifteen days after
ascertaining the market demand.
• Direct Marketing through one market outlet
within Coimbatore City.
• Convergence: Participation in peri-urban
vegetable cluster project under National
Horticultural Mission for Coimbatore with
provision for packhouses, transport vehicles
and furnished retail market outlets within the
Coimbatore city for direct marketing.

31. Thiruvalluvar Farmers Producers
Company Ltd.,
• Supply of inputs
• The company's future business plan is to
produce and supply of quality inputs, build
up of the capacity of farmers for Hi-Tech
farming practices
• We plan for establishing a processing unit
for processing and value addition in
coconut .

32. Palaya Ayakkudi Koiyya Sagupadiyalarkal Sangam
(Ayakkudi Guava Growers Association
• Introduction of Hi-Tech Production system
for production of uniform sized fruits,
weighing 300 grams each.
• Better price realization by sorting and
packing for Gulf Market.
• Apart from Export, the major fruit retailers
of Coimbatore are buying regularly from
the farmers.

33. Tamil Nadu Mango Growers Federation
• The capacity building training was given on Organic
Farming, GAP certified farm and Grading and Packaging of
Mangoes.
• There are 3 GAP certified orchards in Tamil Nadu which
generates 3 times the profit of the conventional orchards.
The production system upgraded 100 % and many Ultra
High Density Plantations are established.
• Now, the federation is making effort to convert all the
association into Krishnagiri Mango Producers Company and
promote branded Mangoes as 'KrishMa' meaning
Krishnagiri Mango.
• Further, effort is on to establish retail market and own
pulping unit on the four lane roads of the state.

34. Nallakeerai
NALLA SANDHAI PRODUCER COMPANY
LIMITED
• Five Information Technology (IT) executives
have decided to enter into Agriculture on
leased lands exclusively to produce toxin free
organic vegetable greens for supply to
chennai metropolitan city.
• Direct marketing is the target and the
consumers preference is positive for the
produce, logistics are being worked out to
expand the area and make deeper in-roads
into city market.

35. Success of Farmer Producer
Organizations…
Recognition it gets from various bodies
Policies of Government
Focus on income generating activities
Abilities of members
Visible benefits to its members
Extension officials attitude and support
Participatory approaches
Linkages with people and organizations
Tie up with other development programmes
Inter group linkages
Capacity building of farmers

36. Ecosystem
for
sustainable
FPO
Marketing
EGCGFS
Infrastruc
ture
RetailingServices
(Technical)
Credit
HRD
Link to
Consultant
Banks
PHI/VIUC
GBY
VCA
NMFP
RKVY/PPIA
D
Retailers/Process
ors
MSP
NSPOT/NCDEX
SFI/GVT HR Plan
FPOs as sourcing
point for rural
products
FPOs as rural retail
points for consumer
products/services
CSC
Banks
NBFCs
Inputs
BDS/ERP
WHR
Mechanizatio
n
Krishidoot

37. Evolution of Producer Company in India
Producer
Company
Producer
Company
Corporates
Promoters:
NGOs, DDs,
Sponsors
Advisory service,
supply, Procurement,
Collective marketing
Stage I
Retail partnership
Stage II
Stage III
Producer companies
with own infrastructure
for processing, brand
identity and marketing

38. Summary
• The purpose of establishing Farmer Producer
Organization (FPOs) is to internalize extension
services for its members and provide: –
Backward linkage (input, credit and
technology) – Forward linkage (production
facilities, market and value addition).
• The FPOs provide an effective channel for
both dissemination of technology to large
number of small and marginal farmers and
feedback to research and extension.

39. Summary
• Producer companies can help smallholder
farmers participate in emerging high-value
markets, such as the export market and the
unfolding modern retail sector in India.
• In this environment of greater instability and
competition, organization and collective action
can help to enhance farmers' competitiveness
and increase their advantage in emerging
market opportunities.

40. Conclusion
• Sustainable organizations are must for over all
development
• Extension strategies should involve FPOs
• Public, Private extension agencies and NGOs
should involve FPOs
• Govt departments should play a supporting role
in formation and management of FPOs
• Extension functionaries should have skills of
facilitation

41. Thank You
Inauguration of Seed Processing Unit of Nachalur FPO by
District Collector and NABARD CGM