Beruflich Dokumente
Kultur Dokumente
Project Report
Problems and Prospects of Sugarcane Marketing in UP
Rural Research Methods
9/25/2014
Executive summary
The aim of this project is to study the problems that Sugarcane farmers in UP face while marketing
their produce and suggest suitable solutions to alleviate them. Sugarcane farmers in UP are facing
huge inefficiencies in the cane procurement system in logistics, supply tickets issuance,
communication gap between sugar mills and farmers. These factors have made farmers to lose
confidence in sugarcane cultivation and farmers are moving to other crops. Also, the area under
Sugarcane cultivation is dwindling.
The major management dilemma identified here is if the cane procurement process is efficient or not.
The problem is to find out ways to weed out the inefficient practices existing in the current system.
Based on secondary research and also an interview with Prof. Amit Agrahari, who was instrumental in
the development of Sugarcane Information System (an IT based solution to shrink the communication
gap) research questions are formulated. Hypothesis, variables and constructs are formulated that
answer all the research questions.
Conclusive research is designed to include two sets of questionnaires to be administered to the
farmers and to the mills. The questionnaire to the farmers are designed to capture demographics,
challenges, barriers, awareness of SIS, perception and impact of SIS. An exploratory research has been
conducted in the sugar mills in order to find if there are any issues from the mills perspective as SIS is
installed in the mills.
The sampling technique that is to be used for the survey would be non-probabilistic judgmental
sampling. The survey would be administered to each farmer personally. The data analysis techniques
& statistical tools have been used for testing each hypothesis.
From our research, we could conclude that the procurement system of sugarcane is functioning well.
However, we could dig out the problems faced by the problems as well as the sugar mills and the
underlying reasons were analyzed in our report.
Table of Contents
Executive summary ...................................................................................................................................... 1
1.
Introduction.......................................................................................................................................... 4
2.
3.
4.
5.
6.
7.
8.
Research design.................................................................................................................................... 6
Exploratory Research ........................................................................................................................ 6
Conclusive Research ......................................................................................................................... 6
9.
10.
11.
12.
Farmers questionnaire.................................................................................................................... 10
Exploratory research questionnaire for sugar mills........................................................................ 12
13.
SIS has reduced the number of trips to the sugar mills >=75%. ......................................... 30
b.
SIS did lead to the increase in the issue of supply tickets .................................................. 31
c.
d.
Demographics ................................................................................................................................. 32
24. Conclusion ............................................................................................................................................ 32
25. References ............................................................................................................................................ 33
26. Appendix .............................................................................................................................................. 33
3
1. Introduction
The state of Uttar Pradesh (UP) is one of the major sugar-producing states in the country. The sugar
industry in the state is largely subsistence oriented and sugarcane is one of the major cash crops. The
Sugar industry of Uttar Pradesh shares a symbiotic relationship amongst the rural masses and thus,
serves as a key nerve center for the development in rural sector.
The area under sugar cultivation in the state amounts to 20.35 lakh out of the total 44.03 lakh ha area
under cultivation in the country. The production of sugarcane amounts to 11.62 million tonnes, which
is actually 39 percent of the total sugarcane production in the country. Over the year from 1961, the
state has experienced a growth of 1.38 percent, 2.84 percent, and 1.43 percent annually in
productivity, sugarcane production and acreage, respectively.
Production and Stock of Sugar in Uttar Pradesh
(2013-2014-Up to April, 2014)
(In Metric Tons)
Region
Stocks of Sugar
(As on 30.04.2014) 2013-14
Season & Earlier Seasons
Stock of Sugar
2308055
1666510
72.2
2338572
1847537
79.0
1884099
1378842
73.2
6530726
4892889
74.9
India
23932122
16645021
69.6
sale and payments of dues has made a big problem so much that sugarcane producers i.e. farmers are
forced to burn the unutilized sugarcane. Ultimately, the biggest sufferers are the small and marginal
farmers. There are issues even in the procurement of sugarcane form the farmers field. The issues
related to improper measurement, extra freight charges, commissioning agents also add to the plight
of farmers.
Approximately 70 to 80% of the sugarcane producing farmers are dissatisfied with the current
circumstances. However, they are continuing the crop as they dont have other alternatives. Some of
the big sugarcane producing farmers have started working as middlemen. They purchase sugarcane
from small producers at the minimum support price and supply it to sugar mills on their own name.
Through its new sugar industry Promotion policy, the government of Uttar Pradesh has decided to
offer several incentives for setting up of new sugar plants. It includes the following modifications to
mention the few: exemption on entry tax on sugar, repayment of administrative charges and
exemption of trade tax on molasses, repayment of transport charges of sugarcane etc. The sole
purpose of all these measure is to attract private investment towards the industry.
5. Management problem
It is necessary to look out for the practices which are making things worse for the whole industry. So,
the problem which needs immediate attention is How to weed out ill practices in sugarcane
procurement process?
7. Research Methodology
The team started by researching our topic The problems and prospects of sugarcane farming. We did
secondary research to explore the entire cane procurement process from harvesting of the farms to
processing in the sugar mills. Research also included an interactive session with Professor Amit
Agrahari who has significant contribution in the development and implementation of Sugarcane
information system (SIS). The management dilemma and the management problem were framed to
cover all aspects of sugarcane marketing. Subsequently, the market research problem and its scope
that would be explored through this project were defined. A set of sub-research questions were
formulated to clearly analyse the market research problem.
The research designs used are exploratory research and descriptive research. Exploratory research was
conducted through primary as well as secondary sources. The team also defined hypothesis for the sub
research questions which would be analysed using data obtained from the survey. The team
formulated a checklist from the list of hypothesis, to design a questionnaire for conducting survey.
8. Research design
Exploratory Research
Secondary Data analysis: Exploratory research primarily included Secondary data analysis. It was
conducted to gain first-hand information about how farmers dispose of their sugarcane produce. The
entire cane procurement process was studied to better understand the problems faced by sugarcane
farmers. The different aspects that were explored and studied under secondary analysis have been
elaborated below. Using these, problem identification for the research was initiated and formulated.
Conclusive Research
Primary data analysis will be followed with a conclusive research on the formulated hypothesis. The
survey data will be statistically analysed to test the test the research variables. Important variables for
the Conclusive research
Target population
Sampling frame
Sampling technique
6
9. Sampling Design
Sampling Unit: Village households or farmer groups in the sugarcane producing villages
Sample Size
Necessary Sample Size = ( / )2
E = maximum difference between the sample mean and the population mean = 1
Confidence Level: At 95% confidence level Z value = 1.96
Standard Deviation: Standard deviation assumed to be low due to the nature of parameters Education,
Farm size, etc.
Sample Size = [(1.96 5.76)/1]2 = 127.4 ~ 128
Required Sample Size: 128 sugarcane farmers.
H0: Greater than or equal to 20% of the farmers sell their produce to cooperatives, third party or other
farmers
H1: Less than 20% of the farmers sell their produce to cooperatives, third party or other farmers
Variable
1) Ways of marketing Sugarcane (Nominal)
Construct: Ways of marketing sugarcane/Means of selling sugarcane
2.
What factors (land size, education, experience, source of investment) influence the means of
selling (sugar mill, khandsari, cooperatives, etc.) for a farmer?
H0: Large scale farmer (farm size >= 4.5 acres) do not prefer to sell most of his produce to the sugar
mills
H1: Large scale farmer (farm size >= 4.5 acres) prefers to sell most of his produce to the sugar mills
H0: Level of education does not affect the means in which the farmers sell their produce
H1: Level of education affects the means in which the farmers sell their produce
H0: Experienced farmers (farmers who have been growing sugar cane >= 5 years) do not prefer to sell
their produce to the sugar mills
H1: Experienced farmers (farmers who have been growing sugar cane >= 5 years) prefer to sell their
produce to the sugar mills
H0: Farmers are not obligated to sell their produce to the cooperatives if they have taken a loan from
them
H1: Farmers are obligated to sell their produce to the cooperatives if they have taken a loan from them
Variables
2) Farm Size (Ratio)
3) Education level (Ordinal)
4) No. of years in Sugarcane Farming/Experience (Ratio)
5) Amount of produce (Ratio)
6) Loan status(Yes/No) (Nominal)
7) Loan Amount (Ratio)
Construct: Factors of influence
3.
What is the awareness level of the farmers about usage of SIS and barriers that prevent them
from using SIS?
H0: All farmers in the village are not aware of SIS
H1: All farmers in the village are aware of SIS
H0: Less than 90% of farmers access SIS through mobile phones
H1: Greater than or equal to 90% of farmers access SIS through mobiles
Variables
8) SIS awareness (Nominal)
9) Means through which SIS is accessed(Website, IVRS, SMS) (Nominal)
10) Purposes for which SIS is used (Nominal)
Construct: Awareness
4.
5.
What is the impact of the SIS on the entire cane procurement process?
H0: SIS has not improved the realisation of better prices and transparency
H1: SIS has improved the realisation of better prices and transparency
H0: SIS has reduced the number of trips of the farmer to the sugar mills by < 75%
H1: SIS has reduced the number of trips of the farmer to the sugar mills by >= 75%
(A total of Rs. 522 crores were spent only on travel by 29 lakh farmers)
H0: SIS did not lead to the increase in the issue of supply tickets
H1: SIS did lead to the increase in the issue of supply tickets
Variables
20) No. of trips made by farmer in a year (Before and after SIS) (Ratio)
21) Supply tickets issued (Before and after SIS) (Ratio)
22) Timing of supply tickets issuance (Nominal)
23) On-time payments (Interval)
24) Transparency in Cane Weighing (Interval)
25) Pricing for Sugarcane (Interval)
26) Productivity (Perception)
27) Profitability (Perception)
28) Total amount of sugarcane supplied to factories (Ratio)
Construct: Impact
If Yes, Proceed
14. Do you have any feedback or suggestions or improvements that you wish to see in SIS that
(according to you) are lacking in this system? (RQ6)
15. How do you access SIS? (RQ3, Variable 9)
Mobile (SMS)
Website
Interactive Voice Response System (IVRS)
I do not use SIS
16. What uses of SIS are you aware of? (RQ3, Variable 10)
Supply ticket information
Queries
Advisory services
Others
17. For what purposes do you SIS? (RQ3, Variable 10)
Supply ticket information
Queries
Advisory services
Others
18. Rate the following Statements (RQ4, Variables 11-19)
(Strongly Agree 5, Strongly disagree 1)
Parameters
Strongly
Agree
19.
Agree
Neutral Disagree
Strongly
Disagree
Dont
Know
20.
21.
22.
23.
How many trips do you take for information access before &after SIS? (RQ5, Variable 20)
o Before ()
o After ()
Accessibility to supply tickets (RQ5, Variable 21)
o Before SIS ()
o After SIS ()
What is the arrival time of supply tickets? (RQ5, Variable 22)
o Before planting of crop
o After planting. Exactly at what stage?
Rate your satisfaction level on the following before and after SIS (RQ5, Variable 23 to 27)
(Least Satisfied 1, Very Satisfied 5)
o Pricing for Sugarcane
o On-time payments
o Transparency in cane weighing
o Productivity
o Profitability
Demographics
Age:
Gender:
Household size:
Variables
2,3,4,5,6,7
20 to 27
11 to 19
11 to 19
Research Question
RQ2
RQ5
RQ4
RQ4
11 to 19
RQ4
12
(Standard Deviation)
Mode
Chi square Test
Text Analytics
Frequency distribution
1,8,9
RQ1, RQ3
1,8
RQ1, RQ3
Open
Ended RQ6
Questions
1,8,9,10,
RQ3
Demographics
Discriminant Analysis
Discriminant Analysis will be used to find out the most important factors that determine the ways in
which the farmers market their produce. The ways (Sugar mills, Khandsari, third parties) would be used
as the non-metric dependent variable and the factors would be used as metric independent variables.
Paired T-Test
Dependence T-tests will be used if the means between two groups of ratings (before and after SIS
implementation) are significantly different.
Descriptive Statistics
Mean and median scores will be used to find out the average perception level of the farmers in the
village about SIS for each variable.
Factor Analysis
Factor analysis will be performed to find if the variables could be grouped into some factors /
constructs and also to find out the importance of each variable.
Dispersion Measures
Range and Standard deviation will be used to find the variability of the responses for a particular
variable. This is mainly used to find the presence of any outliers.
Text Analytics
Text analytics tools will be used to find out the most used word in the respondents answers thereby
finding their frequencies of occurrences. This would be used to analyze the open ended questions.
The questionnaire was prepared with a mixture of open ended questions, alternative choice and rating
the parameters based on their perception. The sugar mills visited for primary research:
Water Canal
1958
School
1970
Diesel Engine
1988
First Tractor
1990
Television
2004
Tubewell
2006
Mobile Phones
2007
Electricity
Institutional Map
14
Resource Map
15
Primary School
1965
Water Canal
1970
Electricity supply
1975
Hospital
1980
Gas Connection
1987
Television
2000
2001
Computer
2003
Mobile Phones
Institutional Map
16
Resource Map
17
Mohanpur, Roza
Historical Timeline
1930
Water Canal
1960
Primary School
1980
Warehouse
1995
2000
2001
Gas connection
2003
Mobile Phones
Institutional Map
18
Resource Map
19
Dakiya Tiwari
Till High School
Available
Bharatpur
Till Middle School
(8th Std)
Not available
Private clinic is
available & medical
store not available
Positive with hand
pumps & wells
80%
None
Bank of Baroda
None
None
Government service
Government service
& private jobs
Wheat (80%)
15 cattle; 150
Buffalos, 25 goat &
10 lakh fisheries
Health facilities
Water availability
Households with
toilet facilities
Bank facilities
NGOs/informal
organizations
Educational level
Other Livelihood
sources
Major crops
cultivated
Livestock
Sugarcane (90%)
Mohanpur
Till High School
50 cattle; 50 buffalo
& 15 sheep
Caste
Mobile connectivity
Problems
differentiation, road & credit facility
connectivity
From the above table, it can be concluded that Dakiya Tiwari village has better education
facilities than the other two villages. The educational institutes are located at a distance from the
places making it difficult for them to pursue their higher education. It is also observed that not
all households have toilet facilities. This tells us that the social status of the villages is still low.
Lack of proper sanitation is causing health problems. Bharatpur doesnt have health facilities as
well and the road connectivity to this place is poor. The villagers are facing issues travelling to
the towns, especially the women. It has also been observed that women are mostly pertained to
household activities and seed sowing activities only. People in Dakiya Tiwari are sending their
children to towns for higher education, whereas the other villages are not willing to send their
20
offspring to towns. Instead they want educational institutions to be established near to their
place.
Developmental activities that the villages are looking for
Dakiya Tiwari
Education institutes till
Degree
Better hospitals
Electricity
Bus stop
Medical camps
Bharatpur
High school
Mohanpur
Electricity
Medical store
Health centres
Local markets
Mobile tower
Industries for jobs
Canals
College
21
Final product capacity of the mill is estimated as 85% of total sugarcane production as some farmers
opt to grow vegetables for crop rotation after two ratoons. The farmers need to register themselves
with the mills by providing their details to them. Based on their production capacity, supply tickets for
each farmer is estimated and the same information is communicated to the farmers. The farmers are
given 15 days time to verify their details. After the calendar has been finalized, the farmers start their
cultivation. Sugar mills provide complete support to the farmers with respect to any information or
support they require regarding farming. The supply tickets are sent to the farmers 4 days before the
weighing process starts. The weighing process is highly transparent.
Poor cane yield due to cropping of mid maturity and late maturity varieties
Lower sugar recovery
Delayed payments to farmers
Dalmia chini mills in Nigohi, Shahjahanpur contributes to 1% of total UP sugar production. Production
is totally on recovery basis. Early varieties of sugarcane are procured predominantly. Sugar mills runs
at a capacity of 80% throughout the season. Issuance of supply tickets based on variety of crop.
Functional facts of the mill
About 12,000 labour required per day during sugarcane harvesting season
Sugarcane procurement within the radius of 15 km
Power production is 90 MW per annum
The payment made to the farmers in the previous year was INR 250 crores, which
averages to INR 80,000 per family. This value is on an average 40% more compared to
other crops
Byproducts of Sugarcane and Marketing
Sugarcane
Byproducts
Electricity
Ethanol
Bagasse
Molasses
Press Mud
CO2
100% electricity derived through cogeneration of electricity, surplus is sold to power grid
Bagasse is sold to paper mills and fertilizer companies
CO2 is sold to the companies for coolant production and cold chains
SIS implementation
Nigohi mills has implemented all the services of SIS. They also monitor the process regularly.
Additional to the services of SIS, they installed a camera at the weighing area which can be accessed
by the farmers online. This way, they can get to know the traffic and plan their travel accordingly.
However, this service is used by not many farmers.
Consists of master data which includes demographic, crop specific, historic information
Calendar planning based on pre calendar
SMS activity based
Query management service
IVRS online voice query management on a toll free number
Enquiry on supply ticket issuance, status
Locating the area under cultivation of sugarcane for an individual farmer
Information on government schemes
Impact of SIS
Positive impact on recovery
Timely intent
Consultancy on soil and crop health, fertilizer inputs, cane quality
are lacking in funds to implement SIS. Each supply ticket has a fortnight validity. Priority of supply
ticket issuance is based on the variety of crop grown. They give preference to the small farmers and try
to collect their produce in the initial days of the crushing.
Services provided to the farmers
50% transportation subsidy on the seed distribution
Establishment of procurement centres for far off villages as their radius is large
Procurement of the late variety of produce as per the government rule
Fertilizer, crop health services at the procurement centres
the mills. The private mills claim that this is one of the reasons that the industry is becoming weak.
Many of the farmers are still producing the plant varieties which are not acceptable in the market. The
mills are obligated to procure these varieties in the interest of the farmers. The mills are not able to
realize the cost of sugar production of these varieties. Many of the mills are cutting down their costs
by generating the electricity that is required by the plant. Government takes into consideration only
the cost of production which is around INR 54 for the cooperative mills and INR 34 for the private
mills. Hence, the prices are set considering these costs. The detailed cost analysis is attached to the
end of the report. The cooperative mills are established more than 50 years back and the machinery is
not properly updated. This is resulting in the increase in cost and decrease in the sugar quantity
production. Hence, the cooperative mills are not able to cover up their losses. The lack of
synchronization between the sugarcane and sugar prices is also creating issues for the mills.
An interesting aspect that was discovered during our research was that the excess in production of the
sugarcane is also creating issues in the market. The mills are obligated to procure and operate for
more duration. After the stipulated time, the sugar content decreases. However, mills are obligated to
pay the same price for the cane procured during this time as well.
All these issues are the major reasons for the delay in payment to the farmers. The delay varies from 3
months to 1 year as well. Farmers are taking loans from banks for their survival as they are not being
paid on time. This is further adding up to their problems. Keeping in view of the farmers problems,
Supreme Court passed a judgment to pay the dues immediately to the farmers. In case of delay in
payments exceeding 14 days, the mills are penalized with 15% interest.
25
Problems
For past 3 years the price rise in FRP was on an average Rs. 34 per quintal of sugarcane
Productivity is very low due to rejected varieties of sugarcane being cultivated which
constitutes about 17% of the total sugarcane production in the state
Average yield of sugarcane in Uttar Pradesh is 60 tonnes per hectare whereas the average yield
in Maharashtra is at 80 tonnes per hectare
In the last two years the area under sugarcane cultivation has reduced by approximately 8 to 9
percent
Current payment due to the farmers stand soaring high at INR 60 billion
Cost of sugarcane cultivation, sugar production cost also rises marginally leading to a shift
demand patterns for UP sugar as the cost is lower at Maharastra, Tamil Nadu
Does not support the cane development process
Recommendations
Govt. should invest more on R&D to develop a sugarcane variety which suits the agro climatic
conditions of Uttar Pradesh
Eliminate the rejected varieties of sugarcane and promote high yielding varieties
Intercropping of crops which have stable prices in the market irrespective of demand supply
fluctuations
119
50
12
Khandsari/
Kohlu
Local Market
Others
0
Sugar Mills
The Chi Square test is performed to check if the sample proportions are same as that of the population.
Lower level of significance indicates that the null hypothesis is rejected and the results are as below.
26
Results
More than 70% of farmers sell their produce to sugar mills
Less than 10% of farmers set up/ Sell to their own Kohlus (Khandsaris)
Less than 20% of farmers sell their produce to third parties and other big farmers
df1
df2
Sig.
Size
.965
.531
29
.086
Education
.985
.216
29
.807
Experience
.987
.189
29
.829
Loan
.966
.515
29
.603
The table shows that none of the factors except farm size are significant. Some farmers who have a
very small portion of their land under sugarcane cultivation tend to sell their produce to the khandsaris
and for other parties or big farmers. Some very large scale farmers who have more than 100 acres also
set up their own khandsari units to produce Jaggery from some of their produce. But they sell
maximum percentage of their produce to the sugar mills only.
Pooled Within-Groups Matrices
Size
Size
Education
Experience
Loan
1.000
.454
.816
-.597
Education
.454
1.000
.487
-.232
Experience
.816
.487
1.000
-.306
-.597
-.232
-.306
1.000
Correlation
Loan
Variables Size and Experience are highly correlated. This is because farmers who are involved in
Sugarcane farming as a family occupation for many generations tend to have much experience and also
they have huge farm land which have been passes on from their elder generation.
Results
Farm size is the only factor that influences the means of selling
Not all small farmers set up khandsari units, but only the farmers who do not get supply tickets
sell their produce through other means
27
Awareness of SIS
All the farmers in Nigohi and Rosa are aware of SIS. Tilhar mill has not implemented SIS and hence the
farmers do not know about SIS. Awareness is dependent on the mills that the farmers are registered
with.
Farmers in Nigohi access SIS through Mobiles mostly. Nigohi also has a toll free number for IVRS access.
Some farmers also access through the website.
IVRS
Website
Do not use
SIS
In all the villages, 100% of the farmers have access to mobile phones. At least one person in the
household owned a mobile. All the farmers get supply tickets information about SIS and few farmers
also use advisory services. Also, farmers use SIS mainly to get supply tickets information. However,
farmers in Nigohi also use advisory services effectively.
Queries
Advisory
Services
Payment Info
Results
All farmers have access to mobile phones, even though connectivity is an issue
Farmers registered with private mills that have implemented SIS are well aware of SIS
Std. Deviation
3.83
.874
28
Analysis N
30
Tcost
4.30
.915
30
Query
2.97
.890
30
Accuracy
4.07
.944
30
Security
4.23
.817
30
Area
2.37
1.189
30
Advisory
4.00
.743
30
Productivity
3.60
.675
30
Profitability
3.23
1.135
30
Results
The farmers are well satisfied with the information availability parameter. They mentioned that
the fact of getting information at their convenience is saving their time and reducing their
tension quotient.
Advisory services have been handled effectively by the mills but farmers do not use the query
service much.
The information that was provided to the farmers turned out to be accurate and the farmers
are happy about the same. The security and privacy of information of farmers have been well
handled by the system. The farmers feel that their information is being maintained with
security.
Farmers travel to mills for two reasons. One to seek information and the other to harvest their
produce. The number of trips for harvesting produce depends on their yield. However, due to
the messaging services provided by SIS regarding the traffic, waiting time has been reduced for
the farmers. On the other hand, in spite of receiving messages regarding supply ticket, few
farmers travel to mill for hard copy. It would take time for them to adapt to this method.
The major problem faced by the farmers is the payments delay issue. This has a major impact
on their confidence to increase the area under cultivation. In spite of SIS and mills support, this
confidence level is not high. Due to the time being saved and appropriate messages, farmers
perceive that their production & profitability has been positively impacted by SIS.
Factor Analysis is performed to reduce the variables into certain factors. The factors identified are
Info
.293
-.430
-.558
.126
Tcost
.265
.407
.810
.146
Query
.420
.749
-.170
-.346
Accuracy
.829
.005
.209
-.019
Security
.790
.110
-.130
.241
Area
.045
-.102
.072
-.661
Advisory
.276
-.707
.104
-.297
-.435
.791
.092
.157
Productivity
29
Profitability
.014
.089
-.876
.033
Both the mills have a higher rating on Factor 1 showing that the information sent by the system is
accurate and secure. The system as such does not have any loopholes. Nigohi Mill has a higher rating
on Factor 2 whereas Roza has a very low rating. Relationship management with the farmers is high in
Nigohi. The mill provides information about irrigation techniques, fertilizer and pesticide techniques.
Farmers registered with both the mills have the perception that SIS has reduced their transportation
cost significantly and hence they are more profitable.
Results
Impact of SIS
From our research, we discovered that implementation of SIS had no role in the realization of prices as
the prices were set by the government. Hence, that hypothesis has been nullified.
a. SIS has reduced the number of trips to the sugar mills >=75%.
Paired t test has been used for testing the hypotheses on impact. Before implementing SIS, the supply
tickets were distributed manually. This would obviously not be an effective way of distribution and
delays would creep in. Farmers travelled to the mills in case of delay or loss of the supply tickets on the
way. This increased the number of trips to the mills for the farmers. However, post SIS, the farmer
rarely travelled for supply tickets as the message was being sent on time by the mills. The difference in
the mean values shows the impact of SIS on the number of trips. The t-value = 23.688 >> 2.3
(significance 95%). This implies that the test significance is high and can conclude that SIS has reduced
the number of trips to the sugar mills >=75%.
Paired Samples Statistics
Mean
Pair 1
before
after
Std. Deviation
4.4125
88
1.00245
.11208
.8875
88
.79546
.08893
Mean
Std.
Std. Error
Deviation
Mean
30
Upper
df
Sig. (2-tailed)
Mean
Std.
Std. Error
Deviation
Mean
Upper
df
Sig. (2-tailed)
Pair 1 befo
re -
3.52500
1.33098
.14881
3.22880
3.82120
23.688
87
.000
after
Std. Deviation
before
3.6000
88
.49299
.05512
after
4.4750
88
.50253
.05618
- after .87500
.68205
Difference
Std. Error
Mean
Lower
.07626
Sig. (2-
Upper
-1.02678
-.72322
df
-11.475
tailed)
87
.000
The negative t-value implies that the sample mean of ratings before the implementation is less than
the mean of ratings after the implementation. This implies that the perception of the farmers is
positive that the productivity has been effected by SIS. The p-value is low, hence it can be concluded
that the significance is high.
d. Paired t-test for Profitability
Paired Samples Statistics
Mean
Pair 1
Std. Deviation
before
2.9375
88
.75211
.08409
after
4.5000
88
.50315
.05625
31
Std. Error
Mean
Pair 1
before - after
Std. Deviation
-1.56250
Mean
.88366
Lower
.09880
Upper
-1.75915
-1.36585
df
-15.815
Sig. (2-tailed)
87
.000
Results
SIS has created a major impact on farmers perception
The implementation of SIS has not been 100% in spite of the mandatory rule. The success of SIS
mostly depends on the features that are used to streamline the process.
Demographics
Age
Household Size
50
100
40
80
30
60
20
40
10
20
0
<25
26-40
41-60
>61
<6
6-10
>10
Most farmers live as a joint family and hence the average house hold size is around 6 to 10. Most of the
farmers were middle aged around 26-60.
24. Conclusion
The major issue with the farmers is delay of payments which in turn reduces the confidence to
cultivate Sugarcane. SIS has brought about significant impact in the procurement process by reducing
the information gap between the farmers and the Sugar mills. But the implementation of SIS totally
depends on the mills and hence the profitability, development and status of the farmers totally
depends on the mills that they supply to.
Establishing procurement centers at the major villages would reduce the traffic and waiting time for
the farmers in villages near the mills. As many farmers informed that they are facing problems
transporting the produce due to the poor road connectivity. Apart from this, the government and the
sugar mills must come on to a common platform to educate the sugarcane farmers regarding the
benefits of drip irrigation.
32
25. References
1. http://www.indiansugar.com/
2. Paper on Economics of Farming Systems in Uttar Pradesh by S.P. Singh*, B. Gangwar
andM.P. Singh
3. Sugarcane Information System Case study by Governance Knowledge Centre
4. http://www.upcane.org/sis/en/index.asp
5. http://www.kisaan.net/
26. Appendix
SI.No Particulars
A
1
Cane Cost
Cane Cost
Purchase tax
Cane Commission
Cane Marketing
5
6
7
B
1
2
3
4
Cane
Development
Transportation &
Loading Exp.
Cane Outcentre
exp.
TOTAL (A)
Other Expenses
Manufacturing
exp.
Chemicals
Variation
23,129.59
273.82
2,913.07
7,417.90
273.98
3,616.42
(703.35)
169.56
2.01
21.36
13.87
0.51
6.76
14.60
425.67
5.04
53.61
34.41
1.27
16.77
36.84
7.62
0.09
0.96
7.94
0.29
3.87
(2.91)
271.20
3.21
34.16
2.07
0.08
1.01
33.15
635.26
7.52
80.01
134.49
4.97
65.57
14.44
58.39
0.69
7.35
8.40
0.31
4.10
3.25
24,697.29 292.38
3,110.52
7,619.08
281.41
3,714.50
(603.98)
211.07
2.50
26.58
53.37
1.97
26.02
0.56
375.52
4.45
47.30
144.08
5.32
70.24
(22.94)
83.36
0.99
10.50
7.85
0.29
3.83
6.67
103.79
1.23
13.07
78.29
2.89
38.17
(25.10)
29.77
0.35
3.75
68.25
2.52
33.27
(29.52)
3.03
0.11
1.48
(1.48)
Sugar Handling
Power & Fuel
Packaging Cost
56.48
0.67
7.11
5.09
0.19
2.48
4.63
17.53
0.21
2.21
33
1.92
0.07
0.94
1.27
Ash Handling
D
E
Medical Expenses
Security
Repair &
Maintenance - P &
M
Repair &
Maintenance Building
Subscription to
Federation &
Other
Govt. Guarantee
fees
Insurance
Travel
Vehicle expense
Advertisement
P
Q
R
S
T
U
V
W
X
Y
11.25
119.70
1,135.97
41.96
553.82
(434.12)
69.41
0.82
8.74
4.41
0.16
2.15
6.59
7.16
0.08
0.90
18.78
0.69
9.16
(8.26)
48.09
0.57
6.06
7.71
0.28
3.76
2.30
372.71
4.41
46.94
217.73
8.04
106.15
(59.21)
49.57
0.59
6.24
27.43
1.01
13.37
(7.13)
9.55
0.11
1.20
79.00
2.92
38.51
(37.31)
29.40
1.09
14.33
(14.33)
9.02
0.11
1.14
10.47
0.39
5.10
(3.96)
11.71
0.14
1.48
4.21
0.16
2.05
(0.57)
57.63
0.68
7.26
6.12
0.23
2.98
4.28
0.03
0.37
6.06
0.22
2.95
(2.58)
0.13
1.42
4.21
0.16
2.05
(0.63)
1.67
17.72
13.50
0.50
6.58
11.14
8.69
92.41
29.70
1.10
14.48
77.93
38.45
409.02
1,878.29
69.37
915.72
(506.70)
330.82
3,519.53
9,497.36
350.79
4,630.22
(1,110.69)
17.41
185.22
356.60
13.17
173.85
11.37
5.60
59.61
72.44
2.68
35.32
24.29
0.12
1.28
7.76
0.29
3.78
(2.50)
23.13
246.11
436.80
16.13
212.95
33.16
307.69
3,273.42
9,060.56
334.66
4,417.27
(1,143.85)
10.60
0.13
1.33
1.63
0.06
0.79
0.54
27.56
0.33
3.47
10.42
0.38
5.08
(1.61)
Staff Welfare
950.38
2.93
Rent, Rates &
Taxes
11.30
Other
Administrative exp. 140.66
Depreciation
733.72
TOTAL (B to R)
3,247.56
TOTAL (A + S)
27,944.84
Less: Realisation of By-Products
Molasses
1,470.65
Bagasse
473.29
Pressmud
10.13
TOTAL (U to W)
1,954.08
GRAND TOTAL (TX)
25,990.76
ADD: Interest & Other expenses
Sugar Loading
Commission on
Sugar Sale
34
3
4
5
Interest - Working
Capital
Interest - Term
Loan
Total of (1 to 4)
944.70
11.18
118.98
297.52
10.99
145.05
(26.07)
683.32
8.09
86.06
1,586.16
58.59
773.30
(687.24)
1,666.18
19.73
209.84
1,895.73
70.02
924.22
(714.38)
27,656.94
327.42
3,483.26
10,956.29 404.68
5,341.49
(1,858.23)
1.53
35