Farmer Producer Company

Farmer Producer Company

Farmer Producer Company- this is the company which is made by primary producer to their own benefit and run by them too. Primary Producers- farmer, milk producer, fishermen, etc.This is also run by primary producers.Company is a legal form which share benefit/income/profits among the members.

Need of the farmer producer company- the requirements of the primary producers are the same. So at the time of purchase of input they can purchase a big amount of inputs, this reduce the cost of the input to them. Because this is group of small farmers who collect their produce and may sale at rational rate. By collecting the amount they can do something bigger which increase their income.

How to make a farmer Producer company- first farmers should make group village wise, farmers of  many nearby villages may come together to make a producer company. In this more than 33% of the member should be marginal (farmers which have less 1 hectare Land) and small farmers in farmer Producers Company. (Have land 1-2 hectares they should be like minded and should have zeal to earn more with their produce by removing middlemen.Take 2-3 meeting with them and told the benefit of the farmer producer company. It will take 3-6 month. Now collect the general information of the farmers which are interested and want to be a member of company.

Selection of Board of Director – from these farmers select the board of Director these persons should be some educated and able to handle the company. These numbers may be 5-15 persons. One woman member should be in board of Directors.

Selection of Chairman and secretary- from the selected Board of Director choose the Chairman and secretary for the company. These persons are signatory authority for financial and other work in the company with the board of director.

Member of the company- any primary producer can be the member of the company. Only one person from the family can be the member in one company. The number of the member should be as more as possible. Initially it may 200-500 members. But the more the member will be best. Minimum limit is 10member and there is not limit of maximum member.

  • Registration of the company – contact a chartered Accountant (C.A.) in your district. CA will register the company in office of the registrar of company.
  • Document- Provide the complete list of the producers who want to be the member of the company.
  • Provide name and other information for example- pan card, adhar number of the board of directors.
  • Provide Fees for the registration and charges of CA. The fees will be approx- 40 thousand.
  • Initially the form making a company there is a need 1 lakh for making a company this is called paid up capital.
  • Collection of the money – collect some amount from the company member to run and register company.
  • Within two-three month the company will register and now the company member can start the business.
  • Business Plan – Now make a plan of business what they want to do in what amount. And collect the money to run business and management of the company by making the farmers as share holder.

Business can be done under the company- there is some example of the businesses which can be done, producer can done as per their requirement and availability-

  1. Procurement of inputs- the company can take license of the seed pesticides, fertilizers etc to sale to the members or others.
  2. Aggregation and storage of produce.
  3. Processing like drying, cleaning, grading.
  4. Brand building, packaging, standardization, labeling and marketing.
  5. They may purchase produce in big amount and sale it at higher price in other market.
  6. Export of produce.
  7. Anything which is as per their need and availability.

Economic support-

  1. Collect money from member of company.
  2. Management Fund- Small Farmer Agriculture Consortium (SFAC) provides money for the management of the company in initial stage of the company to purchase furniture, stationery etc.
  3. Equity Grand Fund – This is also providing to the company up to a limit of 10 lakh. To get this money the company must also collect the same amount from their members.
  4. Credit Guarantee Fund- up to a 100 lakh limit this amount is provided to company as loan without mortgaging anything.
  5. Direct Loan can be taken from the Bank if company is running well for more than three years and company is filling income tax return properly.
  6. How to get grant from the small farmers agriculture consortium visit the website, from where you will also find the rule and regulation about getting grant from them.

By making a farmer producer company farmers can earn more and can make their lives better.



Leave a Reply

Your email address will not be published. Required fields are marked *