Comparative Analysis of Chilli Value Chains in Andhra Pradesh, India: Socio-economic and Marketing Perspectives among Contract, Non-contract and FPO Farmers

Abstract

Chilli cultivation plays a vital role in Andhra Pradesh’s agrarian economy; however, variations in efficiency, market access, and value realization persist across different farming models. This study aims to examine how contract, non-contract, and Farmer Producer Organization (FPO) models influence the performance and inclusiveness of chilli value chains. Primary data were collected through structured surveys and interviews from 135 farmers and 45 intermediaries across NTR, Prakasam, and Kurnool districts during August 2023–March 2024. Analytical tools such as Garrett’s ranking technique and descriptive statistics were employed to assess the socio-economic characteristics of farmers, landholding patterns, stakeholder participation, and value chain efficiency. The findings revealed that FPO farmers exhibited higher education levels, better access to information, and greater adoption of modern cultivation practices. Contract farmers benefited from assured inputs and marketing support, while non-contract farmers faced higher market and price risks. Key bottlenecks identified included price volatility, inadequate infrastructure, and high transaction and handling costs. The study concludes by recommending targeted policy interventions, infrastructure development, and institutional strengthening to enhance efficiency, equity, and resilience in the chilli value chains of Andhra Pradesh.