Agricultural prices again reach record highs.
In 2007-2008 the situation had been extreme, with increases ranging up to 130% on wheat and smaller increases on other agricultural products, but still great for those who live with a few dollars a day.
Because obviously it is the poorest who are hardest hit, especially since they spend a major portion of their budgets to agricultural products.
This situation had led to riots around the world, and this scenario may repeat itself ...
In the past, countries have erected trade barrirères (taxes) so that exports are redirected to the local market, where more than supply and therefore lower prices. The urban consumer is clearly the winner of this policy but the rural producer loses (it could higher prices for export). The following year, the probability that the producer improve its technical and investment is lower, so in the medium term the problem of a lack of production is not resolved because the "price signal" has been broken .
Obviously we need to find a solution, protectionism is not one.
especially since these policies have greatly asymmetric effects ... When India decided to limit its exports of rice by controlling the price on its local market because it produces a lot but this also means that a massive part of the supply market disappears Comprehensive, where an explosion in world which severely affects small importers. Today
these non-cooperative policies are still fashionable and it is feared they will remain for internal political reasons, it is urgent to find another solution for that agricultural prices is lower and less volatile.
This situation had led to riots around the world, and this scenario may repeat itself ...
In the past, countries have erected trade barrirères (taxes) so that exports are redirected to the local market, where more than supply and therefore lower prices. The urban consumer is clearly the winner of this policy but the rural producer loses (it could higher prices for export). The following year, the probability that the producer improve its technical and investment is lower, so in the medium term the problem of a lack of production is not resolved because the "price signal" has been broken .
Obviously we need to find a solution, protectionism is not one.
especially since these policies have greatly asymmetric effects ... When India decided to limit its exports of rice by controlling the price on its local market because it produces a lot but this also means that a massive part of the supply market disappears Comprehensive, where an explosion in world which severely affects small importers. Today
these non-cooperative policies are still fashionable and it is feared they will remain for internal political reasons, it is urgent to find another solution for that agricultural prices is lower and less volatile.
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