Covid-19: Farmers turn to FPCs to find a solution to financial crisis

Suresh Nakhate and his friends in Beed district are gearing up to launch a Farmer Producer Company (FPC) by bringing together farmers in drought-prone areas in an effort to make farming a profitable and sustainable business.

“It is high time farmers establish a value chain and find new markets for their produce. Cotton, custard-apple, soya, silk industry and Osmanabadi goat are some of the areas we are looking at. The effort is at the initial stage but we are confident that this is the way forward”, says Suresh.

Exit co-ops, enter farmer producer cooperatives

But it is not only Suresh and his friends who are looking at FPCs as the future for farmers and farming. Even as the lockdown induced by Covid-19 posed challenges to farmers in Maharashtra, young farmers and youth who have returned from urban areas are taking initiatives to form FPCs as an answer to the financial crisis faced by rural Maharashtra.

Inspired by success

Shailaja Narwade who, along with other women farmers in Osmanabad, started a producer company, says that farming is possible for small farmers only if they come together and do business as a company. “We have formed a chain of farmers who produce pulses. We have succeeded in getting market and price for our produce,” she says. Shailaja is encouraging other women to come together and start FPCs.

Young farmers are getting inspiration from already established FPCs. Recently, a Buldhana-based FPC gave a bonus to farmers after it sold maze worth ₹45 lakh in the market. Women in Sinnar (Nashik) came together and established Savitribai Phule Goat Farming Producer Company Ltd (SPGFPCL). Today every woman earns at least ₹10,000 per month and over 8,000 women are involved in the venture which is spread in 80 villages. This wholly women-owned enterprise has paid-up share capital of ₹22.7 lakh. The company is marketing goat milk in a big way to provide remunerative prices to its members who are getting about 78 per cent higher price than the current market prices.

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MahaFPC, a consortium of 303 FPCs in Maharashtra, achieved a turnover of ₹550 crore during the lockdown while working as a procurement agency for Nafed and Food Corporation of India. It procured pigeon pea and chickpea from the farmers through their member companies.

Rural development

According to the report on farmer producer companies published by Azim Premji University, Maharashtra has by far the largest number of producer companies (1940), which is more than the next three States combined. Four States, namely, Maharashtra, Uttar Pradesh, Tamil Nadu and Madhya Pradesh, account for about half the producer companies registered until March 31, 2019.

“You will see more and more FPCs in Maharashtra as the cooperative structure has already collapsed and farmers have realised the benefits of FPCs. These ventures will bring socio-economic development of rural parts and encourage entrepreneurship,” says agriculture expert Nishikant Bhalerao.