Cooperative marketing

Indian Economy glossary

Also called: Marketing cooperatives, Cooperative marketing societies · Topic: Agricultural Marketing, MSP, Buffer Stocks and PDS · NCERT: Class 10, Ch 2 "Sectors of the Indian Economy"; Class 11, Ch 5 "Rural Development"

Meaning

Cooperative marketing means farmers pool their produce and sell it together through their own society. Selling together gives small farmers bargaining power, cuts out middlemen and helps them get fair prices. NCERT counts it as a key government measure to improve agricultural marketing. NCERT gives three reasons for its recent setbacks:

  1. too few farmers are members;
  2. marketing and processing cooperatives are poorly linked;
  3. financial management is inefficient.

Example

Gujarat's milk cooperatives (AMUL, Operation Flood) collect milk from lakhs of small producers and sell it under one brand. NCERT says they transformed "the social and economic landscape of Gujarat". At the national level, NAFED (1958) and state marketing federations procure pulses and oilseeds for the government.

Don't confuse with

  • Farmer producer organisation (FPO): a farmer collective that may be registered as a producer company or as a cooperative. It is promoted under the 10,000 FPO scheme (2020). Cooperative marketing refers specifically to selling through a cooperative society.

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