Several institutional models have been tried in India to integrate farmers with production and value chain like Self Help Groups, farmers Interest Groups, and farmers’ Cooperatives etc. The recent model is farmers Producers’ Company, which enables farmers to organize themselves as collective, provides them a business outlook to agriculture and links them to market. The present study was conducted in Tamil Nadu Irrigated Modernization Project (TNIMP) - Phase II Lower Pennaiyaru Farmer Producer Organization (FPO). Cuddalore district of Tamil Nadu A random sample of 40 Farmers was drawn from Chinnapettai, Kaalaiyur, Solavalli and Melkumaramanagalam villages. Cost concept approach widely used for evaluating crop profitability in production was applied for this study with Rate of Returns over different cost concepts. The results of the study showed that the major expenditure was incurred on machine labour, fertilizer and plant protection measures and the cost of seeds occupied a meagre amount because there was a significant reduction in seed rate and affordable price of fertilizer and less rental value of machine labour for FPO farmers. The cost of cultivation of paddy under FPO registered farmers was found to be 8.91 per cent lower than the Non - FPO farmers. The net returns were higher for FPO farmers due prevention of intermediates. It was also observed that the benefit-cost ratio was higher for FPO farmers (1.82) as compared to Non - FPO farmers (1.57). The FPO registered farmers easily acquire inputs at right time and price and by the prevention of intermediaries, the farmers can get maximum price of their products. The study shows the cost of cultivation of paddy for FPO farmers was less than Non - FPO farmers and the net income of FPO farmers also higher than Non - FPO farmers.
Ponnarasi et al. (Sun,) studied this question.
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