Economic Impact of Farmer Producer Company Membership on Maize Cultivation in Kollegala, Karnataka, India

Abstract

Maize is an important crop in Indian agriculture, especially in Karnataka, where it contributes significantly to food security and industrial value chains. Similar to other farmers, smallholder farmers face perennial challenges of expensive inputs, scattered land holdings and restricted market access that impair their profitability. The Kollegala Horticulture Farmer Producer Company Limited (KHFPCL) has emerged as a transformative solution, providing collective procurement, technical support and stronger linkages with the market. An econometric study based on a comparison of 160 farmers 80 KHFPCL members and 80 non-members was undertaken to determine the economic impact of membership in KHFPCL on maize cultivation. Primary data were collected through structured interviews and key cost components like labor, seeds, fertilizers and plant protection chemicals were analysed. Using descriptive statistics and t-tests, the findings revealed that KHFPCL members achieved higher productivity, with an average yield of 25 quintals per acre compared to 23 quintals for non-members. Besides reporting 22.9% higher gross returns, members also achieved 53.3% more net returns based on reduced inputs and better resources management. All these results put forward the sizeable economic gains of Farmer Producer Companies, signifying their prospect to improve profitability for small-scale farmers, maximize cost structures and strengthen market access, which is eventually going to contribute to sustaining agricultural communities. Statistically significant gains since KHFPCL members have higher productivity, gross returns and net returns Policy interventions should strengthen FPCs, input access and promote sustainable practices for resilience of farmers.