Comments by "Rutvik" (@rutvikrs) on "Business Insider" channel.

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  4. I see a lot of people in the comment section blaming Indian middlemen and capitalism for the situation where the product is simultaneously overpriced and the producers remain poor. Gleaned a bit on this from my colleague who did a paper on spice farming in India. The economics on why this happens: 1. The production of niche agricultural and minerals is economically beneficial only if it's a side hustle(truffle farming for instance). Global south often inherits a historic feudal structure or mis-allocates a chunk of its population in pursuit of the product. While a truffle farmer in the west is either pursuing it while already being economically stable or as a side hustle, the farmers in India or the rest of the global south(Africa to SEA to S.America), do it as a full time job while the money earned has to support livelihoods and capital investment into the production process. Two bad years can lead to abandonment of the profession while the practice can sustain in the global north beyond a decade. 2. The main issue with produce of this nature is on both sides of the demand supply equation. Demand is experienced in spurts and the supply is inconsistent. Unlike standard agriculture of pulses, oilseeds, cocoa, rice, wheat, sugar and corn, the outcome of the activity is highly unpredictable at scale. There can be an oversupply in one unit and total losses in another. 3. Lack of standardization leads to lack of infrastructure and supply chains. This leads to entry of middlemen who are vocational profit seekers who will experience losses most of the time and disproportionate gains once in a season or years. They have no incentive to keep a regular supply chain but hunt for deals by driving up the desparation to sell the produce. 4. If ethical traders do enter the equation, they experience near constant losses due to the unpredictability of the trade, burden of setting up the supply chains from scratch and pressure of undercuts.
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