Standing in an onion field in a village outside Pune, Chandra Kant can check weather reports, get crop spraying information and find out how much onions are fetching at the local market, all on his mobile phone, for 175 rupees (£2.19) a quarter. The service is being offered by Reuters, better known for offering news and financial information to City workers for whom £2 would not cover a run to Starbucks.
Kant is not yet sure about the service, Reuters Market Light, and wants to wait to see how it performs against the local newspapers and television station but Reuters is hoping that, if it can convince enough of India’s 250m farm workers to sign up, all those rupees could add up to a big business. So far the company has about 250,000 customers in Maharashtra, India’s third-largest state, for its service that provides weather reports over a 50-mile radius and crop prices within a five-hour journey.
From Times Online. A couple of weeks ago I had the chance to speak with Amit Mehra, the manager of Reuters Market Light, about the initiative and was very impressed. One thing which the Times Online article fails to mention is that Reuters Market Light uses a very different, and in my opinion superior, system for gathering and reporting local ag spot prices than that employed by local newspapers. Newspapers typically rely on middlemen to report the range of prices observed in the market each day for a given commodity. The problem with this method is that the maximum and minimum quality of the produce that shows up in a mandi on any given day can vary quite a bit so these figures are often difficult to interpret. Unfortunately, the middle men are usually unwilling to provide more specificity when it comes to prices out of a fear that farmers will then demand a certain price when selling their goods.
Reuters Market Light takes a different approach. Rather than report a range of prices, Reuters provides the exact spot price for a given quality level of each commodity. Doing this takes more effort – the person providing the prices must be able to precisely discern between varying levels of quality -- but it is much more useful for farmers. Once farmers have a feeling for the level of quality for which prices are reported, they can use this as a benchmark for determining the appropriate selling price for their own goods. In interviews with farmers in Gujarat, respondents repeatedly told us that they would greatly prefer a system of spot price reporting based on a single price for a specific level of quality for each good.
Congrats to the Reuters Market Light team for all the good work so far and good luck in the future!
3 comments:
Doug,
Innovations like Market Light are exactly the types of stories we at ThinkChange India cover. We are a blog focused on tracking social entrepreneurship and innovation in India. We encourage you to check us out at thinkchangeindia.com.
If you like what you see, please add us on to your Sites We Like list, as you are already on our blogroll and we regularly reference you.
Hi Vinay,
Thanks for the tip. In fact, we already have you guys on ur "Sites We Like" list and I read your blog every day.
Keep up the great work and thanks a lot for linking to us!
Sorry for the overlook, but it is great to see that we are both helping the other out in covering the Indian subcontinent. I would like to echo as well to keep up the great work on your end.
Best,
Vinay
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