How does a good harvest reduce the prices and what is a good method to analyze post-harvest loss?

Reduction of prices, (given no other factors are in play) would happen according to the laws of supply and demand. Basically if a commodity is in short supply people will be willing to pay a higher price to secure the goods that they want or need. On the other hand if the sellers see that they are going to be left with a surplus, they need to bring prices down to encourage the market to buy the product. This is especially true of crops which have a ‘best before’ time attached to their production.

To estimate post-harvest outcomes you need to keep in touch with all the production input quantities and costs. Look at yields, prices, consumption trends, marketing and delivery costs. Know what influences crop prices and when is the best time to negotiate with buyers. Examine what is happening on a global basis so that you can anticipate the prices. When complete know per tonne what the process has cost and where you have been able to generate income.

However, the second part of the question is soon going to be obsolete. In these days of agricultural AI there are incredible automated processes which enable a farmer to accurately analyse the expected yield per hectare. After tracking trends in the fields farmers know EXACTLY where to take corrective measures. They can even pollinate crops in the absence of bees!!

Farmers using AI can control production expenses and manage the quality of the crops. They can identify where the land needs special attention such as additional water and different levels of chemicals. They know within a few kilograms the expected crop level. Hence, they can reduce production expenses by not wasting resources and by having the right amount of packaging for harvesting. They know how aggressive they need to be in marketing their predicted output.

Using this new technology a farmer can grow to buyers’ specifications. S/he can maximise profits by being able to produce and deliver the known level of defect-free crops to their markets.

The real question is ‘When will farmers all introduce automated AI controlled production methods to enable they to accurately produce the right quality crops as required?

Marios Didachos

A good harvest can lead to a reduction in prices primarily due to the principles of supply and demand. Here’s a step-by-step explanation of how this happens:

Increased Supply: A good harvest means that a larger quantity of the crop is available in the market. This increase in supply can result from favorable weather conditions, effective farming techniques, and adequate pest control, among other factors.

Demand-Supply Dynamics: When the supply of a product increases while the demand remains relatively constant, the excess supply leads to a surplus. According to the law of supply and demand, when supply exceeds demand, the price of the product tends to fall.

Market Saturation: With an abundant harvest, more of the product is available for consumers, wholesalers, and retailers. This can lead to market saturation, where the availability of the product exceeds the market's ability to consume it at the current price, leading to a decrease in prices to stimulate consumption.

Price Competition: Producers and sellers may lower their prices to quickly sell their produce before it spoils, especially in the case of perishable goods. This price competition among sellers can drive overall market prices down.

Storage and Transportation Costs: Increased supply can sometimes exceed the storage and transportation capacity. To avoid the costs associated with storing excess produce or transporting it to distant markets, sellers may reduce prices to increase sales volume locally.

Analyzing Post-Harvest Loss

Post-harvest loss (PHL) refers to the loss of quantity and quality of agricultural produce from the time of harvest until it reaches the consumer. A good method to analyze post-harvest loss involves several steps and methodologies:

Field Surveys and Interviews:Direct Observation: Visiting farms, storage facilities, and markets to directly observe and measure losses. Interviews with Stakeholders: Conducting structured or semi-structured interviews with farmers, transporters, storage facility managers, and retailers to gather qualitative data on where and how losses occur.

Sampling and Measurement:Quantitative Sampling: Taking samples at different stages (harvest, transport, storage, and retail) and measuring losses in terms of weight, volume, or quality. Loss Assessment: Using standardized methods to assess physical damage, spoilage, pest infestation, and other types of losses.

Economic Analysis:Cost-Benefit Analysis: Evaluating the economic impact of post-harvest losses by comparing the potential income from the total harvest with the actual income received after accounting for losses. Market Analysis: Assessing how post-harvest losses affect market prices and overall supply chain efficiency.

Technology Assessment:Evaluating Storage Technologies: Assessing the effectiveness of different storage technologies (e.g., cold storage, hermetic storage) in reducing losses. Transport and Handling: Examining the impact of transportation methods and handling practices on the integrity of the produce.

Data Analysis:Statistical Analysis: Using statistical tools to analyze the data collected from surveys and measurements to identify patterns, causes, and extent of losses. GIS Mapping: Utilizing Geographic Information Systems (GIS) to map the areas with high post-harvest losses and identify spatial patterns.

Implementation of Monitoring Systems:Loss Tracking: Developing systems to continuously monitor and track post-harvest losses throughout the supply chain. Feedback Mechanisms: Creating feedback loops where data on post-harvest losses is regularly reported back to farmers and other stakeholders for continual improvement.

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