chicory cooperative
TRANSCRIPT
“Chicory Cooperative”
Presented by:Alpesh Dalwadi-29003
Amit Anand-29005Kamal Pandey-29020
Rijo P-29026Rohan Jain-29029Vivek Kunj-29037
Adulterant/ additive in coffee Agro climatic conditions (Gujarat good, Kheda better) Inulin derived from chicory used in Ice-cream/Chewing
gum/ Pharmacy Stand alone beverage (negligible) Root like carrot
Chicory
Seeds : provided by Company (Brooke Bond / Pioneer Chicory Ind.). There is agreement between Farmer and Co. Free Seeds provides by Company and also price of purchase also fixed during agreement
Sowing : Sowing is done by farmer. It start from the Mid November. Total crop cycle is of 5 ½ to 6 months. Total irrigation required is 6-7 depending up on the weather
Harvesting : Harvesting is totally manual process. It is mainly done by Bharvad community near by town. They do this job free of cost. In turn they get leaves of plant for their cattle
Cutting : The chicory roots are then transported to Near by Chicory cutting factory where chicory first washed and then cuts in to very small peaces. (5mm cube)
Process flow
Sun Drying : Sun drying is carried out after cuts the chicory in to small peaces. Then it is ready for treading in the market or Co takes at their factory for further processing
Roasting : Roasting of chicory is done at factory level. This will improve the flavors of chicory
Grinding : Roasted chicory then grinded to convert in to powder form. Then this powder is treaded in the market. This powder is use to blend it with Coffee to made coffee cheaper
Process flow
Water13%
Fetrilizer25%
Seeds21%
Others16%
Labour25%
Cost of Production at Farm Level
Farmers On Agreement PersonalSeeds 0 1300Fetrilizer 1500 1500Water 800 800Labour 1500 1500Others 1000 1000Total / Bigha 4800 6100Total / Acres 12000 15250
Wet DryYeild / acre 8000 2286Rate Rs. / 20kg 45 220Total 18000 25143Earning/ Acre 6000 9893
Earning per acre at Farm level
Nov-Mar/Apr (140-155 days) Seed imported, broadcasted No pesticide Labour for weeding and harvesting Yield 2.5-3 ton dry roots/acre (25% WoW) Sundried, sliced, roasted, grounded to powder Processing in Gujarat & Blending in South India
CULTIVATION & PROCESSING
EXISTING MARKET CHANNEL
Farmer (29%)
Chicory Traders (40%)
Chicory Processors
(49%)
Wholesaler of chicory Powder
Coffee Manufacturing
Company
Coffee Retailer
Consumer
FACTOR MARKET CONDITION
High volume of chicory production in small area Better price realization if the product could be stored till
October Month Seeds provided by traders or chicory powder
manufacturers under agreement system
PRODUCTION / MARKET RISK
Price fluctuation Coffee production Seed germination problem due to occurrence of Rain
with in two-three day of sowing
WHY COOPERATIVE???
Increase in bargaining power of farmers Easy loan availability In long run economies of scale
COOPERATIVE MARKET CHANNEL
Farmers Cooperativ
e
Chicory Processors
Wholesaler Chicory Powder
Coffee Manufacturing
Company
Coffee Retailer
Consumer
LOCATION SELECTION
Narsanda
PROPOSED CO-OPERATIVE LOCATION
Narsanda Village Chicory Cooperative, Narsanda Establishing the Chicory Cutting plant and sun-drying
in Narsanda. Concentrated Chicory cultivation Approximate Production: approx. 6000 ton dry /annum.
BUSINESS MODEL
Pooling System Payment system : 70% Fixed Pay off. Rest 30%
refund along with Patronage Refund at the end of year. Patronage refund is based on proportionate contribution 15% of surplus will be kept as reserve
CO-OPERATIVE CENTRALITY
Member Centrality: Members derive 45-50 per cent of their income from chicory production
BREAK EVEN FOR CO-OPERATIVE
Fixed Costs Amount in Rs.Office rent 36,000Loan Intrest 784,218Electricity 1,000Godown Rent 90,000Employee wage per annum 200,000Others / Misc. 24,000Total 1,135,218
Labour cost 0.02Transport 0.05Gunny bag 0.20Machine operating cost 0.20Misc 0.03Total 0.50Contribution 2.1800Break-even point(Qty in kgs) 520742.20* Dry Chicory
Variable cost (In Rs. per Kg*)
PATRONAGE REFUND (RS. 0.43 / KG)ParticularsTotal cultivable area in Narsanda village (In Ha.) 2135Total area under chicory cultivation (In Ha.) 1068% of area under cultivation for Chicory 50.00Total prodution of Wet Chicory (@ 8000 Kg/Acre) 21,350,00010% less for washing of Mud 19,215,000Expected pooling from the farmers (80% of Chicory produced) in Kg. 15,372,000Average rate of wet chicory (In Rs./Kg) 2.25Assuming 70% of payment to the farmers (In Rs.) 24,210,900Payment yet to made to farmers (In Rs.) 10,376,100Revenue : Qty. after 1% handling loss (153720 Kgs wet Chicory) 15,218,280Weight of dry chicory (Moisture loss) 4,348,08065% sell during first two months for payment to Farmers @ Rs. 9/k`g 25,436,26835% sell during Sept/Oct. @ Rs. 12/k`g 18,261,936Total Revenue 43,698,204Expenses : Initial Investment for Machinary 2500000
Intrest @ 12% 300,000Working Capital 4,035,150
Interest on Working capital @ 12% (In Rs.) 484,218Other Expenses 488,000Total Expenses 1,272,218Surplus (Revenue - payment to formers- expenses) 7,838,986
Patronage refund (85% of Surplus Rs. Per Kg) (15% as a reserve) 0.43
INCENTIVE TO FARMERS
Better value realization Lower credit period as compare to present situation
(reduction from 30 days to 15 days)
NET VALUE ADDITION
Time
Form
PROBLEMS
Free rider : Capital contribution of new entrants in proportion to amount of product
Control Problem : Addressed by management training
Influence Cost : Long term asset creation like more cutting machine
FUTURE PLANS
Powder Manufacturing Unit : High return in processing.
Collection from other villages : To increase in control over market.
Credit : for Member Centrality
SOURCES OF INFORMATION
Secretary, Dairy cooperative, Narsanda
Farmers of Narsanda, Valasan, Vadtal
Pioneer Chicory Processing Plant,:
1.Lambhval
2. Ravipura
LITERATURE AND WEB LINK
Chicory in India, A.Puspharaj Agriculture market linkages, Vaswani; Talati www.postharvest.com.au www.experiencefestival.com/chicory_-_symbolism_and_popular_references
www.en.wikipedia.org/wiki/Chicory www.google.com
Thank you