- Girish Mahajan* & Kshitj Mandial
- *Extension Specialist (Agricultural Economics), Krishi Vigyan Kendra-Bara-Hamirpur (H.P.)
- DOI: 10.5281/zenodo.18708087
This study
looks at how wheat is managed in the supply chain (SCM) in the Kangra district
of Himachal Pradesh, which is a very important agricultural area in the state.
Kangra is the main district for growing wheat, accounting for around 27% of the
total area and output. This means that the effectiveness of its wheat supply
chain is very important for the food security of the region and the livelihoods
of farmers. The study looks at the socio-economic traits of wheat farmers,
figures out the costs and profits of growing wheat, looks at the costs,
margins, and value added at different points in the supply chain, and finds the
main problems that wheat farmers and marketing middlemen face in the Kangra
Valley. A multistage random sample method was used to choose 80 wheat growers
at random from 10 villages, with five villages each from two randomly
determined development blocks. The research utilized both primary and secondary
data sources. Structured and pre-tested schedules were used to conduct human
interviews to acquire primary data about input use, output costs, and returns. Additionally,
marketing-related data were collected from chosen market intermediaries,
comprising traders, wholesalers, processors, and retailers, with five
respondents selected from each category to evaluate marketing strategies and
limitations. We got secondary data from official government reports and the
Statistical Abstracts of Himachal Pradesh. We used the right statistical
methods, like basic averages, percentages, and ratios, to analyze the data and
figure out applied cost concepts and farm-level economic performance.
The results
revealed that farmers in Kangra farms are small typically holding less than one
hectare. This suggested that a limited capacity for large scale mechanization
and a need for subsistence- focused agricultural strategies. Literacy rates
among farm heads are generally high exceeding 90 per cent with large farms
having slightly higher literacy percentage than small farms implying that
farmers are educated and trained and are likely receptive to technical and
improved production technology. Agriculture remains a primary occupation in the
study area. The land use pattern of the sampled households suggested that wheat
growers in the region were primarily relied on cultivated land which was 81.43
per cent in overall farm situation, with irrigation support ( around 81 per
cent) playing a crucial role in crop production. The cropping structure showed
wheat occupied the major share in the rabi season across all farm categories,
an overall proportion of 39.04 per cent of the gross cropped area. Among kharif
crops, maize emerged as the dominant cereal, covering 25.27 per cent of the
total cropped area, followed by paddy accounting for 12.83 per cent. The
cropping intensity was worked out to be 187.67 per cent for small farmers and
192.34 per cent for large farmers, with an overall value of 190.32 per cent,
indicating multiple cropping practices in the study area. The average family
size was approximately 5.7 to 6.0 members with a high proportion of adults
nearly 65 per cent in overall farm situation. This indicated that a strong
availability of family labour, which is critical for labour intensive hill
agriculture. Nuclear families were more prevalent comprising of 58.75 per cent
of households in the overall farms situation. Investment in farm implements and
tools is a critical factor enhancing agricultural productivity by improving
operational efficiency and reducing labour costs. In this regard, it was found
that an investment in farm machinery and implements in the study area had an
increasing trend and positive correlation with farm size. The small farms
invested on an average of Rs. 2, 76,977.81 per farm, whereas large farms
invested substantially more, averaging Rs. 3, 65,758.23 per farm.
The
economic and profitability assessment of wheat cultivation in the Kangra Valley
showed that the district is the most important part of the state’s wheat
economy. It has 86,493 hectares of land under cultivation and produces 192,804
metric tonnes of wheat, which is a big part of the state’s total production.
The analysis showed that the total cost of cultivation (Cost C3) was ₹71,496.46
per hectare for small holdings and ₹77,510.80 per hectare for large holdings,
with a mean of ₹74,278.09 per hectare. The total cost for Cost A1 was
₹43,854.31 per hectare, and for Cost B2 it was ₹59,740.48 per hectare. The
average yield of wheat on farms was 38.35 quintals per hectare, which brought
in gross returns of ₹115,735.95 per hectare. The highest gross profits were for
large farms (₹121,718.00 per hectare), followed by small farms (₹110,588.61 per
hectare). Farm business income, farm labor income, net farm income, and farm
investment income were all used to measure production efficiency. All of these
were highest among large-scale farmers. The overall output–input ratio was
1.56, and the break-even yield and break-even revenue were 30.95 quintals per
hectare and ₹52,968.26 per hectare, respectively. These results indicate that
larger agricultural holdings attain slightly enhanced efficiency and
profitability in wheat production relative to smaller farms.
The study
aimed to identify the primary wheat supply chains in the mid-hill regions of
the Kangra Valley and to analyze the functions of various market intermediaries
responsible for transporting wheat from producers to end consumers, including
their marketing expenses, profit margins, price differentials, marketing
effectiveness, and the producer’s share of the consumer’s expenditure. Supply
chains were classified based on the creation of form, place, time, and
possession utilities, leading to the identification of three distinct marketing
channels within the study area. Channel II, which goes from producer to primary
wholesaler to secondary wholesaler to retailer to consumer, was the most
popular way to buy and sell wheat, making up 56.86% of all transactions. The
study showed that Channel III (producer → local trader/commission agent → flour
miller → retailer → consumer) had the biggest pricing spread since it had the
most marketing margin (19.84%). Channel I, on the other hand, where producers
sold directly to customers, had the largest producer’s share in the consumer’s
rupee (97.73%) and the lowest in Channel III (62.88%). This shows how having
more middlemen can affect the price. Channel I also had the best marketing
efficiency (42.99%) since there were fewer middlemen, which cut expenses and
helped farmers get better prices. The findings show that having more middlemen
makes marketing more expensive and less profitable for producers, which lowers
their returns and makes the whole channel less efficient.
The amount
of value added to wheat was very different in the several supply chains that
were found. The results showed that the largest value was added at the
processing stage, especially in Channel III, where it reached 23.79%. The least
value was added at the trader level, where it was just 4.90%. So, Channel III,
which includes processing operations, had the most value added overall. In
Channel II, intermediaries added value at different stages, from 5.50% at the
retailer stage to 7.28% at the secondary wholesaler level. Channel III, on the
other hand, showed a greater range, with value addition going from 4.90% at the
trader level to 23.79% at the wheat miller stage before the goods got to stores
and then to customers. These findings indicate that prolonged marketing chains,
encompassing merchants and processors, yield enhanced value addition within the
wheat supply system of the research area. The results show that farmers could
benefit from making direct connections with processors or flour mills. This
would let them take part in value-added activities and get a bigger share of
the value created, which would increase their income and overall returns.
Analysis of
the supply chain in Kangra reveals several bottlenecks: While, cultivators were
mainly constrained by production risks, dependency on middlemen, and limited
bargaining power; intermediaries encountered transportation challenges, price
volatility and infrastructural hurdles. The analysis thus indicated that both
production and marketing hurdles significantly affect productivity and
profitability and efficiency of wheat supply chain. Addressing these
constraints through improved seed distribution, labour management, better
market linkage, and development of infra-structure and processing facilities
could enhance the overall performance of wheat sector.

