eNAM, transforming agricultural trade for a better tomorrow

The electronic-National Agriculture Market has emerged as a game-changer in India’s agricultural sector, witnessing a remarkable surge in trade volumes by 41% to 18.6 million tonnes, and trade turnover increased by 32% to Rs. 74,656 crore for the fiscal year 2022-23. Furthermore, the platform has facilitated the trading of innovative products, including silk cocoons, saffron, and bamboo, showcasing its versatility and potential.

Notably, eNAM is expected to gain more momentum in the coming years as more and more farmers use it for agricultural commodities trade.

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What is eNAM?

A pan-India electronic trading portal called the electronic-National Agriculture Market (e-NAM) connects the existing APMC (Agriculture Produce Market Committee) mandis to produce a unified national market for agricultural commodities. This trading platform has been created with an investment by the Government of India (through the Ministry of Agriculture and Farmers’ Welfare).

The eNAM platform, launched in April 2016, is gaining acceptance among farmers, traders, and FPOs. It aims to promote uniformity in agriculture marketing by streamlining procedures, removing information asymmetry, and enabling real-time price discovery based on demand and supply.

Current scenario

In the 2022-23 period, agricultural product trade surged by 41%, reaching 18.6 million tonnes compared to last year’s 13.2 million tonnes, as more farmers, traders, and Farmer Producer Organizations (FPOs) in various states embraced eNAM. In terms of value, trade turnover also rose by 32% to ₹74,656 crore, compared to ₹56,497 crore in 2021-22 through e-NAM. 

According to the agriculture ministry, since its inception seven years ago, Rs 2.79 trillion worth of trade has been recorded on the e-NAM platform. In the April-June quarter of the current fiscal, there has been a 290% annual spike in inter-mandi trade on e-NAM to Rs 336 crore. 

Presently, the e-NAM platform allows online trading in 209 agricultural, horticultural, and other commodities notified by respective state governments. At present, 1,361 mandis in 27 states and Union Territories are integrated with the e-NAM platform. Also, 17.56 million farmers, 2,761 FPOs, 0.24 million traders, and around 0.1 million commission agents are registered with e-NAM.

Considering this rapid growth, eNAM’s turnover is expected to surpass Rs 1 trillion in FY23. The trade conducted through eNAM is still a fraction of the total trade in agricultural commodities in the country, estimated at around Rs 6 trillion (excluding milk and marine products). 

The inter-mandi trade

In the last six months, trading amongst various markets within the states in commodities has increased 36% to 2,36,140 metric tonnes in 2022-23 from 1,74,268 metric tonnes in the previous year. It was worth ₹2.41 crore, up 117% from last year’s ₹1.11 crore.

Most traded products through eNAM are copra (Tamil Nadu), dry fish, coconut, betel leaf, and tamarind (Odisha), soyabean (Maharashtra), jeera (Rajasthan), tomato and raw mango (West Bengal), and mustard and vegetables (Jharkhand).

Using the e-NAM platform, traders from outside Tamil Nadu who possess unified licenses can now buy and sell copra, groundnuts, turmeric, cotton, maize, paddy, bajra, and moth. Recently, Uttar Pradesh has allowed traders from outside the state to buy potatoes, tomatoes, bottle gourd, bitter gourd, mango, green chillies, carrots, and lady fingers from farmers using the e-NAM platform.

What drove the surge?

The eNAM’s growth is expected to continue, transforming the agricultural trade in India. The surge in trade on the eNAM platform can be attributed to several factors:

• Increasing Adoption and Awareness: Farmers, traders, and FPOs have adopted and become more aware of the eNAM platform as a result of ongoing marketing and awareness-building efforts. Stakeholders are becoming more open to using digital platforms for agricultural trade as they learn about the advantages and conveniences eNAM offers.
• Improved Market Access: eNAM enables farmers to access a larger market beyond their mandis, reducing intermediaries and allowing them to explore new possibilities and obtain higher prices. It eliminates geographical barriers by connecting farmers with buyers from different states, expanding their customer base and sales potential.
• Price Discovery and Transparency: The eNAM platform uses open bidding to provide transparent price discovery mechanisms. Farmers can keep an eye on the current market rates and decide when it is best to sell their produce. This transparency fosters fair competition and reduces information asymmetry, enabling farmers to negotiate better prices for their commodities.
• Government Initiatives and Policy Support: The government is promoting eNAM adoption through policies, encouraging state governments to integrate mandis with the platform, and enabling farmers and traders to participate. Additionally, initiatives such as unified licenses for traders across states have facilitated inter-state trade, further boosting the eNAM ecosystem.

Future ahead

Looking ahead, the eNAM platform’s expansion and influence in the agricultural industry are set to continue. Its transparent and efficient marketplace empowers farmers, ensures better price discovery, and broadens market access. As more stakeholders embrace the digital revolution in agriculture, eNAM will play a crucial role in reshaping India’s agricultural sector, fostering sustainable growth and prosperity for the farming community and the entire nation.