Read the following article. Why are prices soaring? Why would farmers want to be involved in this market despite the risks? What are some alternatives to discourage production.
20 Comments
Erin Wagner
10/5/2010 08:15:38 am
The opium from Afghanistan is obviously quite inelastic. Those who purchase it cannot get it anywhere else. So as the supply of the opium decreases the price goes up making the profit go up. Because of this raise in profit Fedetov believes wheat farmers will drop their wheat and begin to grow opium.
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Gina Vosti
10/5/2010 12:55:56 pm
Opium from Afghanistan is very inelastic. It is the only place to get it, and because it is addictive, people will continue to get it no matter the cost. Farmers can make good money from this because buyers will continue to purchase it even when the price is raised. Fedotov wants farmers to continue growing other things, such as wheat, but fears that they will resort to growing opium because of its rising market and the low prices in the wheat market.
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yanet tobon
10/6/2010 08:02:16 am
I thing that this situation was unaffected. There is no other place to get opium, and since its very addictive it will still have to be bought. Farmers that grow and sell wheat haven't been as successful as the ones that sell opium. Fedotov states that those farmers that sell wheat have noticed the low prices in wheat. So they might stop selling wheat and back to cultivation opium. Therefore the opium from Afghanistan is inelastic.
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Kaylie Talbott
10/6/2010 11:50:24 am
As much as the U.S. tries to eliminate the opium from Afghanistan, they are attempting a task that may be almost impossible. Not only does crop bring its growers a lot of money, but the people who buy it are most likely addicted to it. So either way, those addicted will find some sort of way to get it, even if they have to grow it themselves. Opium in Afghanistan is definitely inelastic. The people who need it would most likely be willing to do whatever it takes to get their hands on it.
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Bren Westerland
10/6/2010 01:28:38 pm
Gina said about all there is to say, but yes the farmers are investing in the opium because of a infection that spread in other areas that produce opium making Afghanistans opium the only thing left to get. Since the opium is addictive people have to have it and if they have to have it they owners dont have to worry about the cost since no matter what the consumer will buy, thus the sky rocket in price. Many farmers are moving to opium to get a good price while the market is high, but by the time they get a profitable crop made the infection will be over and prices could level out making the transition a waste of money.
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Desiree
10/6/2010 02:13:25 pm
Farmers want to be involved in the production of opium dispite the risk because it produces high profit and the product is inelastic so it has it's appeal to farmers. Also because Afganistan produces roughly 90% of the worlds opium it shows that it isnt that big of a risk if it can still be produced at that high percentage. Some alternatives to discourage the production of this addictive plant is to encourage the production of other crops.
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Jackie Wyard-Yates
10/6/2010 03:06:45 pm
I absolutely agree with everyone on the grounds that the opium industry is inelastic, but I still believe it can be downsized. With NATO's influence in creating a more stable and well-rounded economy in Afghanistan, I believe eventually they will transition to more food-based crops and decrease their dependency on opium.
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Lucas Wendt
10/6/2010 03:16:55 pm
I agree with Jackie in the sense that the opium can be downsized but NATO is going to have to do one hell of a job in reducing the opium output of the place that produces 90% of it. It is inelastic because of many reasons that have already been covered. Its extremely addictive properties ensure that people will continue to purchase it, and the fact that Afganistan is pretty much the only place to get it, the market will stay thriving for many years to come.
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Melani Whitley
10/7/2010 12:50:54 am
With the production being slashed in half, the price has gone up because of the shortage in opium.
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Carol Taege
10/7/2010 01:02:37 am
The prices went soaring due to their lack of equiptment and materials. Although there are risks involved in this market the farmers make good money and the prices went up from sixty to over one hundred per kilogram. Also because the unemployment rank is very high it keeps the opium trade very strong. I think that since Afganistan produces 90% of opium it will be a very difficult thing to end.
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Skylar Shea
10/7/2010 09:09:12 am
Afghanistan's annual opium production was slashed in half this year because of a plant infection in the regions of Kandahar and Helmand. The price of opium soared greatly due to the lack of supply of poppy crops. Despite the risks, opium farmers can make pretty good money cultivating these narcotic plants. The U.S. and other Western officials are seeking out alternative products for these farmers to grow but I think most farmers will stick with poppies.
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Ilce Saldivar
10/7/2010 10:54:27 am
The Opium from Afghanistan is inelastic because Afghanastian is the only place to get itand where its being grown . Even though it is addictive, people will continue to get it no matter what the cost it and the opium farmers will be recieving good profit out of the narcotic plants.While on the other hand, the Wheat farmers are loosing profit because i's not selling as much and there prices are going down.
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Shelby Zumwlat
10/7/2010 01:55:51 pm
Due to half the opium plants being infected in Helmand and Kandar, production dropped and prices rose. This is a very inelastic product making it a hot product to farm and sell. Although there are risks in order to farm these products, I think that the farmers may have weiged their cost versus benefits and they saw that the benefits outwieghed the costs. A way to discourage the selling of the opium, Fedotov is trying to encourage farmers to sell wheat, however but thinks that due to the rising prices in opium and the low prices in wheat crops, more farmers will sell more opium.
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Terry Woodworth The 1st
10/7/2010 01:59:20 pm
The inelestic afgan poppy growing will be never ending. If the US wanted to get rid of all poppy growers you would be looking at alot of P.O.ed americans for sending or keeping more people in the sand country. No matter what even if you make it illegal people who are addicted or wanna make a #?*! ton of money will get thier hands on it.
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Tess Trainor
10/7/2010 01:59:44 pm
The prices of opium are soaring because there is a shortage of the supply. Even though it is highly inelastic when someone is addicted to a substance they will continue to buy it even though they don't "need" the opium but their mind makes them think that they do. Farmers would want to become involved in making opium more than growing wheat because it is very profitable. The risks mean very little to them. In order to discourage this production of opium the government could provide the wheat farmers with more money. That is a good incentive to continue to grow wheat.
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Logan Santillano
10/7/2010 02:06:42 pm
the poppy industry described in the article is obvioulsy and clearly inelsastic. for, opium is commonly and widely used in hospitals and other medical fields. so no matter what the price or change in production, buyers will keep buying, because it is a need. the fear that the UN has is that farmers will see the need and the prices for opium, put two and two together and discover that the profit would be greater. however, there is a heavy need to produce wheat and other nessessary products for the country.
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Julia Smith
10/7/2010 02:24:58 pm
Opium is an inelastic item because people who buy it are most likely addicted to it. This means that they will pay a lot of money to get it, so whether they lower or raise the prices, they will still have many buyers. I agree with Jackie's approach to slow production of opium. It wouldn't take too long and it would definietely wipe out most of the opium. Then again, growers could alter the genetics of the plant to make a hybrid poppy that is immune to the fungus, but that would take quite a while.
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Max Northrop
10/13/2010 04:29:54 am
Less is more in the case of opium producing poppies. Because the shortage of poppy crops due to the infection that took nearly half of Afghanistan’s supply. The price of opium due to the sudden drop in supply has farmers looking to produce there own poppies so they can earn big money. After the supply returns to normal the price of poppies with drop so the consumers will continue to buy.
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Marissa Crump
10/13/2010 04:31:58 am
The prices are soaring for this poppy plant which produces opium, because there is a drop of supply which makes the product more valuable and a money maker. Farmers want to be involved in this product even though there are high risks involved because prices are high and supplies are low. So farmers want to produce poppies.
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juan chavez
10/13/2010 03:27:07 pm
The price of the opium product is soaring because there's a drop of supply. Farmers want to keep this business going although there are high risks because its just making them more and more money because of the drop.
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