Problems in saffron industry

Growers as well as buyers are not aware of the market system
Farmers cultivating saffron in south Kashmir. [Image for representational purpose only]
Farmers cultivating saffron in south Kashmir. [Image for representational purpose only]File/ GK

The major problem associated with saffron cultivation in particular, and saffron industry in general, in Kashmir is that it is very unsystematic and unscientific. There are many reasons for it. First and foremost due to the very low level of education of the rural masses (saffron growers in particular). Also there is a non-collaboration and trust deficit issue with government bodies which is why the role of government in the promotion and marketing of saffron is low. It is found that unorganized and weak marketing mechanisms together with a large number of intermediaries hamper the growth and development prospects of the saffron industry. Furthermore, inappropriate dozes of manures and fertilizers, lack of scientific cultivation practices coupled with unscientific processing, grading, and storing, fragmented and small land holdings are factors that retard progress of saffron industry.

There is an improper credit system which is mostly through informal ways especially Dalals or local traders. Hence, a proper credit system assumes great importance in the saffron market because for most of the saffron growers, savings are insufficient to finance their cultivation and other economic activities including marketing. There are many intermediaries in saffron marketing in erstwhile J&K comprising brokers, retailers, wholesalers, firms, exporters etc. who act only in their own self-interest, exclusive of the long-lasting commercial bond side with the growers. Since, the saffron market is a lemon market or market with asymmetry (Akerlof, 1970), there is lack of good market intelligence for saffron in Jammu and Kashmir.

Accordingly, Dalals and local traders exploit the growers by buying 12 grams as 1 Tolla and sell it 10 grams as 1 Tolla to the saffron dealers, firms, retailers/ wholesalers and consumers (Ganie & Nusrath, 2016). Saffron growers are unaware of the prevailing prices of their produce in the markets. As a result, they are forced to accept low prices for their produce as offered by local traders and middlemen. Growers as well as buyers are not aware of the market system. The ill-informed consumer’s price makes an adversarial choice problem that drives the high-quality saffron from the market and leaves behind lemons (here referring to low quality saffron). Adverse choice is a market instrument that can squeeze or crush a market. And the wrong selection in the saffron market is primarily due to adulteration, low education and lack of exposure of the saffron dealers to national and international markets.

Promotion is a form of communication with a supplementary component of persuasion to welcome innovations, ideas, goods, services and henceforth persuasive communication becomes the heart and soul of promotion which is the third important element of marketing mix and an important marketing strategy. Nothing can be sold in a competitive market without advertising and promotion. It is very unfortunate that in the saffron business advertisement and promotion is not given much importance in Jammu and Kashmir because saffron growers and dealers, majority of whom is less educated, don’t realize the importance of such tools in marketing. As, majority of the saffron growers sell their produce to Dalals and local traders, the scope of advertisement and promotion is very less for them. The small firms and small traders of saffron don’t consider pricing and promotion strategies of marketing important. With the result they are unable to capture widespread markets and make good sales and profits. Certification authorizes certain characteristics of a good, person or entity. Certification marks and product approval schemes are the best ways with which a product is protected. Unfortunately, there is a lack of Certification, Regulation, and Quality Guarantee regarding saffron marketing in Jammu and Kashmir. Standardization boosts compatibility levels, quality levels and safety levels of a product. In the saffron industry adulteration is widespread because of lack of certifications and standardizations and these results in quality degradations. There is no proper institutional framework to get ISO certifications.

Communication is one of the best marketing strategies for successful marketing and by way of communication activities we attempt to influence our target market. There is a communication gap between the agricultural scientists and saffron stakeholders in the erstwhile state of Jammu & Kashmir which is why we get low production and productivity trends in saffron. Furthermore, it is because of poor educational and communication skills of the saffron stakeholders as well as the government that the growers, firms, retailers, and wholesalers face low sales and profits. Majority of the growers, small in particular, don’t trust the confirmations, recommendations and advises of the experts which reflect that the authorities and experts fail to carry their services up to the expectations of the growers.

Technical education is a pragmatic, functional and applied science containing material and sources derived from gathered field experiences, human resource development, workshops, technical training, hands-on training along with extension research and development. Saffron growers are not receiving practical short-run and long-run technical training in production, harvesting, processing, packaging and marketing of saffron. As a result, there is low production, low productivity, low quality, low education, low skills, and low knowledge of saffron stakeholders.

In order to bring efficiency in the saffron market, the asymmetrical market which is recognized as a serious problem in the saffron market needs to be highlighted and researched as well as rectified. Development of markets and regulation of saffron business are essential conditions for the control of price fluctuations and asymmetrical markets. Adulteration is the killer of quality saffron in Jammu and Kashmir. It needs attention and efforts at all levels of government to cure this disease in the saffron market. The research on saffron economy should be extended in search of the ways and means of controlling adulteration in saffron at both national and international level.

Binish Qadri is Assistant Professor, Department of Economics, University of Kashmir;

Disclaimer: The views and opinions expressed in this article are the personal opinions of the author. The facts, analysis, assumptions and perspective appearing in the article do not reflect the views of GK.

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