nusa on Nostr: Prices keep falling because producers find ways to produce at lower costs and sell at ...

Prices keep falling because producers find ways to produce at lower costs and sell at lower prices. Wheat will always cost something to produce and on top of that is dependent on yearly weather patterns. As long as there is demand for bread, it will be worth it to produce at some volume. The current market signal of wheat is mangled beyond recognition where I’m from in the name of stomping out volatility, which is marketed as the villain. Crops have good and bad years. There should be volatility. But then the factory, built on the fairytale of stable wheat price suddenly can’t survive, because all the slack has been optimized out of its operations. Then the government is ‘just trying to save jobs’. There’s a whole chain of interventions that each tries to fix a side effect of the previous intervention. We are so deep into this, that it colors everything.
Anyway, prices don’t just fall to zero, except for things we no longer want or they fall into a basket of a bigger thing and don’t exist as seperate products anymore. In all other cases, someone is charging you something, even if it’s not money.