Telangana SCERT TS 6th Class Social Study Material Pdf 8th Lesson – Trade in Agricultural Produce Part 2 Textbook Questions and Answers.
Trade in Agricultural Produce Part 2 – The Earliest People – TS 6th Class Social 8th Lesson Questions and Answers Telangana
Make a list of the different paddy traders operating in Venkatapuram and the prices they offer for paddy per quintal.
|Name of the farmer||Fixed the rate by|
|Rice Miller Chandulal||AMY||Broker|
|Mallaiah||Rs. 950 per quintal||–||–|
|Chandra Sekhar||–||Rs. 1150 per quintal||–|
|Shanti||–||–||Rs. 1000 per quintal|
1. AMY committee officials noted down the rates bid by different traders for the paddy heaps. They went back to the office and noted down the name of the trader and slip number and informed Chandra Sekhar of the maximum rate bid by the trader for his paddy. He agreed to sell at the rate of Rs. 1150.
2. Mallaiah from Venkatapuram village was able to harvest only 14 quintals of paddy from his one acre of irrigated land. His yield was low as he was not able to put required amount of fertilizer and pesticides. Chandulal fixed the price of paddy at Rs. 950 per quintal on the basis of its dryness and thaalu.
3. Shanti is also another farmer residing in Venkatapuram. Her harvest from her 1.5 acre fields during this season was 14 quintals. A broker of a big rice mill in Nalgonda came to the village to buy paddy and approached the farmers. He saw her paddy and after much bargaining offered her Rs. 1,000 per quintal.
Who purchases paddy in your place ? Collect details about how prices are fixed and what prices are paid by different traders and landlords.
Sri. Gogan Nagabhushanam purchase paddy in our village. Prices are fixed above the M.S.P. (Minimum Support Price) jvhile fixing the prices they take quality of the paddy and demand of that year, into consideration.
Rates paid by different traders and landlords:
Compare the cost of one quintal of rice and one quintal of paddy. Find put the reasons for the difference. (1 quintal = 100 kilograms).
- One quintal of paddy costs around Rs. 1100/-
- Whereas one quintal of rice costs around Rs. 4000/
- Usually we prefer the rice when the paddy gets old (dry) so, it includes weight loss and thaalu.
- All the paddy completely not converts into equal amount of rice as there will be removed husk and broken rice and polish.
- In this way there will be difference in the prices of quintal rice and quintal paddy.
Do you think it is necessary for the government to fix a single price for paddy ?
Many small and medium farmers are increasingly having to borrow money in order to carry on agriculture, especially to purchase seeds, fertilizers, pesticides, irrigation facilities, etc. Since it is. difficult for them to obtain loan from regular banks, they are forced to borrow from moneylenders, traders, millers, etc. Once a farmer borrows from them, he or she has no option but to sell only to them at the price they quote. Paddy traders not only pay lower price but also under weigh in different ways. So it is necessary for the government to fix a single price for paddy.
In what ways do you think the farmers benefit from Self – Help Groups ?
Farmers can get benefits from self help groups. Here is an example about this Shanti is a farmer residing in Venkatapuram. She began to manage her farm after her husband passed away. She is a member of the local Self Help Group (SHG) from which she borrowed Rs. 20,000 for cultivation purposes. Her harvest from her 1.5 acre fields during this season was 14 quintals. She weighed seven quintals and kept them aside for selling. The rest she kept for household consumption.
A broker of a big rice mill in Nalgonda came to the village to buy paddy and approached the farmers. He saw Santhi’s paddy and after much bargaining offered her . Rs.l ,000 per quintal. She got Rs\ 6825. When she weighed the bags it was 7 quintals but . when the broker weighed the next day, he said it was only 6.5 quintal. She insisted on weighing it properly in the presence of other S.H.G. members. This time it turned out to be 7 quintals! The broker took the paddy and promised to pay Shanthi the money in 15 days. Thus Shanti got benefit from Self Help Groups.
Read the para under the title ‘Indebtedness and selling paddy’ of pages 156 (78) and 157 (79) and*comment on it.
Indebtedness and selling paddy
We saw that small and medium farmers have to borrow money for agriculture, especially to purchase seeds, fertilizers, pesticides and irrigation facilities. Since it is difficult for them to get loans from banks, they are forced to borrow from money lenders, traders, millers, .etc. Once a farmer borrows from them, he or she has no option but to sell the produce only to them at the prices they offer. Paddy traders not only pay lower price but also cheat in weighing. Moreover, they take commissions of various kinds. Many of these farmers get delayed payments. Since these traders and landlords lend money in desperate times, farmers have to sell their paddy to them.
It is very expensive to cultivate land for middle class farmers. To meet their expenses they have to approach moneylenders for loans. It is very difficult for them to repay these loans, so they sell their paddy for cheaper rates to these moneylenders. Due to all these they suffer from many losses.
Imagine a situation where there is no AMY near by your village. What challenges will the farmers face in this situation ?
- There is no Agricultural Market Yard nearby our yillage.
- So we may not get minimum support price that government fixed and the additional amounts auction fetch.
- We need to sell our produce to either rice millers or through brokers. They may not be advantageous to us.
- If at all we were to take these produce to a distant Agricultural Market Yard, much 1 of the money needed to be spent on transportation and other miscellaneous expenses.
- In this way we need to face a lot of problems.
I. Conceptual Understandings
What.is an Agriculture Market Yard ?
Agriculture Market Yard (AMY): It is a market run by government in which farmers . can sell their produce and get paid immediately.
AMY committee members daily came at 10 Answer:m and put a slip on the bags indicating the name of the farmer and the amount of paddy in quintals. At about 11 a:m, wholesale traders and rice mill owners came to the paddy heaps and looked at the quality. Then the committee members began their auction from that price. In order to buy paddy from AMY, each trader is required to pay license fee.
When paddy is purchased by them, they are required to pay Rs. 1 for every hundred rupees of’ purchase as commission to the committee. Although farmers are not required to pay anything in practice, they pay Rs. 3.50 per every hundred rupees of trading towards unloading, cleaning and maintenance charges. This is deducted by the trader while making payment to tfie farmer and is paid to the AMY office.
Define Minimum Support Price.
Minimum Support Priee : The government every year announces the minimum support price for various crops like rice, wheat, taking into consideration the cost of inputs. If no trader is willing to buy at a higher price, then the government agencies like the Food Corporation of India buy the produce from the farmer at the minimum supiport price. In this way the government seeks to ensure that farmers get a minimum price for their produce. Of course the farmers are free to sell at a price higher than the – MSP if any trader is willing to buy.
Do you think this practice is appropriate ? How do farmers benefit from this process ?
There are nearly 100 AMYs in TelanganAnswer: Nearly-1/4 of farm products are traded in them. The government agencies like the Food Corporation of India buy the produce from the farmer at the minimum support price. In this way the government seeks to ensure that farmers get a minimum price for their produce. Of course the farmers are free to sell at a price higher than the MSP if any trader is willing to buy.
AMY committee officials noted down the rates bid by different traders for the paddy heaps. They went back to the office and noted down the name of the trader and slip number and informed the maximum rate bid by the trader for his paddy. If a farmer is not interested in selling at the maximum price bid by the trader, he or she can wait for the next day or up to one week. So that the practice is appropriate. The farmers can get benefit from this process.
II. Reading the Text (given), Understanding and Interpretation
Discuss why Mallaiah was selling the paddy at a lower price.
Four months back Mallaiah borrowed Rs. 5,000 from Chandulal for purchasing fertilizers and pesticides. Many small farmers borrowed money from Chandulal on similar terms. Hence they are forced to sell their produce to him at the rate fixed by him. So instead of paying Mallaiah the amount due to him Chandulal also deducted the borrowed amount and the interest.
Amount of money borrowed by Mallaiah = Rs. 5000/-
Interest for 4 months = Rs. 400/-
Total deductions = Rs.5400/-
Amount due for paddy = Rs.13,100
Total amount paid (Rs. 13100 – 5,400) = Rs. 7,700 (All calculations are rounded to rupee)
Farmers like Mallaiah in Venkatapuram village borrow from rice mill owners arid other money lenders or rich landlords and are forced to sell their produce to them at a lower rate. They may also be cheated in weighing and rating of paddy.
What do you think are the advantages and disadvantages for farmers in selling their produce in AMYs ?
The Agriculture Market Yard (AMY) is a market run by government in which farmers can sell their produce and get paid immediately.
- Daily at about 10 Answer:m the AMY committe members come and put a slip on the bags indicating the name of the farmer and amount of paddy in quintals.
- At abolit llAnswer:m wholesale traders and rice mill owners come to the paddy heaps and look at the quality. Then the committee members begin the auction from the first paddy heap of the farmer.
- The committee officials begin their auction from that price.
- In this way the government seeks to ensure that farmers get a minimum price for their produce. Of course the farmers are free to sell at a price higher than the MSP if any trader is willing to buy.
- Farmer has a choice if he is not interested in selling at the maximum price bid by the trader, he or she can wait for the next day upto one week.
- Since the sale is by open auction, farmers have a chance of getting the best price possible.
- Normally there is no delay in payment or charges for on the spot payment as in the village.
- In some AMYs corrupt officials and traders join hands together and give farmers lower prices but this may not happen everywhere.
- Farmers selling in AMY sometimes have to spend Rs. 10 per quintal of agricultural produce towards transport and other charges.
- Several traders and mill agents may cheat farmers in considering the quality of the grains.
- Brokers charge commission from both the farmers and the millers.
- Sometimes they will not get higher rate.
- They have to pay rent for loading and unloading charges.
Compare and contrast the difference between landlord and ricemill owner in the way they procure paddy from Venkatapuram formers.
a) Selling to Rice Miller:
Four months back Mallaiah borrowed Rs.5,000 from Chandulal for purchasing fertiliziers and pesticides. Hence he is forced to sell his produce at the rate fixed by him. Scwnstead of paying Mallaiah the amount due to him Chandulal also deducted the amount borrowed in the interest. Mallaiah borrowed Rs. 5,000. He has to pay interest Rs. 400. Total deduction Rs. 5,400.
Amount due for paddy Rs. 13100 – 5400 = Rs. 7700 (Calculation is rounded).
As per the above information, farmers like Mallaiah in Venkatapuram village borrow from rice mill owners and other money lenders or rich landlords and are forced to sell their produce to them at a lower rate. They may also be cheated weighing and rating of the paddy.
b) Selling paddy to landlords:
Big farmers or landlords of Venkatapuram do lend money to small farmers and purchase paddy for them. They sell their own harvest and all that is procured from other farmers in AMYs, town-based wholesale paddy merchants or in rice mills. Farmers are indebted to landlords in many ways they borrow money, seed, tractors, even water. As such they are bound to sell paddy to the landlords and accept whatever price they pay. However, in this way the farmers are not able to sell their produce at the highest price possible and have to agree to lower prices for their goods.
III. Information Skills
Read the following passage and answer the following questions.
Paddy cultivated in Telangana is mostly sold in the market and farmers keep only a small share for their own use. A considerable amount of paddy produced by small farmers like Shanti is used for their own consumption. Large farmers sell most of their produce in the markets.
Telangana farmers sell nearly three-fourth of their harvests’ within the village and one-fourths in AMY. Big farmers sell their harvest in AMYs. They own vehicles like tractors which reduce their transportation expenses.
Answer the following questions:
1) What is AMY?
Agriculture Market Yard.
2) How is paddy sold in Telangana ?
The paddy is mostly sold in the market and farmers keep only a small share for their own.use.
3) Does Shanti sell her paddy ?
No, she is used for her own consumption.
4) Where do big farmers sell their paddy ?
Big farmers sell their paddy in AMYs.
5) Why do big farmers sell in AMYs ?
Big farmers have own vehicles like tractors which reduce their transportation
V. Mapping Skills
Locate the following in the map of Telangana
a) Warangal Rural
c) Ranga Reddy
VI. Appreciation and Sensitivity
Brokers mediate between farmers and town-based big millers”. Discuss about it.
Brokers mediate between farmers and townbased big millers or wholesale paddy merchants. They produce paddy in small quantities from farmers like Shanti. They neither have any permanent shop nor godown for doing their business. They visit each farmer duripg harvest season, negotiate with them to buy paddy. They collect sufficient amount of paddy and inform the wholesale traders/rice mill owners who then send money and vehicles for transportation. They charge commission from both the farmers and the millers.
A few students can be taken to a near by AMY. After observing what happens there, a role play can be enacted to illustrate how traders bid prices for paddy and other produce.
Teacher should conduct a study tour. Children should enact under guidance of teacher.
Write the script for small play to explain the plight of small farmers in Telangana
Students should take up this job under the guidance of teacher.
TS 6th Class Social 8th Lesson Notes – Trade in Agricultural Produce Part 2
- Agriculture Market Yard (AMY) : It is a market run by government in .which farmers can sell their produce and get paid immediately
- Minimum Support Price : The government every year announces the minimum support price for various crops like rice, wheat, taking into consideration the cost of inputs. In this way the government seek to ensure that the farmers get a minimum price for their produce.
- Food Corporation of India (FCI) : It is the Government Agency. It buys the produce from the farmer at the minimum support price.
- Merchants : The persons whose job is to buy and sell in large amounts by trading with farmer’s and others. They purchase the produce from farmers by way of recovering loans also.
- Commission Agents : They are the brokers who mediate between farmers and town-based big millers or wholesale paddy merchants. They collect sufficient amount of paddy and inform the wholesale traders/ rice mill owners who then send money and vehicles for transportation. They charge commission from both the farmers and the millers.
- Wholesale Traders : The traders who buy in large amounts of produce from the farmers and sell it to shops. They raised the rate considering the quality of the produce.