The importance and significance of agri commodities in our national economy and the need for fairness and transparency in this sector is an established fact and not what I want to dwell upon here. I would like to begin with the Food Corporation of India, a Government of India enterprise, entrusted with ensuring the food security of the nation.

In January this year, as wheat and atta (flour) prices soared in the domestic market, the government decided to intervene and decided to sell a pre-decided amount of wheat in the open market so that prices could be controlled. There was a scarcity of wheat in the open market, and over a period of nearly 45 days and six e-auction events, the objective was achieved.

Digital ecosystem

The importance of these e-auction events in the context of national interest is not far to seek. It required speed, precision, domain knowledge, market reach and a superior platform. With rising need to ensure fair prices, fair distribution of agricultural commodities, it is imperative that newer technologies are taken advantage of.

It is certainly a positive that the Indian government is aligned with this and has taken concrete steps in that direction. The Indian Digital Ecosystem for Agriculture, the National Agriculture Market (e-NAM) and the BSE e-Agricultural Markets (BEAM) are some of them which have been aimed at transforming the agricultural sector. Rapid adoption would be key to ensuring that this sector is free of all the disadvantages that come with manual processes. Budget 2023 announced creation of Digital Public Infrastructure for agriculture to develop farmer-centric digital solutions.

Also read: Wheat prices up 2.5% in the past week as FCI procurement loses pace

I believe that shifting to e-auctions are the simplest and the most effective way for the farmers to take advantage of technology. However, in such traditional sectors, this transition is always slow and requires a lot of handholding and persuasion. With the government taking the lead, however, it certainly looks like the outlook is bright. NAFED, Tea Board, Spices Board of India are some of the others that come to mind which have adopted this route to bring about efficiency and transparency in their processes.

Location agnostic

The process of e-auction inherently ensures that farmers get fair prices, and since the whole process is automated, the credentials, capabilities and track record of the entity that conducts the e-auctions assume significant importance. e-auctions being location agnostic, the process ensures that buyers can participate from any location. On the other hand, farmers, who are mostly based out of remote locations, are not at a disadvantage because of their locations. Also, thanks to digital payments, farmers can receive the money directly into their accounts.

As I said earlier, it bodes well that the Union Government is aligned to the idea that e-auctions are the way forward for agricultural commodities. In fact, it was way back in 2015 that the government requested State governments to opt for e-auctions, wherever possible, to procure agricultural commodities. This was followed by the setting up of an Agricultural Produce Market Committee (APMC) by State governments to ensure that farmers are safeguarded from exploitation by large retailers, as well as ensuring the farm-to-retail price spread does not reach excessively high levels.

While the three new farm laws could not be implemented, a host of e-auction and e-trading platforms started consolidating their operations to provide farmers with trading options outside the ambit of regular mandis.

While domain knowledge and farmer sensitivities will continue to be critical, I am hopeful that more and more agricultural commodities will come under the ambit of efficient, convenient and transparent e-auction platforms.

The author is MD, mjunction services limited

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