Major Issues Involved in functioning of APMCs

♤ Under the APMC Regulation, no exporter or processor could buy directly from the farmers, thereby discouraging processing and export of agri-products. This creates a monoposony (a market situation where there is only one buyer who then exercises control over the price at which he buys) situation.

♤ Due to above situation of monoposony produce is procured at manipulatively discovered price and sold at higher price, defeating the very purpose of APMCs.

♤ Markets are overly-regulated leading to lot of corruption and exploitation of farmers.

♤ Fragmented markets, multiple levy of license fees, limited licenses, late payment for the purchase, unavailability of amenities and services such as facility for grading, storage etc. actually act as an impediment to the cause of farmers rather than benefitting them.

♤ Only State Govt. could set up markets, thereby preventing the private sector from setting up markets and investing in marketing infrastructure.

♤ APMCs play dual role of regulator and Market. Consequently, their role as regulator is undermined by vested interest in lucrative trade. Generally, member and chairman are nominated/elected out of the agents operating in that market.