Introduction to APMC and its functions

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APMC Mandi

In a spot market, goods are sold for cash followed by immediate delivery and price settlement takes place on the spot while price determination is based on the pure forces of demand and supply. All APMC mandis are examples of the spot market. The APMC or the Agricultural Market Committee is one of the agricultural commodity market regulators, which has been constituted in accordance with the laws of the APMC for the management of agricultural markets.

Most state and union governments have enacted laws (Agricultural Marketing (Regulation) Act (APMC Act) to regulate markets for agricultural commodities. Some of the rural primary markets have been regulated over time. years, in order to achieve an efficient system of buying and selling agricultural products.

There is a primary market for many regulated wholesale markets, characterized by large size and relatively better infrastructure. There are a number of sub-yards which are attached to the main market. The establishment of regulated markets has helped to create orderly and transparent marketing conditions on the primary aggregation markets. In 2014-2015, there were approximately 2,477 main regulated market yards on the basis of geography (APMCs) and 4,843 sub-market yards regulated by the respective APMCs. At the time of independence, there were only 286 meters.

OBJECTIVES OF THE APMC

  • Provide a healthy environment for the normal functioning of the forces of supply and demand.

  • Guarantee reasonable profit margins for producers or farmers.

  • Prevent market malfeasance.

  • Promotion of market competition

  • Provide the necessary facilities for an appropriate infrastructure

  • Ensure transactions are conducted in a transparent manner

RESPONSIBILITIES AND FUNCTIONS OF THE APMC:

  • Ensure transactions taking place in the market area

  • Focus on full transparency of the pricing system

  • Ensure payment for agricultural products sold by farmers on the same day

  • Promotion of public-private partnership in the management of agricultural markets.

  • Promotion of agricultural transformation, apart from the activities of valuing agricultural products.

  • Publish the data concerning the arrivals of agricultural products in addition to their prices, put on sale in the market area.

  • Appoint the general manager of the market committee from among the professionals chosen from the free market.

With regard to the governance of APMCs, the mandis are managed by a board of directors, which is under the supervision of the state marketing board or the council of mandi. Elected directors are usually representatives of farmers but are sometimes appointed by state governments. The day-to-day operation and administration of the market is managed by the board of directors with nominal fees which it collects from market participants.

HOW APMC WORKS:

The APMC negotiates in two ways: negotiated trade and auction trade. In a traded trade, sellers approach traders for a quote and this trade usually refers to a traders market. Before arriving at a mutually agreed price, the price is either accepted or negotiated. In an auction business, a commodity is sold using the open auction method and refers to an open auction market. Here, local supply and demand determine the price of the product. The auction is facilitated by an APMC official or a professional auctioneer.

Regarding the clearing of transactions, agreements are made with buyers / sellers immediately after the transaction and the buyer should inspect their production for quality and quantity, at the time the transaction is cleared with the seller. At the end of the trading day, the price paid and volumes are reported and the trader then pays the fees or taxes.

Farmers bring their produce from the fields to the nearest APMC for sale. Once the products are brought in, the traders then sell the goods to the buyers. Since there are no long-term storage facilities in the market courtyard, APMC allows traders to keep the products in the courtyard overnight in case the products are not sold on the same day. . In this way, APMC facilitates trade settlements and any dispute over product quality that arises after delivery is between the trader and the buyer / seller, once the trade settlement is concluded.

The trader pays two types of fees – basic transaction fees which include a fraction of the value of the volumes traded. The second tax is in the form of taxes. Market fees can vary widely from state to state. Intermediaries such as brokers, wholesalers, sub-wholesalers, auctioneers, packers, sorters and laborers are the other market participants, except regular buyers and sellers, who participate in the market. trade facilitation. To participate in the auction, a buyer has a license issued by the APMC.

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