Market share – for Apr. 7, 2011

It is very odd that a master in economics (Greg Petryshyn,Western Producer,March 17 letters) is confused by my simple observations of post-board Australian wheat marketing.

Mr. Petryshyn says that it is impossible for a multiplicity of buyers to drive the price of a commodity down.

The number of real buyers, end-use consumers, of Australian wheat of course has not changed but paragraphs in his letter show that he is using the same definition of buyer as I was, a trader working on a margin.

A multiplicity of traders looks like many buyers from the dry side of port, but looks like many competing sellers from the wet side. And sellers do try to cut each other for market share.

Why would an end user seek out anyone but the lowest priced supplier of a specific product? Especially if there are now nearly 30 hungry suppliers to choose from?

Did anyone else notice that Mr. Petryshyn never refuted the fact that the relative price of wheat in Australia has dropped since the loss of the Australian wheat board?

Glenn Tait,Meota, Sask.

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