by Thu Van
It is the most basic of all economic principles – prices rise if demand exceeds supply and fall if the opposite happens.
There is no rocket science involved here, but why are Vietnamese farmers failing to grasp this, time and again, in heart-breaking fashion?
You would know what I mean if you saw the tears on the faces of farmers from Sa Dec Town who came to HCM City to sell their flowers in the days before the Tet (Lunar New Year) festival. For them, festive cheer was in short supply, big time.
The town in Dong Thap Province is known as the garden of southern Viet Nam and its residents have been growing flowers for many years. The Tet festival is their peak season, the one occasion they can make good.
With prices falling to really cheap levels this year, the farmers had to dilute their high expectations and settle for breaking even, but even that did not happen.
The withered look on their faces as many bunches of blooms ended up in the trash can on the final day of the flower market festival made me think of similar scenes I'd seen before.
Last August, farmers in several southern provinces had to throw away a lot of dragon-fruit. We could see them trashed on roadsides, and used as food for cattle. Traders were buying them at VND1,000 (5 US cents) per kilogram.
In October 2014, farmers in the Central Highlands province of Lam Dong had to let cows eat their tomatoes since the price they were getting was far too low. Many roads were coloured red as the discarded tomatoes were crushed by cars and motorbikes.
Similar fates have befallen farmers growing watermelon and sugarcane.
In keeping with the simple economic principle, I want to offer a simplistic analysis that is open to having holes picked in it, but I am not an economist, just a concerned citizen.
One thing that stands out for me is that in all the cases recounted above, there was no market research involved. The farmers apparently grew what they wanted. When the weather is favourable, and/or when one or a few farmers do well with one harvest, many farmers ending up growing the same crop, and a familiar story repeats itself: bumper prices, bumper losses.
So we need to ask why nothing is being done to help the hard-working farmers from losing their money?
Vu Trong Khai, former principal of the Agriculture and Rural Development Training School, said that if no appropriate solution is found, the sad stories of flower villages and fruit gardens will be repeated with worse consequences.
He felt that concerned authorities should establish an agency to do consumer research and market research in order to improve the situation.
Let's see. A Sa Dec farmer said that he had cultivated daisies of all colours this year, but customers were only interested in buying purple ones. He had been clueless about this trend.
So what matters here is not the cultivation technique, or the capital needed, but the lack of accurate, relevant market information.
Agriculture officials need to find a way to better connect farmers and customers so that the former know what the latter want. Then, farmers need to act in co-operation with each other in meeting this demand so that they do not harm themselves.
What happens when farmers do not have adequate information or the means to gauge market demand accurately is that they become vulnerable to being manipulated by middlemen who exact a heavier toll for selling the produce.
Le Thi Thuy, a trader in Dong Thap Province who purchases rice from many farmers, said she could not do this smoothly without the help of middlemen who live close to the farmers and know exactly when the latter will harvest their crop and how much they are likely to produce.
I would argue, therefore, that there is a need for effective official intervention at the information end to help farmers avoid over-production and over-exploitation.
It is not fair that when the whole nation enjoys a festival, farmers, who work hard all year long to make that enjoyment possible, are unable to partake of it. — VNS