Comments on: On Dumping Tomatoes, Burning Wheat And Leaving Stands Unsold http://indianeconomy.org/2008/02/14/on-dumping-tomatoes-burning-wheat-and-leaving-stands-unsold/ Issues & insights Mon, 12 May 2008 22:25:42 +0000 http://wordpress.org/?v=2.3.1 By: EconBuddhu http://indianeconomy.org/2008/02/14/on-dumping-tomatoes-burning-wheat-and-leaving-stands-unsold/#comment-265235 EconBuddhu Thu, 03 Apr 2008 23:10:11 +0000 http://indianeconomy.org/2008/02/14/on-dumping-tomatoes-burning-wheat-and-leaving-stands-unsold/#comment-265235 Why is there no *questioning* of the economic models and theories that force farmers to waste food like that? Seems like these theories are being considered as sacrosanct (like Ten Commandments from God) and we are supposed to change our behavior to irrational (though there's a rational explanation for that behavior from the market perspective) to conform to this model. And how many of you economists/market experts have worked on a farm (even if for a few months) or grown your own food, to get an idea how nature works? Would love to read some thoughts. Why is there no *questioning* of the economic models and theories that force farmers to waste food like that? Seems like these theories are being considered as sacrosanct (like Ten Commandments from God) and we are supposed to change our behavior to irrational (though there’s a rational explanation for that behavior from the market perspective) to conform to this model.
And how many of you economists/market experts have worked on a farm (even if for a few months) or grown your own food, to get an idea how nature works?
Would love to read some thoughts.

]]> By: Abhishek Upadhyay http://indianeconomy.org/2008/02/14/on-dumping-tomatoes-burning-wheat-and-leaving-stands-unsold/#comment-265054 Abhishek Upadhyay Sun, 23 Mar 2008 09:57:38 +0000 http://indianeconomy.org/2008/02/14/on-dumping-tomatoes-burning-wheat-and-leaving-stands-unsold/#comment-265054 This is common practise in developed countries too.In EU millions worth agri produce is thrown in sea,tons of milk products are burned down to avoid the price collapse.But that was around a decade back.Thanks to liberalisation,they dont have to throw their products in sea or burn them.They now dump it in developing countries like India. This is common practise in developed countries too.In EU millions worth agri produce is thrown in sea,tons of milk products are burned down to avoid the price collapse.But that was around a decade back.Thanks to liberalisation,they dont have to throw their products in sea or burn them.They now dump it in developing countries like India.

]]> By: Vaishnavi http://indianeconomy.org/2008/02/14/on-dumping-tomatoes-burning-wheat-and-leaving-stands-unsold/#comment-265042 Vaishnavi Sat, 22 Mar 2008 15:40:24 +0000 http://indianeconomy.org/2008/02/14/on-dumping-tomatoes-burning-wheat-and-leaving-stands-unsold/#comment-265042 Hello Karthik Sir, myself Vaishnavi, a Management Student, read ur articles on economic blog. Actually I have choosen these topic for my project presentation of Economic Subject. But some related topics like the exact date, place & area is not known to me. These details are needed for my presentation which i am going to present before my whole class on 25th of march 2008, so can you please help me out for these details by mailing me on my email id: vaishu_ambkar@yahoo.com as early as possible. And i will surely reply you about the comments on presentation on the next day. Thanks, Vaishnavi Ambkar. Hello Karthik Sir, myself Vaishnavi, a Management Student, read ur articles on economic blog. Actually I have choosen these topic for my project presentation of Economic Subject. But some related topics like the exact date, place & area is not known to me. These details are needed for my presentation which i am going to present before my whole class on 25th of march 2008, so can you please help me out for these details by mailing me on my email id: vaishu_ambkar@yahoo.com
as early as possible.

And i will surely reply you about the comments on presentation on the next day.

Thanks, Vaishnavi Ambkar.

]]> By: raghu http://indianeconomy.org/2008/02/14/on-dumping-tomatoes-burning-wheat-and-leaving-stands-unsold/#comment-264871 raghu Tue, 11 Mar 2008 12:11:09 +0000 http://indianeconomy.org/2008/02/14/on-dumping-tomatoes-burning-wheat-and-leaving-stands-unsold/#comment-264871 @Karthik "but i think the revenues they get from the manure would be less than the value of the publicity they get by throwing it on the highway!" ..may be that's why some of them kill themselves because the value of publicity is more than their value to the family.. BTW: Will they also crush the dumped tomatoes with their Dodge RAMs?? @Karthik

“but i think the revenues they get from the manure would be less than the value of the publicity they get by throwing it on the highway!”

..may be that’s why some of them kill themselves because the value of publicity is more than their value to the family..

BTW: Will they also crush the dumped tomatoes with their Dodge RAMs??

]]> By: Kavita http://indianeconomy.org/2008/02/14/on-dumping-tomatoes-burning-wheat-and-leaving-stands-unsold/#comment-264713 Kavita Sat, 01 Mar 2008 16:04:31 +0000 http://indianeconomy.org/2008/02/14/on-dumping-tomatoes-burning-wheat-and-leaving-stands-unsold/#comment-264713 Hi, I am not sure if I am quiet eligible or qualified enough to comment or write here, yet its just an attempt to understand this whole system of agriculture in India. I being a software professional , feel sad that our businessmen who invest more and more into industries like entertainment, infrastructure and IT, only looking at the high profitability dont even think of investing into agriculture, like trying to harmoinse the way indian agriculture is lead. I believe most of all what is lacking in Indian farming is that great network, synergy.. our farmers dont know what is happening in Indian economics, atleast majority of them dont know if not all farmers, mostly because of lack of education. They dont understand which part of the country and how many regions are going to grow the same crop this year?, these and many more issues can be eliminated if someone takes incharge of educating them. Dealing this sector of India as a big time business. for example just as Reliance has comeup with Reliance fresh. I understand they are hampering those small scale shoppers, yet they are organizing selling of vegetables or anyting of that sort taking over this confusion of throwing things to road. Going forward I am sure it will be more organized. Likewise Can we identify and organize all the subsystems of Indian agriculturing based on what all we need to grow, and help farmers secure their hardwork by exporting the excess of it and not throw them to the road. I could be quiet ameture to suggest or comment these things because ther are already people who have dedicated themselves into this sector of India and made great researchs and even social service behind the stage, I wish to join such silent contributers who do it purely for the goodness of the country. I am learning to look at this slowly and instead of applauding Shahrukh or Malya for buying crickters I thought of spending my time in searching blogs and information on this and start my first step here. This was a helpful start looking to the above blog. thank you, Kavita. Hi,
I am not sure if I am quiet eligible or qualified enough to comment or write here, yet its just an attempt to understand this whole system of agriculture in India. I being a software professional , feel sad that our businessmen who invest more and more into industries like entertainment, infrastructure and IT, only looking at the high profitability dont even think of investing into agriculture, like trying to harmoinse the way indian agriculture is lead. I believe most of all what is lacking in Indian farming is that great network, synergy.. our farmers dont know what is happening in Indian economics, atleast majority of them dont know if not all farmers, mostly because of lack of education. They dont understand which part of the country and how many regions are going to grow the same crop this year?, these and many more issues can be eliminated if someone takes incharge of educating them. Dealing this sector of India as a big time business. for example just as Reliance has comeup with Reliance fresh. I understand they are hampering those small scale shoppers, yet they are organizing selling of vegetables or anyting of that sort taking over this confusion of throwing things to road. Going forward I am sure it will be more organized. Likewise Can we identify and organize all the subsystems of Indian agriculturing based on what all we need to grow, and help farmers secure their hardwork by exporting the excess of it and not throw them to the road.
I could be quiet ameture to suggest or comment these things because ther are already people who have dedicated themselves into this sector of India and made great researchs and even social service behind the stage, I wish to join such silent contributers who do it purely for the goodness of the country. I am learning to look at this slowly and instead of applauding Shahrukh or Malya for buying crickters I thought of spending my time in searching blogs and information on this and start my first step here.

This was a helpful start looking to the above blog.

thank you,
Kavita.

]]> By: Satish http://indianeconomy.org/2008/02/14/on-dumping-tomatoes-burning-wheat-and-leaving-stands-unsold/#comment-264366 Satish Fri, 15 Feb 2008 19:35:08 +0000 http://indianeconomy.org/2008/02/14/on-dumping-tomatoes-burning-wheat-and-leaving-stands-unsold/#comment-264366 If farmers are made to understand seasonal demand and supply situation things will solve.But dont understand charts and graph because they are ignorant. Why not follow what japanese cooperative fish farming does. Give them chart of when to produce and how much to produce. Ignorant people always follow sticks than carrots. I dont like sticks but world is like that what to do. Atleast people will benefit even if they dont understand. If farmers are made to understand seasonal demand and supply situation things will solve.But dont understand charts and graph because they are ignorant. Why not follow what japanese cooperative fish farming does. Give them chart of when to produce and how much to produce. Ignorant people always follow sticks than carrots. I dont like sticks but world is like that what to do. Atleast people will benefit even if they dont understand.

]]> By: SJ http://indianeconomy.org/2008/02/14/on-dumping-tomatoes-burning-wheat-and-leaving-stands-unsold/#comment-264355 SJ Fri, 15 Feb 2008 13:52:45 +0000 http://indianeconomy.org/2008/02/14/on-dumping-tomatoes-burning-wheat-and-leaving-stands-unsold/#comment-264355 Tomatoes on the road ? Wouldn't that cause a few accidents? Tomatoes on the road ? Wouldn’t that cause a few accidents?

]]> By: Karthik http://indianeconomy.org/2008/02/14/on-dumping-tomatoes-burning-wheat-and-leaving-stands-unsold/#comment-264346 Karthik Fri, 15 Feb 2008 05:18:32 +0000 http://indianeconomy.org/2008/02/14/on-dumping-tomatoes-burning-wheat-and-leaving-stands-unsold/#comment-264346 @shobhit i agree with you. but i think the revenues they get from the manure would be less than the value of the publicity they get by throwing it on the highway! @anon1 that you restrict supply to make more is not counterintuitive. what is counter intuitive is that destroying goods can result in greater profit. oh and trust me, many people would see stuff like warehouses as an expense, not an investment. @hamish if you follow hte link at the beginning of the post, it'll lead to my blog, where i've made a case for something like tomatina in india. @deane as far as i know there aren't any restrictions on choice of crop for farmers. and i think the way they are doing it in Sri Lanka isn't the right way to go about it. subsidies work better i think @dhruva compeletely agree with you. i'd written another piece here on the IEB a few months back (last may/june). that was about teh APMC act and consequent distribution monopoly. the previous govt tried to undo this but then this one isn't doing much @photonman i think i made the point that there isn't any collusion before sowing. and that it happens only after the thing is produced. if collusion were there before sowing, situation would've been much better. @hmmbut i think wiht the right infrastructure and information (eg. futures trading) capitalism can be much more efficient at resource preservation than central planning @shobhit
i agree with you. but i think the revenues they get from the manure would be less than the value of the publicity they get by throwing it on the highway!

@anon1
that you restrict supply to make more is not counterintuitive. what is counter intuitive is that destroying goods can result in greater profit.

oh and trust me, many people would see stuff like warehouses as an expense, not an investment.

@hamish
if you follow hte link at the beginning of the post, it’ll lead to my blog, where i’ve made a case for something like tomatina in india.

@deane
as far as i know there aren’t any restrictions on choice of crop for farmers. and i think the way they are doing it in Sri Lanka isn’t the right way to go about it. subsidies work better i think

@dhruva
compeletely agree with you. i’d written another piece here on the IEB a few months back (last may/june). that was about teh APMC act and consequent distribution monopoly. the previous govt tried to undo this but then this one isn’t doing much

@photonman
i think i made the point that there isn’t any collusion before sowing. and that it happens only after the thing is produced. if collusion were there before sowing, situation would’ve been much better.

@hmmbut
i think wiht the right infrastructure and information (eg. futures trading) capitalism can be much more efficient at resource preservation than central planning

]]> By: HmmBut http://indianeconomy.org/2008/02/14/on-dumping-tomatoes-burning-wheat-and-leaving-stands-unsold/#comment-264341 HmmBut Fri, 15 Feb 2008 00:23:36 +0000 http://indianeconomy.org/2008/02/14/on-dumping-tomatoes-burning-wheat-and-leaving-stands-unsold/#comment-264341 This is the reason why I call for inviting some good upcoming or accomplished economists on the blog. photonman said it best. Basically the market worked (or failed from a different perspective.) The actors responded to how the market priced their good. They responded very logically from the point of view of capital preservation but from a resource point of view it was a complete disaster. There is nothing "counterintuitive" in this unless this is something very new to the readers. Anon said it. The dumping of tomatoes is the result of capitalism. The perspective is from that of capital rather than resource preservation. This is the reason why I call for inviting some good upcoming or accomplished economists on the blog.

photonman said it best. Basically the market worked (or failed from a different perspective.) The actors responded to how the market priced their good. They responded very logically from the point of view of capital preservation but from a resource point of view it was a complete disaster.

There is nothing “counterintuitive” in this unless this is something very new to the readers. Anon said it.

The dumping of tomatoes is the result of capitalism. The perspective is from that of capital rather than resource preservation.

]]> By: photonman http://indianeconomy.org/2008/02/14/on-dumping-tomatoes-burning-wheat-and-leaving-stands-unsold/#comment-264327 photonman Thu, 14 Feb 2008 16:48:24 +0000 http://indianeconomy.org/2008/02/14/on-dumping-tomatoes-burning-wheat-and-leaving-stands-unsold/#comment-264327 'A monopoly is essential for implementation of this kind of a situation.' Not necessarily true. Take the case of small-time tomato farmers in Karnataka dumping their excess produce. Given their obvious lack of market clout and co-ordination, monopoly or cartel formation can be hardly blamed here (there are better things that monopolists can do, see below). The reason why they're destroying their excess inventory is quite simple - the expense involved in storing it and selling to a wholesale dealer is more than the market value of the produce itself. The wholesale prices fall simply because of the supply glut, which in turn, (in this case) is because of abnormally high tomato production. Often this happens because of uncoordinated planting, the precise opposite of a rational monopolistic behaviour! Any monopoly (or cartel) should rationally produce less produce to begin with, instead of first producing and then destroying excess produce! Look at 1980s Bajaj, Maruti or AT&T! ‘A monopoly is essential for implementation of this kind of a situation.’

Not necessarily true. Take the case of small-time tomato farmers in Karnataka dumping their excess produce. Given their obvious lack of market clout and co-ordination, monopoly or cartel formation can be hardly blamed here (there are better things that monopolists can do, see below).

The reason why they’re destroying their excess inventory is quite simple - the expense involved in storing it and selling to a wholesale dealer is more than the market value of the produce itself. The wholesale prices fall simply because of the supply glut, which in turn, (in this case) is because of abnormally high tomato production. Often this happens because of uncoordinated planting, the precise opposite of a rational monopolistic behaviour!

Any monopoly (or cartel) should rationally produce less produce to begin with, instead of first producing and then destroying excess produce! Look at 1980s Bajaj, Maruti or AT&T!

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