alternate contract farming

7/31/2019 Alternate Contract Farming

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Alternate Contract FarmingA STUDY - Jatropha


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Contract Farming In India

The concept of contact farming is not new to India. In

the 19th Century, India produced cotton and indigo tosupply raw materials to European nations for theirblooming textile industry.

Contract farming is an agreement between a farmer andan agri-business firm that binds the farmer to supplyraw material, i.e. the harvest, to the latter at an agreedprice. The agri-business firm, on its part, confirms tosupply credit, packaging materials, crop sprays andarrange transportation.

The agreement between the farmer and firm is mutuallybeneficial: the farmer acquires an assured market for his

produce while firm is assured of raw material

riskmitigation being the aim.


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The aggregator, while selection of the farmer/farmergroups, checks for reliability, knowledge, willingnessalong with land area, accessibility and facilities for

processing, drying and storage. The model is used forfood crops, horticulture, estate crops and livestock.

The regulator of the model is either the Government oran NGO which ensure that laws and dispute-resolutionactivities are adhered to by both parties. Besides, theyalso ensure reduction in transaction cost, quality control,saving by farmers and research activities.


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Jatropha

Part Used : Jatropha Seeds, Jatropha Leaves.

Habitat : Cultivated throughout India.

Product offered : Seeds, Oil

Uses : Jatropha is a small tree or shrub with smooth grey bark,which exudes whitish colored, watery latex when cut. It grows

between three and five meters in height, but can attain a height ofup to eight or ten meters under favourable conditions. Oil has avery high saponification value and is being extensively used formaking soap in some countries. The oil is used as an illuminant as itburns without emitting smoke. Oil cake of Jatropha is rich innitrogen, phosphorous and potassium and can be used as organicmanure. It is a drought resistant shrub with a smooth grey bark.

It contains anti-cancerous properties. It is also used as an externalapplication for skin diseases and rheumatism and for sores ondomestic livestock. In addition, the tender twigs of the plant areused for cleaning teeth, while the juice of the leaf is used as anexternal application for piles. The roots are used as an antidote forsnakebites. A decoction of roots and leaves is given for diarrhoea.

Root bark is used in external applications for sore.


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Why Jatropha ?

Jatropha is the perfect biodiesel crop. It can be grown invery poor soils actually generating top soil as it goes, isdrought and pest resilient, and it has seeds with up to40% oil content.

Jatropha grows well on low fertility soils howeverincreased yields can be obtained using a fertilizer containingsmall amounts of magnesium, sulphur, and calcium.

Jatropha can be intercropped with many cash crops suchas coffee, sugar, fruits and vegetables with the Jatrophaoffering both fertilizer and protection against livestock.

Jatropha needs at least 600mm of rain annually to thrivehowever it can survive three years of drought by droppingits leaves.

Jatropha is excellent at preventing soil erosion, and theleaves it drops act as a wonderful soil enriching mulch.Jatropha prefers alkaline soils.


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Facts & Figures

The cost of 1kg of jatropha seeds in India is 6 Rupees (equiv toaround 0.07).

Each jatropha seedling should be given a 2m x 2m area to growinto.

20% of seedlings planted will not survive.

Jatropha seedlings yield seeds in the first year after plantation.

After the first five years, the typical annual yield of a jatropha treeis 3.5kg of beans.

Jatropha trees are productive for up to 30-40 years.

2,200 trees can be planted per hectare (approx 1,000 per acre). 1 hectare should yield around 7 tonnes of seeds per year.

The oil pressed from 4kg of seeds is needed to make 1 litre ofbiodiesel.

91%+ of the oil can be extracted with cold pressing.

1 hectare should yield around 2.2-2.7 tonnes of oil.


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Why demand for Jatropha oil isso high from US and Europe

USA and Europe are by far the largest producers ofBioDiesel in the world and more plants are underimplementation very rapidly. Since USA and Europe haveto comply with new Climate Change treaties, they need

a lot of Green Fuel in next few years. Palm oil has high cloud point / pour point and hence not

suitable in freezing weather. Since properties of Jatrophaoil are good as far as its cloud point / pour point areconcerned, it is raw material of choice of BioDieselmanufacturers.

Jatropha oil is non edible and can be grown on nonfertile lands. Jatropha requires a lot of cheap labour,hence it is not viable in US and Europe.


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Socio Business Model

Scheme 1

The NGOs then process the seed cake to Bio Fertilizer in theircentres, and sell it later. Villagers collect sufficient seeds, duringharvesting period to last for a year, but crush these to get oil asand when required.

The NGOs set up Hand Operated Expellerslike these, (which do not require electrical

power) in their centres in rural areas.Villagers come to these centres with theirbags containing any Oil Bearing Seed likeJatropha, Neem and Pongamia, (Non Edibleoils for lamps), Mahua (Edible oils forCooking) and crush the seeds themselves.The tribals carry the extracted oil home forburning these in oil lamps and for cooking.The villagers leave the seed cake in thesecentre.


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Socio Business Model

Scheme 2

The same NGOs buy the oil, extracted as above and sell it toTemples, Hotels, Households for burning them in simple lamps, as asocial cause. The NGOs also tie-up with fuel additive manufacturersand soap manufacturers for buying oil from them, at a specifiedrate. The profit from sale of oil is passed on to rural people asreasonably good price.


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Live Examples

PRAGATI PRATISHTHAN in Thane district of Maharashtra, just 100miles from Mumbai, works for Jatropha Plantation in number ofvillages, where they planted 10 million (1 Crore) Jatropha saplings,in every monsoon season, in the ADIVASI (Aboriginal) lands. Thesaplings were planted on non productive / barren land. With theseplantations, they have reduced CO2 from atmosphere, and lent asmall hand in reducing Climate Change Disasters. They planted in10,000 Acre of land during the monsoon season starting June 2009.

An Electricity Generating set is now commissioned in the samevillage. The engine runs on 100% Jatropha Oil (Not Diesel orBioDiesel blend). It lights up Two Electric Bulbs each, in 50 housesof the village.

In the village of Chapaldi in Andhra Pradesh, India, women makefuel from jatropha seeds and use it to power the village's electricitymicro-grid and irrigation pumps. Every family pays the women'sassociation with 7 kilograms of seeds per week for electricity, whilelocal farmers pay an additional fee to run their pumps. In 2003, thewomen leveraged their seeds even further when their associationsold 900 tons of carbon-dioxide equivalent emissions reductions toGermany for $4,164 - the equivalent of a year's income for the entire

village.


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What should a farmer do?

A small farmer can set up a his own nursery in 1 to 2% ofplantation area of his land. 1,600 saplings are required forplantation in 1 hectare (600 in 1 acre). He should set up anursery in March (for plants to be ready by June). Seedsare sown in soil at a distance 150 mm in square formation.

If nursery is started in any other time (for plants to beready by June), seeds should be sown in soil at a distance300 mm in square formation. The saplings should be grownin nursery till June and replanted only on onset of monsoon.There is no need of plastic bag for growing sapling. Ifnursery is set up in summer, it should be done under theshade of big trees. 2,000 kgs of Cow Dung is required for 1

hectare of nursery which is added to soil in the beginning.Soil should be moist at all the times with plenty of water.1.5 to 2 kgs of seeds are required for 1,600 saplings.


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Current Trend in Use of Jatropha

Oil

The Jatropha Oil extracted by expeller is being marketed

by us as Fuel Additive for fuel used for Diesel Generatingsets. The users have found that when added toPetroleum Fuels, @ 20 to 50%, it improves thelubrication of Engine and reduces the noise of engine.We have the entire supply chain of Non-Edible Oil Seedsgrowers, oil production and Marketing.


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New Usage Of Jatropha

Castor oil and Animal Tallow is mainly used formanufacture of Stearic Acid, and other derivatives. Since

the price of Castor oil has shot up to US$ 2.5 per liter,price of Jatropha oil (which is technically oil of WildCastor having similar fatty acid structure) at US$ 1.5 perliter is competitive for using it in place of castor oil. Mostof the animal tallow is now used for manufacture ofBioDiesel, hence its supply is greatly reduced. Pongamia

and Mahua oil can also substitute Castor oil to someextent.


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Intercropping of Jatropha WithVegetable Plants


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Jatropha Seeds


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Aloevera growing wild underneath.Intercropping with Jatropha can bring bonus benefit to thegrowers as additional yield gets additional bonus profits...


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This 20 acre Jatropha plantation hasseen no care in the last two years


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Extraction of Jatropha Oil fromSeeds


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Oil Used As Fuel For DieselGenerator


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Leftover Seed Cake to be UsedFor Bio Gas Plant


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The cake from Biogas plant is further

processed in a low cost Bio Fertilizer plant.


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Conclusion

Jatropha has the potential to be a real game changer in

the rural empowerment schemes. As it provides fuelfrom seed oil, gas from its waste cake and manure fromthe leftover.

Carbon credits can also be sold for extra income.

Replicable, and does not require any care after

plantation of saplings.


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