Read the following article on SFGATE. What is driving the boom? What are some the implications? What sort of problems is it creating for Bolivian consumers? Farmers? What. if anything can be done to "fix" the problem? Do you think the boom will last? What kind of scenario could cause a change in price?
15 Comments
Evan Eberhardt
2/27/2013 10:35:25 am
The quinoa boom is being driven by the same force that drove the Tulip boom many years ago. It is so attractive, being a health nut’s dream food, that it can make a lot of money. People are investing more and more into it, blowing it up into a market bubble that will inevitably pop. For now it is making a lot of money, driving out other crops, such as potatoes, beans and oats, and motivating farmers to abandon traditional farming practices, such as rotating crops and not over-exerting the land. As a result of these malpractices, and the massive profit in its export, there are fears of food stocks taking a hit, as well as environmental concerns. Regulating the production of quinoa could fix this and stop the crash that history has proven inevitable; but if that doesn’t happen, this bubble will pop on its own, as every previous bubble has. The supply curve will eventually shift so far to the right from over production that its equilibrium price will fall and people will realize that it has lost its value. Prices will fall, profit will be lost, suppliers will pull out of the market; then its downhill from there….
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Jessica Bernal
2/27/2013 10:38:30 am
The boom is being driven by the heavy demand from other countries and health food fanatics to have the quinoa grain since it’s believed to be an important factor in helping fight against hunger at a global level. Some of the consequences for the high demand of the grain are the high price, working strategies of the Bolivian farmers, as well as, affecting their standard of living. The Bolivian consumer can no longer afford the grain with the price being set three times as high. This can really affect the humble nations where they have at least one of every five children suffering from malnutrition. The problems the farmers face with the high demand for quinoa is the lack of technology to produce the amount needed to meet the demand without the help of technology. Also, the pressure to produce more is causing the farmers to leave their old ways of land management, which as a result endangers the insubstantial ecosystem the highlands provide. One of the things that could be done to “fix” the problem is to consider providing technology to the farmers so that they can produce the amount that is necessary without doing everything by hand. I feel like the boom will only last as long as people continue to believe the quinoa is indeed helping fight against the hunger. I think that if the countries see no change in that world hunger aspect then the demand will begin to decrease. A change in price can occur if another grain is found to be equally or nearly as effective as this one because then the prices would have to balance in order to get consumers to purchase it over the other. Right now the quinoa grain has no competition, therefore it can set the price it wants without having another grain or seed helping regulate it's price.
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Jessica Davidson
2/28/2013 01:55:39 am
Quinoa fever is running up against physical limits. Because it fetches such a great amount of money--about as much as $3,200 per ton, nearly three times as much as it was worth five years ago--Bolivian farmers are replacing other such crops as potatoes, carrots, and peas to make way for the cash crop. Because it is so expensive to the consumer, people often cannot afford it. In addition, with less variety about the land's agriculture, it is hard for the people of Bolivia to get a fully nutritious diet. About 1 in 5 children suffer from chronic malnutrition, the results of which can be devastating and potentially fatal. Quinoa is of such great value today because it is widely acknowledged as a healthy, gluten-free grain. It is in high demand in the US, as well as Europe. However, it grows particularly well in colder regions, and namely now in Bolivia. While demand may be high right now, the supply is growing out of control and will eventually grow to where it exceeds demand, causing the market to crash. It will be then that we will likely see Bolivia begin to grow its potatoes and carrots and peas again--but not without the initial incentive to stop mass-producing Quinoa.
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Tara Beltrami
2/28/2013 03:44:44 am
It became known, probably through advertising, that quinoa, is a really fine health food. It has a high protein content and amino acids. It is also gluten free.
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Kevin Bankson
2/28/2013 05:01:03 am
The boom is being driven by the demand from other countries and health food compaines to have the quinoa grain because it is believed to be very improtant in helping fight against hunger all over. People are puting more money in to this grain witch then is blowing it up and soon there will be no more room for this indistry to go anywhere and it will die out. i agree with jessica with the problems when she says "The problems the farmers face with the high demand for quinoa is the lack of technology to produce the amount needed to meet the demand without the help of technology." One of the things that could be done to fix the problem is providing technology to the farmers so that they can make the amount that is needed but by not doing everthing by hand! no i dont think it will last everthing has to end in my opion. but the facts are that when something is going so great for example the house market was going great and in a second it just crashed. and i also agree with even when he says...
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Andrea Gomes
2/28/2013 10:48:00 am
The quinoa seed's high content of protein and amino acids has lead to an increase in demand amongst health food enthusiasts all around the world. Due to this increase, the price of quinoa has dramatically increased in it's native country Bolivia, preventing Bolivian consumers from purchasing a lot of it. Statistics show that its consumption averages a little more than a kilogram per year for each Bolivian. Also, quinoa farmers have been prompted to abandon traditional land management practices, endangering the fragile highlands. As the demand for quinoa continues to increase, farmers of other goods will begin to produce quinoa as well, creating more competition. However, as more farms begin growing quinoa, supply will increase and maybe lower the price of quinoa for locals. Being that quinoa is a nutritious food, I believe that the boom will continue on. A change in price for quinoa may occur if a natural disaster occurs harming quinoa farms. This would lead to an increase in price because of a high demand and a low supply.
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Tana Aldridge
2/28/2013 01:33:22 pm
Quinoa is a seed that is grown in Bolivia. Its high in protein and amino acid. People all over the world is purchasing this "super grain" since its in high demand the prices go up. The other crops that bolivians grow like potatoes, carrots and peas are being replaced with quinoa. Now its being planted here in the United States. Its an easy grain to grow with llama manure. The llama manure has the right nutrients when mixed with bolivans soil.
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Dana Cronin
2/28/2013 01:35:13 pm
The demand for quinoa is ever-increasing due to changing consumer taste. Thus, with consumer taste shifting to a more healthy diet, the demand for quinoa increases because it's a nutritious, gluten-free, and healthy seed (used to replace grain). Also, since becoming a "trend," demand for quinoa has been on the rise due to its newfound popularity and interest spread by word-of-mouth. Some implications of this rise in demand is that, likely, new competitors and quinoa farmers will begin to pop up all over the world because it's not too difficult to grow and it's becoming a lucrative market. Unfortunately (and ironically), Bolivian consumers are not receiving their fair share of quinoa due to its high cost. However, Bolivian farmers are definitely receiving their fair share of profits. Since they hold the highest share of quinoa crop, they are receiving the most returns for their goods. In order to fix the problem, more competitors could potentially even out the market and create "perfect competition," so to speak. This would gradually lower the cost of quinoa and make it more available to those who are malnourished and who could greatly benefit from having access to such a crop. I think that the "boom" will last until consumer taste depletes. I believe that the quinoa phase is just a trend right now and will eventually fade. Once this happens, the market will plummet.
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Joseph Davis
2/28/2013 03:54:12 pm
From the article, the cause of the boom in quinoa sales is due to consumer demand for the “luxury” grain cultivated in the rich soils, high elevations, and specific temperatures of Peru’s artisanal agriculture crops. The problem lies in the actual shift of demand. As it was once a foodie’s delight back in 2009, it is now known to many more people as it is both tasty and nutritious. Suppliers in the regions of Peru and Bolivia are scrambling to meet the bar that consumers have so eagerly set, but in doing so, are depleting other delicate crops and eco systems that their economies depend on. To fix the problem either the US or UN should be advertising other grains to spur interest in something other than quinoa. If the interest can be evenly distributed over multiple products of similarity, than that could potentially keep Peru and Bolivia’s economies in balance, and help other lesser known economies thrive as well. If things keep on going the way they are now, the price of quinoa will continue to rise as supply will constantly try to keep up with demand, until it eventually just plummets out- leaving no supply of quinoa, and an unmet demand, or worse, no demand, as the price will be out of peoples reach.
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Mitchell Aiken
3/5/2013 02:28:48 pm
Quinoa! Yet another fad from health food nuts. What used to be a small scale seed has recently exploded in popularity. This is great for the farmers at the moment, they're getting more money for the crop and can live better lives, but will it last? At the current rate of expansion, and without crop rotation, the Bolivians could go from well off to broke unfortunately quickly. On top of that, unless they have a way to diversify the crop, if a disease hits it could wipe out almost all of it. I have a feeling this is similar to our recent housing boom (and crash) as prices start to soar everyone feels great and starts planting. At a certain point, however, people have to start realizing it wont be worth what it's selling for, and if there are enough suppliers the entire quinoa market could crash. Even if it doesn't, I have a feeling that the great demand for it will decrease in a few years. All too often a new health food pops up and everyone goes crazy about it for a couple years, and then it fades into the background. It may be great now, but unfortunately for the Bolivian farmers, it's unlikely to last.
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Skylar Nelson
3/6/2013 01:16:50 am
The article, "Boom in quinoa demand stresses Bolivia highlands" by Paola Flores focuses on the rising demand of quinoa and the dangers that this entails. The boom of this superfood is atributed to the elevated price that causes farmers in Bolivia for example to plant this product instead of potatoes, carots, and other food staples. The danger of this is that if someone only plants one crop, the soil becomes depleated and at a certain point lose its fertileness. Also, because of the high prices of quinoa, Bolivians can't afford to pay for it, and if farmers are only using quinoa in their fields, what will the locals eat? This relates to what we've been learning in Economics in that this situation somewhat mirrors what happened in Holland with Tulips. If this situation persists, and the soil in the countries where quinoa is produced loses its fertility, a major economic crisis will happen. For this problem to be fixed, the farmers in Bolivia and other countries need to not focus solely on quinoa and plant other crops. A hypothetical situation that could cause the price to drop dirastically would be if quinoa was found to cause a disease or if another healthfood product became a new fad. In the end, if nothing is changed, the producers of quinoa could face a huge economic crisis.
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Steffanie Lopez
3/7/2013 06:23:00 am
The article "Boom in quinoa demand stresses Bolivia highlands" by Paola Flores discusses the growing demand for quinoa and the possible dangers that are arising from this growth. It is becoming more and more popular in the health-food department for its abundance in proteins and amino acids, and for the fact that it is also gluten-free, making it practically universal for anyone to eat. This boom is occuring because the price for it is going up, causing farmers to ditch their other crops they grow to grow quinoa exclusively. This is dangerous for Bolivia because they are growing the quinoa where the llamas do not graze, and it is very important to have llamas as their manure is used as a fertilizer for the quinoa. They are also soley planting quinoa, and because of this, they aren't rotating their crops, which in return is creating unfertile soil. This is causing the price for quinoa to go up, and even though an abundance is produced, not as many Bolivians are purchasing it as they simply cannot afford it. This is bad for consumers because they are not able to purchase this staple food, and it is bad for farmers because they are not able to make enough money since no customers are buying the product. In order to fix this problem, farmers need to be more diverse in the crops that they grow. Even though quinoa can be very profitable, it has become an excess that people can't afford to buy. By planting crops that are more diverse, both the consumers and the farmers will be satisfied because the consumers will be able to purchase and eat food that is affordable and the farmers will, in return, make more money. Regardless, I don't think this boom will last. Farmers will soon realize that it is a bad idea to plant soley quinoa and they will start being more diverse in their crops. I think the scenario that is going on in Bolivia is going to eventually change the price as it is not making as much profit as it could. The farmers just need to realize that they need to be more diverse in the crops that they plant and that they need to make sure to plant their crops on fertile soil.
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Estefani Ramirez
3/7/2013 12:16:56 pm
In the article "Boom In Quinoa Demand Stresses Bolivia Highlands" by Paola Flores discuss that there is a high demand for the boom because of the high level of protein it has. The implication of this is that it is running against physical limits. The problem that this is causing is that farmers in Bolivia aren’t using the same practical skills that they us to take care of their ecosystem. If they don’t do this it will cause danger in the land and damage it as well. Not only can it damage it but also this can cause harmful food strokes and can make children suffer from malnutrition. Yet they have a high level of demand for technology to help them harvest it. With this expanding in other places the price can vary because there will be that high demand of the product and yet a cheap price to purchase this. This problem can be fix if the government regulate how much is produced. I think that the boom will last as long as people believe that it is good for them and as long as they have no competition to take them out of the market they will still be selling this product.
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Max Parriott
3/7/2013 03:23:58 pm
The huge quinoa boom is being driven by crazy health nuts who want a super food that is extremely good for the body. But with this amazing food and it's amazingly high price that is a by product of the high demand, the ways farmers are going about growing this grain as fast and plentiful as possible, the risk great damage to their ecosystem. With this great danger, but great price for each ton, farmers are choosing to hurt the ecosystem just sorbet can make a bit more money. With this continuing destruction just to produce a grain that is in high demand, the treatment of the ecosystem will probably be stopped very soon by eco freaks. A war between health nuts and Eco freaks. But realistically the UN might step in and try to help the farmers find better methods of farming. If this new type of farming causes a smaller output of grain, then it might drive the price sky high and eventually collapse on itself due to high price and in turn less demand. Health nuts just want a food that is amazing but in turn they aren't helping the earth and much end up with no super grain in the end.
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Georgia McClain
3/9/2013 03:31:57 am
In the article “Boom In Quinoa Demand Stresses Bolivia Highlands”, they address the effects on the eco system, and farmers because of the growing demand of quinoa. The boom started with the after the United Nations designated 2013 as the International Year of Quinoa because of the efforts to contribute to “global food security and fighting hunger”. However, because if this increase in demand, hundreds of Bolivian farmers have been having to stop their traditional way of farmer and cut corners to grow the largest yield. Although Bolivia provides a large present of the world quinoa, because it is so expensive, the Bolivians can’t afford it. One effort that needs to take place is taking a step back and go back to the traditional and safe way of planting the quinoa. Look back to the early depression in the 1930’s. Because of poor farming methods, erosion took place and the soil was infertile, and was no longer workable land. The Bolivians could see something similar in their near future if nothing is changed. Another aspect that needs to take place is lowering the price of quinoa for the Bolivians. The irony is, the country producing the most quinoa can’t even afford it in their own country.
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