Not just hoarding

January 17, 2011
Not just hoarding
(also published today in South China Morning Post)

In many cases food is produced in one place then sent to the nearest big city where it is rechannelled and repacked then returned to that place of origin where it sells at a much higher price.

It’s the middlemen who always take their slice and such middlemen are not a necessary part of the distribution system. That puts the price up.

A local co-operative marketing system controlled by local people with participation of local farmers and wholesalers-retailers could decide to supply locally first with the surplus sent out of their district to supply cities and exports.

It is much more profitable though for a producer to just sell the foodstuff to a ‘major buyer’ and forget such community sentiments.

Thus the spiralling prices because then the speculators come in and play their devastating part on the international commodities market which is a sort of gambling that arbitrates the final cost of foodstuff worldwide.

While big companies hoard foodstuff in a more sophisticated manner by withholding supplies to the international market and releasing same after a threshold price raise to get their undeserved profits, local hoarders play their part too, squeezing that extra dollar out of their poor neighbours.

This is another way whereby the rich get rich and the poor get even poorer.