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Old 10-05-2012, 02:37 PM   #6 (permalink)
Nicolas Naranja
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Default Re: Plantain price gauging

Quote:
Originally Posted by PR-Giants View Post
These prices of $0.80 to $1 in supermarkets have been common for more than 5 years, and it was comical to see it make the Front Page.

Here is my take on the issue.

Puerto Rico is a closed banana market, no imports allowed.
Even though the farmer is getting a high price of $0.30 to $0.35, this is not the root of the problem.
Labor costs are high here and it is very difficult to steal employees from Uncle Sam, his financial package with benefits is higher and nothing is expected in return. A person can sit on their couch and watch free cable TV or talk on their free cel phones.
The Banana Industry here is mostly small family owned farms and the system works fairly well, but the consumer does pay a slightly elevated price to keep these farms operational.

I believe the problem is with the reduced competition in the supermarket business. When one company controls the majority of retail sales, they seem to set the market price and the others follow. It might be possible that government predictions will prove to be correct and by having one or two large stores the prices will fall to all time lows, but this has not happened yet.
I saw the writing on the wall many years ago, the BOX STORE does not like to operate in a closed market system. As their influence grows they will probably be able to open the market for imported bananas. By mantaining high platano prices they will gain some public support for openng the market.
In the meantime I see Mom & Pop stores that are struggling to survive sell platanos for $0.50 each, and I also see street vendors selling for a dollar. The solution lies with the consumer, stop paying a dollar and start visiting your local M&P stores.
A retailer will charge what consumer is willing to pay, a consumer with less options is willing to pay more and your local BOX STORE will gladly assist you.
Imagine an Island after a BOX STORE has been able to eliminate the competition of the Farmers and M&P stores, sounds like PARADISE with GREAT VALUE.
The large plantations in other banana regions are more mechanized, have more fertile and level farmland, with much lower labor costs.

FYI
I am not against BOX STORES or the Free Market System. For the FMS to be equal and fair maybe people and goods should both have the ability to travel freely. My guess would be that the population of Chicagoland would skyrocket, offering the highest benefit package with all advertising done by word of mouth. Why labor in the fields when you can get paid to live in climate controlled public housing in the Windy City. Less developed countries would be forced to increase income levels or risk losing their workforce to a couch somewhere in the U.S.A.
I've often thought it was funny that we have people risking death to come work in this country, and people that are born here are happy to sit and collect a check. Florida's governor had talked about requiring people on assistance to volunteer 10 hrs a week and you would have thought the he was asking them to prostitute themselves. I have no problem with government coming in and helping out the poor, but the public ought to get something in return. And the outrage about not being able to buy junk food with food stamp was absolutely a farce.
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