How Are Mandis Regulated In India?

Traders in the mandi system Agri traders in the Indian mandi system

Agriculture Produce Market Committee (APMC) has been set up to regulate the purchase of farmers’ produce. There are 7,600 APMC mandis in India as per the 2019 census. However, the number is way less than the mandi trading requirements. There’s now a need to increase the number of APMC mandis to 42,000; so farmers do not have to travel far to sell their produce. 

Now let’s understand the following topics in detail:

  • How does the mandi system operate?
  • How are the prices of farmers’ crops decided in the mandis?
  • What is the role of traders and mandi administration?

How does the mandi system operate?

Farmers, traders, and the mandi administration are the 3 major parties that comprise the mandi system. Mandi is the primary platform for the farmers to sell their crop or produce. The licensed traders buy the produce of the farmer. And the mandi administration plays an integral role in safeguarding the farmers’ rights.

Farmers first come to the mandi and set up bullock carts, tractors or lorries in the mandis. Numbers are allocated to them, following which a slip is generated. The auction for the produce begins. When a trader buys commodities, he first meets the party and then goes to the weighing area to weigh the produce, or the same is weighed in the mandi itself.

For example, there is a slip system in Bhopal Mandi – white, green, and red slips. The white slip keeps a record of how many farmers came to the mandi. Whereas the green and red slips track the details of the crop purchased. After the auction, the green slip is given to the farmer and the red slip is given to the trader from the mandi administration.

How are the prices of farmers’ crops decided in the mandis?

Farmers spread their produce in the mandi. All the traders who are eager to buy those commodities assemble there. After examining the produce, they discuss the quality and the possible rate. Based on the discussion, the auction starts. The highest price quoted is mentioned in the rate mandi contract.

The firm name is written on the green slip which is handed over to the farmer who then takes the produce to that firm. The entire process of the bidding takes place under the supervision of the mandi staff. There is a fixed time for buying and selling agri commodities. It’s the responsibility of the mandi administration to ensure that farmers don’t get exploited in the entire procurement process.

What is the role of traders and mandi administration?

The mandi committee keeps the details regarding which trader bought the produce from which farmer at what price. After the auction, payment is made immediately, but only once the product is weighed. The mandi committee oversees this process. This helps farmers get the best prices for their produce. It’s not necessary that this process would be the same in every mandi of India. The primary function of the mandi system is to help farmers get the right price for their produce.

That was all about mandi committee! But, did you know about this widely used agri trading app for mandi business? Just as the mandi administration ensures that the farmers get the best prices for their produce, the Bijak App enables the mandi agri traders (buyers and suppliers) to trade with reliable counterparties digitally – at the best rates. 

With the Bijak agri trading app, you can connect with 30,000+ verified suppliers and buyers across India in just a few clicks. You can even chat/call and trade with trusted mandi agri traders as per your trading needs. The app also helps you make or receive secure payments 24/7 while keeping a digital record of your transactions.

If you also want to grow your agri trade, it’s time to be a part of India’s largest online agri trader network. You can easily download the Bijak App from Google Play Store for free!

We hope you found this piece of information insightful. If you wish to know more about agri trading or mandis, please tell us in the comments below. And, do follow us on all our social media handles.