Analysis of Rice Value Chains - A Study of Bihar and Karnataka States in India

Abstract

The present investigation was aimed for analyzing comparative value chain addition of rice production and marketing in Bihar and Karnataka States, based on primary data having 300 stakeholders selected using random sampling method from two purposively selected districts East Champaran and Davangere of Bihar and Karnataka, respectively, duly categorized into paddy growers, paddy wholesalers, millers, rice wholesalers, rice retailers and consumers. Farmers were the first value adding actors, and earned on an average of the gross return Rs 44,641.8/ha (East Champaran) and Rs 1, 32,117.26/ha (Davangere) by cultivating paddy. They added value of Rs 115.71 per quintal by drying, Rs 86.77 per quintal by selling in markets and Rs 127.27 per quintal by storing (speculation) of produce to sell in future in case of East Champaran district and in case of Davangere district. Paddy wholesalers, the second important key players, and added value of average Rs 65.8 per quintal and Rs 75.67 per quintal in case of both districts under study, respectively. Rice millers were important value adder in rice value chain and added value in three stages purchasing and milling of paddy and selling of rice. The value addition by rice millers estimated about 81.21 per cent and 26.55 per cent, and 60.63 per cent and 32.95 per cent by marketing and milling in East Champaran and Davangere district, respectively. Rice wholesalers were the fourth actor in value chain, value addition by them was about 10.69 per cent and 11.05 per cent in both districts, respectively. The profit earned from rice was Rs 2.38 per kg (East Champaran) and Rs 3.11 per kg (Davangere). Rice retailers, the final value chain actor received less value addition and the profit earned was estimated to be Rs 2.57 per kg and Rs 3.62 per kg in both the districts under study.

Keywords: Rice, Value Chain, Value Addition, Wholesaler, Producer, Consumers

JEL Classification: O13, Q1, Q12, Q13