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Comment by mcv | Hacker News Reader

Fruit picking is a very small part of the cost. Doubling the pay of the pickers wouldn't double the price of the fruit in the stores. Most likely, they'd cost about 10 cents extra or something. Easily worth it.

Whenever the milk price is low, we get farmer's protests that they don't get enough for their milk. Turns out they get 9 cents per liter for which I pay more than a euro. You could double their pay, include it in the price, and I wouldn't care.

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You say that and yet they opted to shut down production as opposed to raising wages. That seems to be a better indicator of the underlying reality than your opinion.

I think part of the consideration is that if they pay fruit pickers more now, they fear they may have to pay them more in the future as well. It's also possible they simply refuse to pay fruit pickers more because they strongly believe fruit pickers don't deserve better pay.

There are often a lot more factors at play in these sort of things. Some rational, some maybe not so much.

So they set a whole season's profits on fire to stick it to seasonal workers? That seems so irrational as to require at least a smidgen of evidence to take seriously.

Ever hear about NYC landlords who leave ground level properties vacant for years because they'd rather lock in a high paying tenant. Same principal.

“The works of the roots of the vines, of the trees, must be destroyed to keep up the price, and this is the saddest, bitterest thing of all. Carloads of oranges dumped on the ground. The people came for miles to take the fruit, but this could not be. How would they buy oranges at twenty cents a dozen if they could drive out and pick them up? And men with hoses squirt kerosene on the oranges, and they are angry at the crime, angry at the people who have come to take the fruit. A million people hungry, needing the fruit- and kerosene sprayed over the golden mountains. And the smell of rot fills the country.”

What is this from? Obviously it was written a long time ago, but what a travesty.

Yeah, except if fruit is left rotting in the fields, then the supply could well be overabundant anyway and the profit margin isn't worth even that small cost for the workers. Absent evidence to the contrary, I will believe that business owners are chiefly rational actors.

Fruit picking is a large part of the farmers' cost. All the extra cost of transportatation, storage, wholesale logistics, retail and markup matters for the retail price, but that's not relevant - the farmer is competing for a tiny share of that retail price, and if that extra ten cents goes out of their share that easily makes it unprofitable.

Your example with milk is a very good illustration - something that raises the farmers costs by a few cents is much more important than what it might seem based on the fact that the difference is small compared t owhat the retail buyer pays.

All the leverage that farmers have can't get them more than 9 cents/liter. That's it, there's no hope for them to earn 18 cents/liter - sure, the wholesalers probably could, but why would they gift money to other businesses without any need to do so? So if your milk production process gets 1 cent/liter more expensive (but your competitors, possibly far away, are still willing to keep the same price), you can't get 10 cents/liter, it simply wrecks your profit margin - if your profit margin was 11% (1 cent/liter profit out of 9 cents/liter revenue), you might as well go out of business since you won't be earning anything.

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