Presentation on PROCUREMENT

Page 1

CONTENTS
Topics What is Procurement? Procurement Steps Factors of Procurement Procurement models Slide No. 3 4 5 6-9

Auction
APMC acts Recent News

10-12
13-14 15-16

Page 2

What is Procurement?
Procurement is the acquisition of goods & services i.e. sourcing and purchasing goods & services for business use. Two types of procurement: - Direct Procurement - Indirect Procurement

Page 3

Procurement steps
Information gathering Supplier contact Background review

Consumption, maintenance and disposal

Fulfillment

Negotiation

Renewal

Tender notification
Page 4

Factors Of Procurement
Price Quantity Quality Relationship
Source Time

Page 5

Procurement models
Producer Producer

Middlemen

Cooperatives

Company

Company

Mandi Model

Co-operative Model Page 6

Procurement models
Producer

Company

Contract Farming
Page 7

Supply chain models for commodity procurement

Page 8

Auction
Auction is a process of buying and selling of goods and services by offering them up for bid, taking bids, and then selling the items to highest bidder. Types of auction:1. English auction 2. Dutch auction 3. Sealed first- price auction Auction characterisation:1. Supply auction 2. Demand auction 3. Double auction
Page 9

1. Supply auction:-

S1
S2

Sm
2.Demand auction

V1 C V2 V3
Page 10

3. Double auction:-

V1 V2

C1 C2 Cn Cn
Page 11

Vm

Status of APMC acts in different states

1 States/ UTs where reforms to APMC Act has been done for Direct Marketing; Contract Farming and Markets in Private/Coop Sectors Madhya Pradesh, Himachal Pradesh, Punjab, Sikkim, Nagaland, Andhra Pradesh Rajasthan and Chhattisgarh

States/ UTs where reforms to APMC Act has been done partially

a) Direct Marketing: Haryana, Karnataka, NCT of Delhi, Chandigarh, Maharashtra, U.P. b) Contract Farming: Haryana, Gujarat c) Markets in Private/Coop. Sectors: Karnataka (Only NDDB), Maharashtra
Kerala, Manipur

States/ UTs where there is no APMC Act and hence not requiring reforms

States/ UTs where APMC Act already provides for the reforms
States/UTs where administrative action is initiated for the reforms

Tamil Nadu

Orissa, Assam, Mizoram, Arunachal Pradesh, Tripura, Meghalaya, J&K, Uttaranchal, Goa, West Bengal Bihar and Jharkhand

States/UTs where there is no progress

Page 12

Recommendation for APMC Act

To encourage private investors, smooth licence and registration of traders in mandis. The Committee also stressed on measures for dissemination of market information and promotion of grading, standardisation, packaging and quality certification of agricultural produce. "Investment in marketing infrastructure under Rashtriya Krishi Vikas Yojna (RKVY) be increased to minimum 10-15% of the state's RKVY spending Market fee should be maximum of 2% of the value and commission charges should not exceed 2% for food grains or oilseeds and 4 per cent for fruit and vegetables.

Page 13

Recent News in procurement

Tea board cautious on inferior tea flooding south Indian markets Centre may lift ban on casein exports Haryana cotton ginners call off strike A.P to increase direct procurement from farmers(50lt earlier of 24lt) Areca grower must support cooperatives Amul to augment milk supply in Maharashtra Wheat export: Flour miller hail Govt. decision Govt. aim to procure 35.3mt rice in 2011-12 marketing yr Indias cotton exports may jump by 21% in 2011-12: USDA
Page 14

Recent News in procurement

Wheat procurement during the Rabi marketing season of 201112 has reached to 244 Lakh tonne as on 20.5.2011, surpassing total wheat procurement of 225 lakh tonne during previous Rabi season. Punjab tops the States by making record procurement of 108,47,828 tonne wheat followed by Haryana with 67,84,124 tonne. Gujarat Govt. plans to hike Bt cotton seed procurement price from Rs 280 per kg to about Rs 450 per kg. Government will have to nearly double the allocation for the country's food subsidy bill to Rs 85,359 crore as the FCI requires more money for the procurement of food grains.
http://indiacurrentaffairs.org/wheat-procurement-touches-244-lakh-tonne-punjab-made-recordprocurement/ http://businesstoday.intoday.in/story/food-subsidy-bill-to-rise-as-fci-seeks-more-money-for- Page procurement/1/18381.html

15

Page 16