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Having a vast surplus is a very useful form of resiliency. For commodities surplus is equivalent to low prices.



How so? Low prices drive alternate suppliers out of business as well as cutting margin for players in the market from having buffers to deal with mitigations possibly needing capital cost investments to keep bringing commodities to market. e.g. if you have a temporary drought, does the farmer have enough profit such that they have savings or capital lines to buy temporary water supply to get your crop through the dry period, or money to access getting your customs setup for new markets that have had a shortage in the regular markets. Or access to buy or rent new containers in this case possibly.


Demand is price dependent, if the supply drops by say 10% the prices rise aka price X = Supply Y. But, the other way of looking at this if you’re lowering the price below X you need a supply larger than Y.

Sure, economies get used to lower prices. However the excess annual food supply is plenty should some country have a 50% drop in agricultural output you don’t end up with famine just noticeably higher prices. That’s the slack inherent in very low prices and it extends to everything from industrial steel to phosphorus.


At stable equilibriums maybe you can follow the curve up and down, but if the system has maximized profit then the equilibrium isn’t stable against variation - especially as climate change increases variations.


Farms are subsidized, they are supposed to overproduce and throw anything we don't need away. If that excess produce was used for afforestation it could even become positive sum.




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