How could appropriate producer prices be obtained?
There has been a lot of discussion about producer prices recently. Although a solution must be found, it will be difficult as long as the reasons for low producer prices are not acknowledged or discussed openly. One of the most important reasons for low producer prices is that the whole of society benefits from low producer prices.
Although the Parliament and the Minister of Agriculture are constantly thinking about what to do about producer prices, and right now, they are feverishly thinking about what to do about them, the general political will wants low food prices. For an understandable reason: low food prices ensure that everyone has something to eat, regardless of income level. In addition, low food prices free up money for other consumption. In other words, it is precisely low producer prices that keep the wheels of the economy turning.
Opportunities and limits of trade
At the moment, the hopes are directed towards the shops, but it goes without saying that the shops have a built-in mechanism to buy as cheaply as possible. Low purchase prices allow for better margins, which can be used to finance renovations and large discount campaigns. This applies to all product groups. Why are problems arising specifically for food producers?
The biggest difference between primary food production and production in the rest of the world is that other production can simply close its doors if the trading conditions are not good enough. In this case, the store will not have that product to sell. At the level of the company producing the goods, closing down operations is regrettable, but nevertheless ethically straightforward. Because the store needs products to sell, demand and supply balance each other out. When a store wants a certain product to sell, it must find at least one manufacturer whose production cost structure matches the liquidity of the store and its customers.
Initial production comp
When it comes to agricultural production, the situation is different. You can't just stop producing agricultural products. That would mean producing hunger instead of food. Producing hunger is ethically almost unthinkable.
Agricultural producers simply cannot close their doors when the offered purchase price is too low. So, currently, price negotiations lack an important counterbalance to the inherent price bargaining of industry and commerce.
Based on cost structure
The final conclusion is that since primary producers bear a great ethical obligation, effective trade with primary production would require new ethical starting points. In addition to a state of will, a culture of agreement is needed in which a known cost structure forms the minimum level of producer prices.
Although the Parliament and the Minister of Agriculture are constantly thinking about what to do about producer prices, and right now, they are feverishly thinking about what to do about them, the general political will wants low food prices. For an understandable reason: low food prices ensure that everyone has something to eat, regardless of income level. In addition, low food prices free up money for other consumption. In other words, it is precisely low producer prices that keep the wheels of the economy turning.
Opportunities and limits of trade
At the moment, the hopes are directed towards the shops, but it goes without saying that the shops have a built-in mechanism to buy as cheaply as possible. Low purchase prices allow for better margins, which can be used to finance renovations and large discount campaigns. This applies to all product groups. Why are problems arising specifically for food producers?
The biggest difference between primary food production and production in the rest of the world is that other production can simply close its doors if the trading conditions are not good enough. In this case, the store will not have that product to sell. At the level of the company producing the goods, closing down operations is regrettable, but nevertheless ethically straightforward. Because the store needs products to sell, demand and supply balance each other out. When a store wants a certain product to sell, it must find at least one manufacturer whose production cost structure matches the liquidity of the store and its customers.
Initial production comp
When it comes to agricultural production, the situation is different. You can't just stop producing agricultural products. That would mean producing hunger instead of food. Producing hunger is ethically almost unthinkable.
Agricultural producers simply cannot close their doors when the offered purchase price is too low. So, currently, price negotiations lack an important counterbalance to the inherent price bargaining of industry and commerce.
Based on cost structure
The final conclusion is that since primary producers bear a great ethical obligation, effective trade with primary production would require new ethical starting points. In addition to a state of will, a culture of agreement is needed in which a known cost structure forms the minimum level of producer prices.
When will the day come when the new ethical agreement era for food production begins?