Agricultural marketing

Advantages of Grading; 
Grading offers the following advantages to different groups of persons: 
1. Grading before sale enables farmers to get a higher price for their produce.
Studies during sixties and seventies revealed that on an average, the producers 
obtained a premium of 12 paise per kg of tobacco at Ongloe (AP) and Rs. 9.40 per 
quintal of kapas at Hubli (Karnataka). Graded apple fetched a premium price of 
11.27 per cent over that of ungraded apples. Graded dasheri and desi mango 
fetched a premium of Rs.31.50 and Rs.32.50 per quintal over the price of 

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ungraded mangoes. Grading also serves as an incentive to producers to market 
the produce of better quality. 
2. Grading facilitates marketing, for the size, color, qualities and other grade 
designations of the product are well known to both the parties, and there is no 
need on the part of the seller to give any assurance about the quality of the 
product. 
3. Grading widens the market for the product, for buying can take place between the 
parties located at distant places on the telephone without any inspection of the 
quality of the product. 
4. Grading reduces the cost of marketing by minimizing the expenses on the 
physical inspection of the produce, minimizing storage loses, reducing its bulk, 
minimizing advertisement expenses and eliminating the cost of handling and 
weighing at ever stage. 
5. Grading makes it possible for the farmer –
a) To get easy finance when commodities are stored; 
b) To get the claims settled by the railways and insurance companies; 
c) To get storage place for the produce; 
d) To get market information; 
e) To pool the produce of different farmers; 
f) To improve the “keeping” quality of the stored products by removing the 
inferior goods from the good lot; and 
g) To facilitate futures trading in a commodity. 
6. Grading helps consumers to get standard quality products at fair prices. It is 
easier for them to compare the prices of different qualities of a product in the 
market. It minimizes their purchasing risk, for they will not get a lower quality 
product at the given price. 
7. Grading contributes to market competition and pricing efficiency. The product 
homogeneity resulting from grading can bring the market closer to perfect 
competition, encourages price competition among sellers, and reduces 
extraordinary profits. 
Thus, the grading of product is beneficial to all the sections of society; i.e., the producers, 
traders and consumers of the product. 

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