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November 25, 2007

Inputs to farmers via SMS

Businessworld has an article on a SMS-based service for farmers.
UK-based financial information and news provider Reuters Plc and Mumbai-based Multi Commodities Exchange of India (MCX), who are already empowering farmers by providing real-time agri-related information, believe food production could be revolutionised by integrating rather than sidelining middlemen. “The middleman is a key player and need not be wiped out,” says Anjani Sinha, director of MCX, which is setting up electronic mandis (wholesale markets) across the country to help farmers garner information. “He could help the farmer get produce to mandis that offer better prices.” For now, Reuters is helping farmers in Maharashtra do that through its SMS-based service, Reuters Market Light, which provides information on cropping patterns, mandi prices, weather updates and other agri-related information. In the process, it is indirectly helping sustain the middleman by ensuring that farmers go to those offering the most competitive prices.

Why SMS? “Mobile subscriptions are growing in rural regions,” says Amit Mehra, managing director of Reuters Market Light. “We can use this as an opportunity to provide information to farmers.” The service already has 4,500 subscribers in Maharashtra, with farmers receiving data in Hindi, Marathi or English. Mehra says farmers are keen as they can leverage the service to bargain with middlemen. Reuters has information coming in from 25 mandis across Maharashtra (the state has 293 in all), secured from the Maharashtra State Agricultural Marketing Board.

In 2006, an Indian Market Research Bureau study of 1,500 Maharashtra farmers who were given timely market information found that price realisation increased by 30 per cent when compared with farming without such information. Not surprisingly, the study also found that farmers were willing to pay for information. Subscribers to Reuters Market Light, for instance, pay Rs 60 per month per crop for text messages to be sent to them every day on weather and crop prices.
Arun Natarajan is the Founder & CEO of Venture Intelligence, the leading provider of information and networking services to the private equity and venture capital ecosystem in India. View free samples of Venture Intelligence newsletters and reports.