Agricultural Produce Market Committee

Under the Agricultural Produce Market Committee (APMC) Act, 2003, the Agricultural Produce Market Committee (APMC) is a statutory body constituted by state government in order to trade in agricultural or horticultural or livestock products.

Functions of APMC

Functions of APMC are:

1. To promote public private partnership in the ambit of agricultural markets.
2. To provide market led extension services to farmer.
3. To keep an eye on  pricing system and transactions taking place in market in a transparent manner.
4. To ensure payments to the farmers for the sale of agricultural produce on the same day.
5. To promote agricultural activities.
6. To announce data on arrivals and rates of agricultural produce from time to time into the market.

Intra state trade fall under the ambit of State due to which Agricultural Market is a state subject under the constitution of India. Thus the state APMC Act mostly regulates the Agriculture Market. Supervision is done by the Market Board which is constituted by the state.  APMCs generally consist of representatives of farmers, traders, warehousing entities, registrar of cooperative societies etc. Market Boards basically consists of chairmen of all APMCs, representatives from the relevant Government Departments etc.  No person or agency is allowed to freely carry on wholesale marketing activities once a particular area is declared as a market area and falls under the jurisdiction of a Market Committee.

The taxes, fees/charges and cess are levied on the trades conducted in the markets are also notified under the APMC Act.  APMC charges a market fee from buyers, and a licensing fee from the commissioning agents who mediate between buyers and farmers.

Issues

The APMC was though constituted to prevent and to protect farmers from exploitation from intermediaries, traders and timely payment of their produce through auctions in the APMC area, yet there are several issues. The agricultural produce can be traded through APMCs only and there is a restriction on the farmer from entering into direct contract with any processor/ manufacturer/ bulk processor. This has resulted in multiple levels of brokers and farmers are unable to get fair prices.  Further, there are major drawbacks of this committee like no scrutiny is done, agents together forms a cartel for trade, members and chairmen were elected by the agents . This monopoly has restricted the development of a competitive marketing system providing no help to farmers in direct marketing, organizing retailing, a smooth raw material supply to agro-processing industries and adoption of innovative marketing system and technologies.