Working Performance of HOPCOMS- in Karnataka an Analysis  

Krishna K.M. , S. Mokshapathy
Agri Business Management, Institute of Development Studies, Manasagangothri, Mysore-06, India
Author    Correspondence author
International Journal of Horticulture, 2013, Vol. 3, No. 20   doi: 10.5376/ijh.2013.03.0020
Received: 19 Aug., 2013    Accepted: 13 Oct., 2013    Published: 18 Oct., 2013
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This is an open access article published under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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Krishna et al., 2013, Working Performance of HOPCOMS- in Karnataka an Analysis, International Journal of Horticulture, 2013, Vol.3, No.20 114-120 (doi: 10.5376/ijh.2013.03.0020)

Abstract

Horticulture sector encompasses a wide range of crops e.g., fruit crops, vegetable crops, potato and tuber crops, ornamental crops, medicinal and aromatic crops, spices and plantation crops. India, with its wide variability of climate and soil, is highly favourable for growing a large number of horticultural crops. It is the fastest growing sector within agriculture. It contributes in poverty alleviation, nutritional security and have ample scope for farmers to increase their income and helpful in sustaining large number of agro-based industries which generate huge employment opportunities. Presently horticulture contributes 28% of agricultural GDP. The national goal of achieving 4.0% growth in agriculture can be achieved through major contribution from horticulture growth. Karnataka occupies a prominent place in the Horticulture map of the country. Horticultural crops occupy an area of 17.25 lakh ha. with an production 130.26 lakh tones. Although the area comprises only 14.44% of the net cultivated area in the state, the total income generated from the horticulture sector accounts to over 40% of the total income derived from the combined agriculture sector. This accounts for 17% of the GDP of the state. Horticulture provides excellent opportunities in raising the income of the farmers even in the dry tracts. A significant shift towards horticulture is evident in the state with an increase in area and production. Horticulture provides higher unit productivity and offers great scope for value addition and this sector is taking inroads throughout the length and breadth of the state. Karnataka having the highest acreage under dry farming in the country next only to Rajasthan, has a great potential to grow high value but less water demanding horticultural crops. Karnataka is a progressive state in the field of modern horticulture in the country. The diverse agro-ecological conditions prevailing in Karnataka has made it possible to grow different types of horticultural crops such as fruits, vegetables, flowers, spices, plantation crops, root and tuber crops, medicinal and aromatic crops. Horticulture Producers’ Co-operative Marketing and Processing Society Ltd. (HOPCOMS) was founded in 1959 Under a name of Grape Growers Marketing and Processing Society, under the guidance of Dr. M.H. Mari Gowda, the then Director of the Department of Horticulture under the Indian Co-Operative Society Act.

Keywords
HOPCOMS; Farmer & consumers

India is an agriculture based country. Hundreds of fruits and vegetables types are grown in all parts of India. Fresh fruit and vegetable reach small scale fruits vegetables suppliers, they are then sent to local markets as well as fruits and vegetables exporters. While there are almost 180 families of fruits that are grown all over the world, citrus fruits constitute around 20% of world’s total fruit production. Major Indian fruits consist of mango, banana, citrus fruits, apple, guava, papaya, pineapple and grapes. The fruits are processed into various products such as fruit juices & concentrates, canned fruit, dehydrated fruit, jams & jellies etc.

India with its current production of around 32 million MT of fruit, accounts for about 8% of the world’s fruit production. The diverse agro-climatic zones the country make it possible to grow almost all varieties of fresh fruits and vegetables in India. The fruit production in India has recorded a growth rate of 3.9%, whereas the fruit processing sector has grown at about 20% per annum. However, the growth rates have been extensively higher for frozen fruits & vegetables (121%) and dehydrated fruits & vegetables (24%). There exist over 4000 fruit processing units in India with an aggregate capacity of more than 12 lakh MT (less than 4% of total fruits produced). It is estimated that around 20% of the production of processed fruits is meant for exports, the rest caters to the defense, institutional sectors and household consumption, Mango and mango-based products constitute 50% of exports.
India is the second largest producer of vegetables in the world (ranks next to China) and accounts for about 15% of the world’s production of vegetables. The current production level is over 71 million MT and the total area under vegetable cultivation is around 6.2 million hectares which is about 3% of the total area under cultivation in the country. In case of vegetables, potato, tomato, onion, cabbage and cauliflower account for around 60% of the total vegetable production in the country. Vegetables are typically grown in India in field conditions, the concept is opposed to the cultivation of vegetables in green houses as practiced in developed countries for high yields. The fruit and vegetable processing industry in India is highly decentralized. A large number of units are in the cottage/home scale and small scale sector, having small capacities upto 250 tonnes/annum. But big Indian and multinational companies in the sector have large capacities in the range of 30 tonnes per hour or so. Since liberalisation and withdrawal of excise duty on fruit and vegetable products there has been significant rise in the growth rate of the industry
India’s economic security continues to be predicated upon the agriculture sector, and the situation is not likely to change in the foreseeable future. Even now, agriculture supports 58% of the population, as against about 75% at the time of independence. In the same period, the contribution of agriculture and allied sector to the Gross Domestic Product (GDP) has fallen from 61 to 19%. As of today, India supports 16.8% of world’s population on 4.2% of world’s water resources and 2.3% of global land. And per caput availability of resources is about 4 to 6 times less as compared to world average. This will decrease further due to increasing demographic pressure and consequent diversion of the land for non-agricultural uses.
According to National Horticulture Board the main fruits grown in India are apple, banana, lime/lemon, mosambi, orange (mandarin), grapes, mango and papaya. In case of vegetables, potato, tomato, onion, cabbage and cauliflower account for around 60% of the total vegetable production in the country. Vegetables are typically grown in India in field conditions; the concept is opposed to the cultivation of vegetables in green houses as practiced in developed countries for high yields. Only 2% of these crops are processed into value-added products. Hence, there is a need for maximum commercial utilization of fruits and vegetables and to adapt production and marketing activities to the requirements of the world market and to cater to domestic demand which, over the past few years, has been increasing because of various socio-economic factors. If the nutritive value of the processed food products could be maintained, this sector would emerge as a major value-added food industry.
There are over 4000 fruit processing units in India with an aggregate capacity of more than 12 lakh MT (less than 4% of total fruits produced). It is estimated that around 20% of the production of processed fruits is meant for exports, the rest caters to the defense, institutional sectors and household consumption. Mango and mango-based products constitute 50% of exports.The fruits and vegetables considered important by the Horticulture Board of India are mostly grown in the areas of Jammu & Kashmir, Himachal Pradesh, hilly regions of North Uttar Pradesh, Tamil Nadu, Maharashtra, Karnataka, Gujarat, Andhra Pradesh, Assam, Madhya Pradesh, Rajasthan, Punjab, Tripura, West Bengal and Orissa.
Horticulture in Karnataka
Karnataka occupies a prominent place in the Horticulture map of the country. Horticultural crops occupy an area of 18.00lakh ha. With an production 136.38 lakh tones. Although the area comprises only 14.44 per cent of the net cultivated area in the state, the total income generated from the horticulture sector accounts to over 40 per cent of the total income derived from the combined agriculture sector. This accounts for 17% of the GDP of the state. Horticulture provides excellent opportunities in raising the income of the farmers even in the dry tracts. A significant shift towards horticulture is evident in the state with an increase in area and production. For instance, about 58,000 ha. area has been brought under horticultural crops through the watershed programmes. Horticulture provides higher unit productivity and offers great scope for value addition and this sector is taking inroads throughout the length and breadth of the state. Karnataka having the highest acreage under dry farming in the country next only to Rajasthan, has a great potential to grow high value but less water demanding horticultural crops.
The area of Karnataka is 190.50 lakh ha. Of which an area of 125.63 lakh ha. Come under the cultivable area constituting 65.95% of the geographical area for the year 2010-2011. Out of the total cultivable area, 19.01 lakh ha. Area covered under horticulture, as per the “Horticulture Crop Statistics of Karnataka State At A Glance 2010-2011”. Horticulture area in the state accounts about 15.14% of the total cultivable area. Out of 19.01 lakh ha. Of the total horticulture cropped area 8.21 lakh ha. (43.17%) come under Plantaion crops: 4.38 lakh ha. (23.03%) under Vegetable; 3.54 lakh ha. (18.61%) under Fruits; 2.57 lakh ha. (13.51%) under Spicesand 0.32 lakh ha. (1.69%) under Commercial Flowers, including the area under the Medicinal plants.
The total horticulture production in the state during the year under reference figures is 152.13lakh tons (Table 1). The production figures at 61.33 lakh tons (40.31%) with respect to Fruits Crops; 73.80 lakh tons (48.51%) w.r.t Vegetables Crops; 9.99 lakh tons (6.57%) w.r.t Spice Crops; 8.21 lakh tons (3.17%) w.r.t Plantaion Crops; and 2.19 lakh tons (1.44%) w.r t crops coming under commercial Flowers, including the area under the medicinal and aromatic plants.The total are is 218.24 lakh hectares and production is 2404.26 lakh tons under horticulture crops in india. Karnataka state has occupied 3rd place in respect of total area with 18.66 lakh hectares contributing to 8.60% area to total area and 6th place in respect of total production with 177.98 lakh tons contributing 7.4% production to total production at all india level. Karnataka state has occupied 3rd place regarding Fruits crops with as area of 3.78 lakh hectares & production of 62.74 lakh tons and 8th place regarding Vegetables crops with 4.66 lakh hectares of area & 90.56 lakh tons of production. With regard to commercial flowers our state has stood in 2nd place with 0.27 lakh hectares of area and 2.04 lakh tons of production and 2nd place regarding plantation crops with 7.32 lakh hectares of area and 17.81 lakh tons of production.


Table 1 Area and production of horticultural crops in Karnataka (2010-2011)

Objective of the Study: To examine the existing pattern of HOPCOMS; To study the Procurement & Distribution of Marketing of Fruits and Vegetables by HOPCOMS; To study the various facilities provided by HOPCOMS to Farmers and Consumers.
Methodology
The study is based on secondary data. The secondary data has been collected from HOPCOMS, and NHB, Bangalore. The collected data has been analyzed by adopting compound growth rate model and simple tabular analysis. The secondary data has been collected from 1999-2000 to 2012-2013.
In karnataka: an overview
The Horticulture Producers’ Co-operative Marketing and Processing Society Ltd. Popularly called as HOPCOMS was established with the principal objective of establishing a proper system for the marketing of fruits and vegetables, to benefit both the Producers the consumers. Prior to the establishment of HOPCOMS, no proper system marketing of horticulture produce was in existence. Farmers were in the clutches of the middlemen and the whole system was benefited the middlemen neither the farmers nor the consumers.
Horticulture Development in the Mysore state in 1932. The first Horticulture farm was started at Maddur in 1942, to demonstrate the cultivation of Horticulture crops and production of vegetable seeds and planting material for the farmers. Marketing of highly perishable commodities like fruits and vegetables has always caught with problems. Farmers often have little bargaining power, middlemen collect commissions from producers, and there was a frequent delay in payments, and produce sold on the basis of volume, with prices being determined to the advantage of retailers and not the farmers. In order to tackle these issues the Horticulture Producers’ Co-operative Marketing and Processing Society Ltd. (HOPCOMS) was founded in 1959 Under a name of Grape Growers Marketing and Processing Society, under the guidance of Dr. M.H. Mari Gowda, the then Director of the Department of Horticulture under the Indian Co-Operative Society Act. The member comprise farmers, state financial organizations and the Karnataka State Government.
It is managed by official’s appointment by the state, drawn from the Department of Horticulture and the department of Co-operation. As of 2007 there are 17 HOPCOMS in the state, each working independently with in demarcated districts of operation.
It had jurisdiction over Bangalore, Kolar, Mysore, Tumkur, Mandya and Mangalore districts. Since grape was a seasonal fruit, the society started handling all types of fruits and vegetables from 1965. Due to this change in operations, the name of the society was changed into Horticulture Producers Co-operative Marketing and Processing Society Ltd. From 10th Sep 1959 its registered office is located at Lalbagh, Bangalore. Later, Govt. has declared the HOPCOMS as the unit of Horticulture department in January 2009.
Composing of HOPCOMS Board
The Board of HOPCOMS consists of 20 members. In which 11 members are elected from among the producers, and the rest are the Govt. nominees. The President and Vice President are elected among producers only. The Managing Director of HOPCOMS is from of the Horticulture Dept. on a lent service (Deputation).
Composition of Membership of HOPCOMS
The HOPCOMS has 16221 growers as members, with a share capital of Rs. 265.01 lakhs. as on 31.03.2012.
HOPCOMS Staff (as on 2012&2013): At present HOPCOMS has 916 staff members under different work.
Aims and objectives of HOPCOMS
The main objective of HOPCOMS is to promote and encourage the development of horticultural produces with following support. (a) By training & providing technical advice literature on Horticultural crop. (b)By providing inputs implements plants and grafts etc., (c) Providing marketing facilities and organize the proper studies to members of HOPCOMS. (d) Supply of Horticultural produces to all major Factories, Hostels, Hospitals, Clubs, and Social functions etc., (e) Providing internal commodities exchange facilities to co-op.societies & Branches.
Turn-Over HOPCOMS:
At present, HOPCOMS is handling about 90-100 M T of fruits and vegetables every day, Nearly 200 farmers are bringing their produces directly to HOPCOMS every day. Soon after produces arrived at HOPCOMS, it is graded, weighed and cash payment up to 5,000/- is made immediately to the procures. Above 5,000/- to 10,000/-payment will be made by Cheques. Out of total procured quantity, about 80% is distributed & disposed of through outlets, 15% to institutions and the rest 5% to Govt. Hostels.The retail outlets are being managed by the salesman who are the employees of HOPCOMS. As incentives, they are allowed to absorb driage and damage to the extent of 3.7% of the value of the produce besides wages. Every day the salesman will remit the sales proceeds of the previous day and collect the materials required for the day’s sales from the Central procurement center. The supplies to retail outlets are being made through the 30 own and through hired vehicles.
Area of operations
At present Bangalore HOPCOMS operating in Bangalore urban, Bangalore Rural, Kolar, Chikkabalapura, Channapatana & Ramanagara Districts.
How prices are Fixed at HOPCOMS
The APMC markets play a major role in setting market trends and prices. The prices at which HOPCOMS buys the produce from the farmers is based on the rates and prices released APMC. The HOPCOMS employee’s collects the maximum, minimum and model prices for the various commodities sold at previous day in the APMC markets published in the newspaper. Based on the rates released by APMC, HOPCOMS fixes the procurement and sale price for different Fruits and Vegetables brought fro sale by its member. The prices produce are vary from day to day and from hour, to hour in private markets such as Singshandra market for Fruits, K R Market for Vegetables, Yashavanthpura market for Food grains.
Clarity is person the whole mechanism of price fixation for various Fruits and Vegetables at HOPCOMS.
Infrastructural Facilities available at HOPCOMS
The HOPCOMS is having the following infrastructural facilities for marketing of Fruits and Vegetables. No. of Retail outlets:286, No. of Chemical & fertilizers :10, No. of Cold storages:01, No. of Vehicles :30, No. of Processing units:01, No. of Walk –N-Cooler:02, No. of Grading unit:01, No. of Procurement Center :07, No. of Godowns:03.
Distribution outlets of HOPCOMS
HOPCOMS distributing various Fruits and Vegetables products through following points.
No. of Retail outlets: 286, No. of Hospitals :     17, No. of Factories : 26, No. of Host.Clubs, Insti26
HOPCOMS undertake supply of Fruits and Vegetables to directly to marriages and other function on demand.
Procurement & Payment Process at HOPCOMS
HOPCOMS enroll farmers as its members issues purchase indent to those members specifying the quantity of Vegetables to bring to the procurement center at Bangalore or other districts center. Producer will be verified weighed aid issued a receipt and the same presented to the payment officer who in turn issue a cash voucher which will be encased immediately at the bank located at the centers its of same day.
Other Activates of HOPCOMS
The society has set up a unit for preparing fresh fruits drinks out of fruits like Bangalore Blue grapes, mango, oranges etc. It is selling the same to the general public at a reasonable price of Rs.5/- per 200 ml bottles through its retail outlets, and through dispensers located at impotent places. The HOPCOMS help its member farmers by supplying Fertilizers, plant protection chemicals, garden implements, seed etc, through its own center located at procurement centers.
Damages and wastage of Fruits and Vegetables at HOPCOMS
Fruits and Vegetables being highly perishable products losses due to driage and wastages is obvious. Driage and wastage at HOPCOMS is around 4~5% of the total procurement of the produce. Howerer, Driage and wastage has been reduced from 4.32% of the total procurement to 1.85% .at present.
Source of Financial assistance to HOPCOMS
For the development of HOPCOMS following institutions are involved -1) Zilla Panchayath, Bangalore urban / Rural Districts provided financial assistance of Rs.11.97 Lakhs. 2) N H B Provided Rs.28.18 Lakhs as grants and Rs.1.08 Lakhs as loan for construction of each retail stall, procurement centers and vehicles. The amount has been utilized for the purpose and the loan was also fully repaid. Considering the facilities rendered by HOPCOMS during 1990-91 the Karnataka Sate Govt.NCDC, Sanctioned Rs.448 Lakhs for construction of 6 central godowns, 21 procurement centers, 165 retail stall and purchased 24 vehicles and installed 1 processing unit. The entire loan amount Rs.215 Lakhs with interest Rs.225.54 Lakhs has been fully repaid by the HOPCOMS.
Facilities Extended by HOPCOMS to farmers:
HOPCOMS is offering multifarious facilities to the farmers. HOPCOMS purchase the Horticulture produces directly from farmers at remunerative prices; Provide transport facilities from collection centers to HOPCOMS procurement; Correct weighment & immediate cash payment; Arrange for essential input supply Fertilizers, plant protection chemicals, garden implements, seed etc, at reasonable prices; Arrange subsidized supply of plastic crates to its farmer members for handling fruits and vegetables; Supply of seeds under subsidized rates; Conducting farmers tours and technical guidance; Conducting Training on production and processing of Horticultural crops; Providing Accommodation for night stay at Gets House; Providing Canteen and banking facilities; Guaranteeing Minimum support price during distress sales under Govt schemes; Extending (financial) Assistance for preliminary processing activities.
Facilities to Consumers:
Supply of Fresh and Quality fruits and vegetables at reasonable price; Ensure correct weighmen; Established Retail outlets in extentions; Providing Mobile sales; Supplying fruits and vegetables to marriages and social functions in spot with Free transportation; Offering Bulk supply of Fruits and Vegetables to institution, Organization, Hostels, Hospitals, & factories etc at competitive price; Offering fresh Grape, Orange, Mango fruits drinks at reasonable prices in 200 ml battles; Conducting seasonal fruits Melas, Fares and Festivals of Grapes, Mango, fruits – fare at discount rates at cities to promote fruits sales ensuring better returns to farmers and fresh and quality products at reasonable prices to consumers (Table 2; Figure 1).


Table 2 Year wise total quantity procurement, marketing & tarwavar form HOPCOMS of fruits & vegetables (1999-2013)


Figure 1 Year wise total quantity procurement, marketing & tarwavar form HOPCOMS of fruits & vegetables (1999-2013)

Conclusion
Through HOPCOMS, the government has invested large amount of resources in marketing of horticultural produce in the city of Bangalore and in several other cities of Karnataka. While the proportion of total produce that HOPCOMS picks up is small compared to the total amount used in Bangalore city,a good example, both in terms of the prices that it offers farmers, as well as the quality and prices that if offers to customers Even though it deals with only a small part of the total horticultural produce in the city of Bangalore, HOPCOMS sets the prices in the market. Both farmers and customers have come to accept the price set by HOPCOMS as fair.
One of the best and tremendous jobs of HOPCOMS is helping farmers, in case if they have additional production HOPCOMS will help them to sell in open market by providing transportation facility without charging anything.
Howerer we must appreciate the price mechanism adopted in HOPCOMS .it acts as middle man between farmers and consumers to collect HOPCOMS are market leader in fixing an accurate and correct price for fruits and vegetables.
References
A Brief note on HOPCOMS, Horticulture Department, Lalbagh Bangalore(2009-2010)
Devaraja T.S., 2000, Performance of HOPCOMS, Karnataka – an economic evaluation, Indian Cooperative Rev., 38(2): 82-96.
Indian Horticulture Data Base, 2010, mportance and Scope of Horticulture National Horticulture Board Ministry of Agri. Govt.of India.
JosephM., SoundarajanN., GuptaM., and S. Sahu,2008, National Economic Relations, retriever from.
S. Narayanaswamy, 1998, A Case study of Mysore Horticulture Society
Singh, and Mahesh Kumar, 1985, Price Spread of Vegetables marketing


SubbanarasaiahN., 1991, Marketing of Horticultural Crops in india

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