Value Chain of Indian Agriculture Industry (farm to fork)

The whole value chain can be divided in 5 segments viz. Production, Processing, Market, Supply Chain and Financing. Let's break down each of these segments one by one:

1. Production - This segment majorly comprise of the following stakeholders:

   1. Farmers

   2. Suppliers of Inputs - Seeds, Crop Protection, Fertilizers and Nutrients (manufacturers, dealers, wholesalers, retailers)

   3. Agronomy Experts

   4. Equipment Manufacturers

   5. Farm Labour

   6. Farmer Producer Organisations (FPOs)

2. Processing - This segment relates to processing of agricultural produce into processed food items like paddy into rice, or wheat into flour, or sugarcane into sugar. The major stakeholders in this segment are:

   1. Factors & Mills

   2. Self Help Groups (SHGs)

   3. FMCG Companies having own processing units (like Reliance and ITC)

   4. Co-operative societies

3. Market - This segment relates to the final sale of agricultural produce or processed items to the end users, it majorly comprise of the following stakeholders:

   1. End consumer

   2. Food & beverage sector

   3. Exporters

   4. Government

   5. Traditional Trade & Modern Trade - Distributors, Wholesalers, Institutional Retailers, Small Retailers, Kirana Stores, Ecommerce

4. Supply Chain - This segment relates to the movement of goods across the value chain with the use of vehicles, warehouses, collection points, etc. Major stakeholders in this segment are:

   1. Collection points

   2. Farm level aggregators

   3. Mandi

   4. Logistics - Truckers, agents, etc.

   5. Warehousing

   6. Cold Storage

5. Financial Institutions - This segment relates to 3 aspects:

   1. Credit/Lending - Private and Public Banks and NBFCs lend money to all stakeholers across the value chain from farmers to retailers.

   2. Insurance - Financial institutions give out crop insurance to farmers, transit insurances to supply chain participants, etc.

   3. Commodity hedging
      

Here's a graphical representation of the entire Agriculture value chain in India (from farm to fork):

Now that you have a fair understanding of India's Agriculture value chain, let's look into the Agritech innovations that are disrupting each node of the Agriculture value chain in India today:

1. Production:

   1. Biotechnology for novel farm inputs – seeds & crop protection

   2. Supply chain linkage for inputs & equipment

   3. Smart Greenhouses

   4. IoT, Robots, Drones, Sensors and other smart equipment

   5. Satellite imagery & analytics

   6. Farm automation tools

   7. Farm management software

   8. Cattle management & cattle health monitoring

   9. Alternate farming techniques – hydroponic, vertical farming etc.

   10. Data, Content, Knowledge and Advisory services

   11. Financial Services – credit and insurance

   12. Supply chain linkage for farm output
       

2. Processing:

   1. Use of IoT, ML, Computer vision and AI to conduct:

      1. Grading & Sorting

      2. Quality assessment

   2. Micro-processing units using new-age technology

   3. Food decontamination systems

   4. Data, Content, Knowledge and Advisory services

   5. Supply chain linkage for output

   6. Software to manage and optimize operations (logistics, capacity utilization, procurement, order cycle)
      

3. Market:

   1. Hyperlocal Delivery

   2. B2B and B2C Ecom. platforms along with supply chain linkage

      1. Seafood

      2. Grocery

      3. Dairy

   3. E-distributors

   4. Cold Chain Facility

   5. Order traceability

   6. Aggregators

   7. Mandi automation

   8. Managed farm networks

   9. Food waste management

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This article is a part of the February'24 edition of our Startup Newsletter. Here's the complete publication: