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KKFF WarehouseThrough discussions with farmers, KKFF learned that their delayed marketing and warehouse receipts system provided many financial benefits for their members. On average, after participating in the warehouse receipts program, farmers earned 15%-20% higher prices as compared with other members not participating in the program.

For example, one of KKFF’s members sold 17 bags of rice to the Pasumai Vivasayigal Kulu group for the prevailing market price of 740 rupees per 60 kg bag. After storing the rice in KKFF’s warehouse for one month, the group decided to sell their entire lot of produce in the warehouse (a total of 200 60 kg bags) since the market price had appreciated to 880 rupees per bag. The group worked with KKFF’s delayed marketing team to sell the rice, and after the group bridge loan had been repaid to KKFF, the remaining profit was shared among group members in accordance to the proportion of produce originally stored. The group earned a net gain of 20,100 rupees (approximately $433 or a 15% increase) in a period of 48 days.

KKFF found that members who participated in the warehouse receipts program used their additional income for
a variety of things including:

Rural Farmer

      • Crop insurance
      • Improved seed varieties
      • School fees
      • Establishment of small shops
      • Purchase of additional food including meat, eggs and milk
Most farmers did not use their increased income to purchase essential food items (rice, toor dal, cooking oil and sugar) for their households since these items are highly subsidized by the government through fair price shops. However, the increase in income was sometimes used by rural farmers to purchase non-staple food items, contributing to a larger overall variety in their households’ diets. Additionally, investments in crop insurance, improved seed varieties and the establishment of small shops potentially contributed to improved food security access and stability as a result of increased income (from higher yields), better quality crops, and diversified income sources throughout the year.
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