Cardamom Market Information System. Project Report

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Snapshot

Cardamom, “The queen of Spices” is considered and consumed as an exotic spices ingredient in Asian foods. Its cultivation and processing happens in the traditional areas of southern India because of the unique climate, skilled labour and major trader centers.

Cardamom trade, in the past year was in news for a number of reasons. Most of the time the trade was freezed which negatively impacted the growers, traders, consumers, authorities, people’s representatives, labours, local business and government. The reasons were because of local issues, policy changes, general economic situation etc.

I, as a nominal farmer, was deeply dissatisfied with the way the current trade progressed. I tried every thing from selling my own goods, became a trader by getting my goods in the Delhi market, exported cardamom by way of working with my cousin brother, participated in future commodity trading etc. Even after getting the views from two sides, I was dissatisfied with the way cardamom is traded. After having long discussions with the elders & experienced and close observations, I felt the need following;

1.               Precise price identification	2.               Precise quality parameters	3.               Simplified & new method of trading
4.               Transparent & futuristic system	5.               Encourage more trade	6.                Benefit all stake holders

So for these above objectives I keep on experimenting with different solutions and after a long period of trial & error method, I developed a system to achieve over and above the predetermined objectives. To cover the full objectives of the system I name it as “Cardamom Market Information System”.

 Root cause analysis & Expected outcomes

I have done a “6 why” analysis where in which I structured my thought process to arrive at a solution. It is interesting to note that the last answer points to a process. This is one of the most important aspects in the” 6 Why” approach - the real root cause should point toward a process that is not working well or does not exist.

1.      Why no new traders are entering into the cardamom trade? 

Because it’s too risky and, one cannot understand the logic easily. 

2.      Why can’t a common man understand cardamom trading?

Because it’s too complex in the existing system

3.      Why is it complex?

Because there are ‘n’ number of combination possible

4.      Why can’t some learn it quickly?

Because only the experienced ones can identify and tell the difference

5.      Why require experience?

It’s more personalized & not standardized.

6.      Why can’t it be standardized?

Because one of the quality is subjective and, others are not even mentioned.

7.      Why is it so?

Because there was no system to objectively quantify it, and measure the others.

So the conclusion is “we need a system/ process to do it and make it accessible an understandable to the common man”. Now a system is been created and is called the "Cardamom Market Information System".

Project Key Result Areas

1.      Simplifying the process

The process needs to be simplified w.r.t the time cost and methods. This is for the daily operational efficiency. I want to check the compatibility of the Spices Color Chart with maximum number of samples so as to confirm the 48 colors and then optimize the card to simpler foam.

2.      Doing Various Analysis To Test Hypothesis

My hypothesis is that the current system can be improved by giving more information in the hands of public. I want the public’s confidence on the reliability of the system, to market their produce in the world market through e-commerce. I want to check the assumptions that were done in the controlled environment with the reality of actual market, so as to refine or confirm the process and system of generating information, its display, its access & its analysis by the public. I want to share the insights and identify the pitfalls with the experts, regulatory bodies and other associates so as to make the system better.

3.      Creating A Commercial Establishment Following Six Sigma Standards

The above two activities are supposed to help me in creating/ starting a commercial firm under the prevailing laws. I want the quality standards in the level of six sigma level in the process an output. As Spices Board cannot be in any ‘for profit’ activity, I am ready to take FSTL (if interested) as a partner in the above said firm. The terms and conditions are subject to negotiation.

Creating a Cardamom Index

In order to overcome the uncertainty in the market and to better represent the opportunity, I want to create a cardamom index where in which we could see the degree of influence by the pre identified 18 factors on the cardamom market. This can be developed only with a long term data and a well staffed research team. Once developed, we could predict the market with more accuracy.

Objective

The objective of the project is to “Organizing Information About the ‘Value’ And ‘Market’ Of Green Cardamom in India and Make It Accessible to Everyone”

Projects Social Objective

The projects social objective over the period of time is to attract more and more youngsters to take up farming as a profession and thereby make the sector more dynamic. The future of farming I dream of is (9 F Model),

Ø  Fast action & decision making	Ø  Fresh in availability
Ø  Funny to do	Ø  Faithful in the system
Ø  Futuristic in vision & action	Ø  Far reaching products and market
Ø  Fruitful to the farmer (profit)	Ø  Fertile soil
Ø  Fair to the consumer	Ø  Faultless in action (cost reduction)

Five Factor Theory

The value of processed green cardamom is decided by the variation in five quality parameters other than external factors. All parameters except one were objectively quantifiable (but not fully/ systematically done) measurable. The missing link was of color. I filled that gap and completed the full cycle of quality standards that are of relevance to the common trade.

The five value deciding factors and the method of measurement are as follows;

1.     Liter Weight

Liter weight measures the weight of a particular lot in a 1 liter vessel. This measure the ripeness and content quality. A better reading is the one which have a liter weight of 400gm (MCX quality). Experts can guess this by analyzing the weight felt in the middle of their middle and ring finger (which is done during auction).

2.     Moisture Measurement

As the cardamom is dried, it loses its weight to 1/5^{th of} its original weight. A proper packing and storing helps to keep the moisture content almost intact. But sometimes people might allow the goods to absorb the atmospheric moisture and thereby increase the total weight. This results in reduced quality over a short span of time. Moisture can be measured by a moisture meter. A good reading is 8. Currently experts analyze this by running their fingers through it, listening to the friction & falling noise and shaking and pressing with the hand.

3.     Grade (size)

Cardamom has different sizes. The major factor that gives the premium is the size. Its separated by way of passing the goods through a vibrating mesh with holes sizes like 8mm, 7 mm, etc. thus bigger grades stays and smaller ones falls down. Its measure from a sample, taken as 100%, then segregate the lot and then take the weight of a particular lot and thus calculates the percentage content.

4.     Seed, Reject & Foreign Particles.

This is the left over from the good and well shaped/ processed cardamom like seed, trips, split end, empty, burned, ill shaped etc. Normally manual labours segregate the good form the bad and then weight the reject to calculate the percentage content.

Foreign particle like dust, sand wood, flower ends etc constitutes the foreign particles. It does not have any properties of the cardamom. It’s completely eliminated and percentage is calculated from the weight. Currently an expert looks/ picks the relevant and estimates the percentage.

 5.     Color

Early Romans have documented that people “ate with their eyes,” as well as their palates. Color of the outer cover of cardamom is the one that is the major attractive factor. Color is measured in colorimeter terms. Color measurement is done for several reasons:

Ø  To determine ingredient effect on product color.

Ø  Determine color change as a result of storage.

Ø  Processing, and other factors.

Ø  Ensure consistency of the color ingredient.

Ø  Determine conformance to final product specifications.

Ø  Grade final products.

Colors are generally termed as first grade second grade etc in the current market. But that is subjective way of telling the color of anything. Color perception changes from time, place, person, light source etc.

Through trial & error method I found the best solution, i.e. a color chart for cardamom.

            This entire process of collecting, matching & correcting went on going from November 2011 to the date I filed for copyright. The final foam has 48 color cells. All are having the corresponding RGB values (measuring Red, Green & Blue color component composition). Thus it’s easily replicable & standardized. Why I stick with RGB is because, it’s easily readable by a human eye. It’s a universal standard use for graphic representation. Thus a standard was created to help to call or give a color a name/ identity.

  

Project Execution Plan

Current Auction System

I am proposing the trial run on the current auction system. Auction system is more organized compared to other methods and acts as a point of reference for trade by people daily. We will do the profile mapping for the entire lots that are offered for sale in the auction center. We will collect 150 gm sample from each lot with the corresponding lot number, weight, number of bags etc. This will be collected from the auction centers office before the auction commence.

Process before Profile Mapping

Profile mapping is the process by which we give each lot its corresponding quality measurement with respect to the 5 quality parameters. Thus each lot has its own identity so that each lot can be compared so as to give a percentile score which give more simpler understanding for a farmer. The following steps are to be done before profile mapping.

·         Auctioneer set aside 150 gm sample from the lots from the collection center.

·         The auctioneer will provide a certificate of recognition of each 150 gm sample as the true representation of the 1.200 kg sample taken from each lot.

·         We will approach the auction centre for collecting the 150 gm net sample from the 1.200 kg sample taken from each lot. We will buy the 150 gm sample with the corresponding lot rate. The amount will be settled after the auction is complete as, the rate is only known after the auction process.

·         We will do the transportation of the samples from the auction centre to our processing centre.

·         Sample lots received will properly document and will be given to our staff for profile mapping.

·         Each lots process flow will be documented in detail. This is to make sure that what goes in for profile mapping comes out without losing the original quantity & quality.

So the lot is ready for profile mapping. The flow chart for profile mapping process is as follows.

Description of the process

(We are taking 150 gm so as to get net weight 100 gms for grading and color sorting. The extra samples can be used for moisture and liter weight readings without losing time.)

1.     We will take a 70 gm sample from the 150 gms sample pack to put in the moisture analyzer. It gives a moisture content reading, which will be documented.

2.     We will take some sample (50-60 gms) sample from the 150 gm sample pack for taking the liter weight. Instead of a 1 liter cup, we are taking a 100 ml cup. So the corresponding reading is extrapolated (i.e. a 40 gm liter weight here corresponds to 400gm liter weight).

3.     We mix the entire sample lots and take a 100 gm net sample.

4.     We grade the sample in a grading mesh so as to get different sizes in different trays.

5.     We measure each grades percentage by way of taking its weight in a micro weighing scale. (20 gm 8 mm means 20% of the total lot is 8mm).

6.     Take each grade variety and place it in the corresponding color cell. (20 gms of 8 mm cardamom means a near to 96-100 cardamoms. All those have to be put in its corresponding color cells).

7.     After each grades color cell placing is done, each grade’s corresponding color needs to be measured. It is by way of weighting each color cells. (8 mm in color cell “PG 2” weighting 10 gms means, out of the 20 gms 8mm, 50% of it is in the color “PG 2”).

8.     Take the weight of foreign particles. It consists of anything other than cardamom or its particles like dust, wood etc.

9.     Take the reject grade. Reject consist of the following.

a.      Trips: Damage cause by pest. Affected ones loses its attractiveness

b.     Burned: Damage caused by improper drying.

c.      Split end: It loses its flavor, seeds and so less attractive

d.     Fruit: It doesn't have the attractive green color.

e.      Empty: Unripe cardamom which doesn’t have flavor rich seeds inside.

All the above needs to be separated grade wise as there is market for these reject grades and each size have different price points. This needs to be weighted to get the percentage composition.

10. Do a re-check with the input and output information.

Data Entry

We will upload the data generated with respect to;

1.      Litter weight

2.      Moisture content

3.      Cardamom size (above 9mm,8mm,7mm,6mm,5mm and below)

4.      Reject (Seed, trips, burnt, split, fruit, empty etc separately)

5.      Dust and foreign particles

6.      Color variance in each size

It will be finally put up in a tabular form; which gives the total quantity, total quantity in each grade in different colors etc. This table thus gives information about the quantity.

Auction Quantity Information Table

Color	Grade(mm)					Total
	<=9	8	7	6	5=<
Dark
Parrot	Total 9 mm PG					Total PG
Fancy
Common
Brownish
Whitish
White
Brown
Reject
Total	Total 9 mm					Total quantity

Color Names

§   DG = Dark Green	§   PG = Parrot Green	§   FG = Fancy Green
§   CG = Common Green	§   BG = Brownish Green	§   WG = Whitish Green

Data Analysis

Data analysis will be done during the course of the project. Once the project is completed, the major finds will be share with the Spices Board. Two major findings need to be done during the project. It can happen only through data analysis. IT happens after each day’s auction. They are as follows;

1.                  Rate of cardamom in each grade with a corresponding color. It will be as follows.

Color	Grade(mm)
	<=9	8	7	6	5=<
Dark		Rate of 8-9 mm DG
Parrot
Fancy
Common
Brownish			Rate of 7-8 mm BG
Whitish
White
Brown

The data analysis will help us in the following ways.

ü  Finding deviation in prices with the same lot profile.

ü  Fining the price deciding factor composition & its degree of influence. (Regression Analysis)

ü  A better understanding of the cardamom trade happening in auction system.

·         Once fully implemented buyers from any part of the world can participate in the auction. This leads to better price discovery and there by more returns to farmers and reduced inventory cost on buyers and a higher confidence on once purchase.

• ·         Farmers are no longer required to roam around or get partial information. All they have to do is to give a call and ask for a particular profile. In the future we plan to franchise the profile mapping service to more rural areas which help even the remote locate farmer to be part of the system/ updated about the happenings. Spices Board can use this as the primary data centers/ grass root level units for planned activities.
• ·         All farmers/ traders will have a unique ID which can give a report, in printed foam about his transactions in a particular period. This will help him to compare his performance with others when we give the percentile score without violating the privacy of each one. This helps him to be more competitive/ find the mistakes and correct them in the future. Spices Board thus gets the detailed information about each person/ farm.
• ·         Sellers will have a better the understanding of the nature of cardamom auctioned on particular day. This will help them to realize a better value for ones stock/produce.
• ·         Data analyzed over a period of time will help the seller to determine which auctioneer gives a highest value for his stock on a particular day. Thus he will stock exactly what he want to sell on a particular day which reduces his stocking cost , risk and increases  his cash flow and their by profit.
• ·         Buyers while analyzing the data will help them to decide on giving maximum participation for a particular auction house cardamom auction on particular period. This will put competitive pressure on auctioneers to attract maximum buyers to do trading and attract sellers for maximum participation. Maximum sellers and buyers will help to maintain the market equilibrium throughout the year/season
• ·         Buyers can take a quality position like (specialist in 8 mm parrot green cardamom with liter weight of 400 gms, moisture content of 8%, dropping percentage of 5-7%, reject 2%).
• ·         Spices Board can analyze the qualitative issues and thereby do a “Root cause analysis” for better planning and execution of corrective actions and see its result in the future period with the help of information.
• ·         Buyers with the assistance of QR codes can trace the produce and thus the trust in the produce can be enhanced. Implementing GAP (Good Agricultural Practice) is possible by this method.
• ·         Government/Elected representatives and other association representatives can talk and take issues w.r.t the cardamom market in the public with the backup of data.

• Relative oil content can be calculated with the five factors derived from the profile mapping. Stimulation with the available information will give estimated oil content in each lot. Thus buyers can understand the goodness of each lot.

Advantages (when fully functional)

       I.            Farmers/ sellers

§  World Market

§  Smart decision making w.r.t sale, stocking

§  Clarity about ones produce and hence accurate price

§  Compare his sale decision with all others over a period of time

§  Easy data mining by way of a tel-call, internet or by generating report

    II.            Traders

§  Ease to do

§  Standardization

§  Reduced risk, time

§  Better price quoting

§  Better cash & stock management

§  More brand building & value communicating possibilities

§  Compare his trading decision with all others over a period of time

 III.            Consumers

§  Easy ordering

§  Less ambiguity

§  Better educated

§  Quality standardized

§  Traceability of the product

§  No need for experts to understand/ eliminate middle men

IV.            Regulatory bodies

§  Control over the market

§  Warehouse receipt financing

§  Measurable quality parameters

§  Measurement of planned activities

§  Up-to-date data generating system

§  Upgrade to international best practices (GAP)

§  Building more transparent relationship between buyer and seller

Other Information

All the sellers (farmers) whom we had given the presentation are willing to part 150 gm from the lot they offer for sale. Their logic is by their cost benefit analysis with, near to 5 kg of goods are lost because of a variety of reasons during an year for a small scale farmer who have about 2 acres of land;  the potential information they get so as to improve their earnings. Traders too are willing to join as they get 5 times more authentic data compare to the sample they receive now.

In the future we would finance the entire operation with the sample lot receives from each lot. Spices board will no longer & should not finance this as people should have a sense of ownership in the data they receive.

People Who Assisted Me for the Project till Date

1.     Mr. Subin Joseph, Kalukunnel (H) Kanjirapally; Planter, Business man (My 1^st cousin)

2.     Mr. Punnya Murthy, Murthy Bhavan (H), Puttadi; Commission agent/ cardamom processing center manager, Vandanmedu.

3.     Mr. Venu Sunny, Farmer, Civil works contractor (Friend).

4.     Mr. Aby Thomas, Cost Accountant, Ajeesh & Associates (Cochin)

5.     Two computer graphic designers.

About the Author

I am a planter. I look after my cardamom estate at Mapara (near Shastamnada) in Vandenmedu village. I became an active farmer for the past four years.

Professional Background: 

I worked with a consulting company named “The Banyan Tree”, Pune as the Marketing Manager. I was associated with projects like

• Developing Agri application in Nokia mobile phones (Nokia Life).
• Developing dealer network for ICML (Rhino) and ITL (Sonalika Tractors), Punjab.
• Done consultancy work for GE India for Effluent treatment plants in India.
• Market size for industrial adhesives for Henkel India.

Milton plastics (food packing) as Marketing Officer, and achieved the following

• Converted clients like Liberty foods (Wal-Mart vendor), Café coffee day etc
• Improved the efficiency in the factory production system
• Entry into new sectors, new products etc.

I did my MBA (PGPEL) from SCMLD Pune, an institute chaired by Shri. T.N Sheshen and run by Prof. M.S Pillai. I am Six Sigma Green belt certified quality specialist.

I did my UG (BBA) from Marian college Kuttikkanam. I was the college union chairman.

Family

I am from the Kalathoor family based in Pala. My Father Mr. Thomas Joseph was a coop contractor and now a planter. My Mother Ms. Celin Thomas is a housewife. I have two elder sister and two younger sisters and all are happily married. I am Married to Ms, Sonia George.

Contact Details

Mr. Jeff Thomas

Kalathoor (H)

Parathodu P.O

Podimattam

Kanjirapally, Pin: 686512

Ph: 9745882520, 04828-234052, Email: jeffthomascm@gmail.com