Impact of online marketing of cotton on price discovery, cost of marketing and involement of middlemen in Karnataka

Online marketing is an innovative method of agricultural marketing which benefits the farmers by eliminating middlemen and also provide better price for their commodities. Recently, a new scheme “Rashtreeya e-Market Services Private Limited (ReMS)” has been introduced as a joint venture company with Government of Karnataka and NCDEX to implement the agricultural marketing policy to bring transparency and improve efficiency in the agricultural marketing system for the benefit of farmers and other market participants. It is a modest system than the existing system of marketing to benefit both the buyer and the seller. This system not only helps the farmer to discover their produce price on scientific basis and get payment online but also breakdown the hold of the middlemen in the marketing system. The present paper attempted to analyse the impact of online marketing of cotton on price discovery, cost of marketing and involvement of middlemen in Agriculture Market Produce Committee (APMC), Hubballi of north Karnataka. The primary data required for the study were collected from 120 farmers, 60 each have sold their cotton produce in online and traditional system of marketing, respectively. The averages and percentages were computed to analyse the data. The results of the study revealed that, the cost of marketing incurred by online farmers was not only lower (Rs. 413 per bale) than their traditional counterparts (Rs. 580 per bale) but also price realized was higher (Rs. 8330 per bale) than their traditional farmers (Rs. 7480 per bale). In view of online marketing, the farmers not only attracted large numbers of traders all over the country but also avoided the involvement of many market intermediaries in the transaction and got their payment online than their traditional counterparts. Based on the finding of the study, it clearly indicated that, the innovative method of marketing not only reduced the cost of marketing and involvement of market intermediaries but also realized the higher price for their produce. To promote online method of marketing and attract more number of farmers, efforts should be made to create awareness among the farmers regarding benefits of the new method of marketing.