Are Marketing Intermediaries Exploiting Hill Farmers in India? An Economic Analysis of Vegetable Supply Chains in Himachal Pradesh

Against the backdrop of viewing marketing intermediaries in developing countries as parasites, this study has examined the validity of such a view, especially in the context of off-season vegetables marketing in a mountain area of Himachal Pradesh. The study is based on a sample of 60 vegetable growers drawn from 5 villages and 30 market intermediaries drawn randomly from eight different state and inter-state markets where the produce was sold. The information was collected from all major stakeholders such as farmers, farmers’ marketing groups (FMGs), commission agents and retailers. The study has identified six marketing channels, four traditional and two modern involving farmers’ marketing groups (FMGs). Among different middlemen, the retailers earned the exorbitant margins ranging from 14.7 per cent to 19.3 per cent. The study has revealed that taking the advantage of weak bargaining power and poor market accessibility, market intermediaries especially, retailers, exploit the hill farmers. The study has made some policy recommendations to encourage, institutionalize and strengthen the modern farmers marketing groups (FMGs) to address these inherent problems.