Abstract
The present study highlightened the important issues of agricultural marketing and price behaviour of mustard in Bangladesh both at micro and macro level. It also focused about the growth rate and instability in price, area, production and yield of mustard in the selected districts along with area response to various economic and non- economic factors and future demand supply estimation of mustard in the next 6th and 7th five-year plans of the country. The study was confined in five mustard producing districts namely, Tangail, Comilla, Jessore, Mymensingh and Patuakhali, which account for more than 43 per cent of the area and 30 per cent of total production in Bangladesh during 1997-98. A total of 150 farmers were selected by using simple random sampling technique while; 150 traders were selected as samples from each group by using proportionate random sampling technique. Six performance indicators were used for measuring marketing efficiency. Time series and cross section data were used for estimating demand for mustard in Bangladesh. In time series analysis, single equation models taking separately price and quantity as dependent variables and for income elasticities, cross section data were used. For area response, Nerlovian Partial Adjustment model was used. Majority of the farmers (85%) sold their produce to the small village traders and in the primary market, whereas a few of them (15%) sold their produce to the secondary market. On the basis of quantity, about 76% of the surplus of mustard is marketed in the secondary market, while it was only 24% in the primary market. Among the selected four major channels, the producer's share was the highest in channel-III (60.45%), which was considered as an efficient marketing channel. This higher share was made possible due to the reduction of some middlemen between producers and consumers. It is mentionable that the extent of annual fluctuation of price was maximum for Patuakhali district in terms of lagged price and random price fluctuation. The extent of random fluctuations was lower than the extent of annual fluctuations for the prices of mustard in all locations. The result indicated that annual range of fluctuations in price, area, production and yield in the recent years were more stable compared to that of later parts of the eighties. The extent of fluctuation for both area and production was highest for Mymensingh district but in the case of yield it was highest for Tangail and Patuakhali districts. All the markets are significantly correlated except Patuakhali district, mainly due to poor communication linkage between Patuakhali and other districts. The growth rate of mustard area was positive and highest 7.57% for Tangail and 0.67% for Bangladesh as a whole. Non-significant negative growth rate in area was found for Mymensingh and Comilla districts. The farmers of Jessore, Mymensingh and Bangladesh as a whole registered positive growth rates, while Tangail, Comilla and Patuakhali districts obtained negative growth rates in terms of both production and productivity per annum. The elasticities of acreage with respect to relative price variable were 0.203 for Mymensingh, 0.190 for Patuakhali and 0.188 for the country as a whole. The supply response analysis of mustard revealed that price variable rather than non-price variables were significant in determining the area response of mustard (except rainfall in Tangail) in different locations. The farmers of Comilla, Jessore, Mymensingh and Tangail districts have not responded significantly to various prices and yield factors. The factors like irrigation and sowing season rainfall was relatively weak and insignificant, influencing mustard area, while the relative yield, relative gross return and their risk factors showed significant negative impact and the farmers in the study areas were risk averse. The average yield and value productivity per hectare of mustard has declined significantly in various districts due to shifting of better quality land from mustard to other crops like wheat, rice, potato. The result indicated that the scope for increasing the area under mustard appeared to be very limited in the study areas. The price and income elasticity of mustard was estimated to be -0.21 and -1.52 respectively. The negative effect of price and income reflected that the consumption pattern of mustard oil will decrease due to negative income effect. In cross-section analysis, income elasticities as obtained from logarithmic functions were 1.14, 0.53 and 0.60 for national, urban and rural areas respectively. If past growth rate in production would continue in future, the future deficit of mustard is likely to increase to 1.29 lakh tonnes (49%) and 2.32 lakh tonnes (85%) respectively by the end of sixth and seventh five year plan period. The deficit goes on increasing both in absolute and in percentage terms at about 1.50 lakh tonnes (62%) and 2.59 lakh tonnes (106 %) respectively during the same period of time when production was estimated on the basis of area response function. The total shortfall of edible oil during the sixth and seventh five years plan period was about 4.87 lakh and 7.15 lakh tonnes respectively of the total demand. Increase in domestic production through modern crop cultivation, use of marginal land, inter-cropping of mustard with other crops, growing mustard in different suitable cropping patterns, development of communication system, establishment of oil mill and storage facilities adjacent to growing areas, efficient cooperative marketing system, fixation of minimum support price, ensured producers share and effective price policy measures are some of the major alternatives to achieve higher production to meet the future demand for mustard in Bangladesh.