Farmers, consumers, and small businessmen, always suspicious of and hostile to "big business" of any kind.

Attention frequently is called to the disparity in market power between farmers and marketing firms-particularly large volume retailers. This disparity is thought by some to be an important factor in the unsatisfactory income situation in agriculture. Demands for investigations and legislative action to fractionalize this power are common.

Some of the prosecutions of food-marketing concerns by the Competition Commission give evidence of the wide gap which sometimes exists between a lawyer's and an economist's definition of monopoly and restraint of trade. These prosecutions in general have done much harm by preventing or retarding vertical and horizontal integration in marketing and by causing the adoption of trade practices by large firms which are designed to keep them out of trouble with the “Competition Tribunal” rather than to attain maximum efficiency in marketing. Such misguided activities, seemingly directed at modifying conditions of imperfect competition, actually appear to assist inefficient types of marketing enterprises to stay in business. We should be better off to substitute for such activity the removal of various laws which have been passed at the behest of vested interests of various kinds generally covered by the term “small business.” If those who complain about too high profits in marketing really want to do something about it, a start can be made by removing these laws from the statute books.

The new and highly specialized activities in marketing characteristically result from individual initiative and are not planned development by a committee or a government department. Not all such initiatives are successful over the long run. Nevertheless, to shut the door to the exploitation of unforeseen opportunities by leaving no legal scope for private marketing enterprise is manifestly negative to progress.

@ bd: At the outset, I do not prescribe to socialism, Marxism, or communism (or variations of these) as an economic model but, having carefully perused your comments it seems that your understanding of "big business" is that this sector is entitled to act within a protected vacuum within our broader economy!? Essentially, it should be understood by those stakeholders in the sector that you seek to defend that "big business" is ultimately reliant on the primary producer in many ways and that without agricultural commodities, the big supermarkets and allied monopolies would not exist - take note of the empty supermarket shelves which characterised the post-land grab Zimbabwe.

Woven into this complex debate is the fact that we live in a somewhat fragile and socio-economically fragmented society where even the smallest fluctuations in prices or attempts by big business enterprises to collude in terms of fixing commodity prices at unrealistically high prices is inflammatory and outright dangerous - in essence, there are huge sectors of people living under the bread line in our country who will not hesitate to create societal or political instability in an attempt to put food on their tables. It is for this reason, that "Demands for investigations and legislative action to fractionalise this power" are indeed common and should be continued within parameters which do not interfere with principles of free market democracy but, which seek to protect the unsuspecting consumer and the primary producer from collusion by "big business" which ultimately leads to market resistance (to agricultural produce) and thus consequential breakdown of the country's food producing capacity.

It does not take an economist or a rocket scientist to understand that while a beef producer recieves R30/kg for rump steak and the consumer is expected to pay R80/kg (and sometimes upwards of this sum) - while most inputs or production costs are carried by the primary producer, a situation of unfair market dynamics is at play! We need to look further at the blinkered approach of some big business enterprises that shy away from the uneviable task of finding solutions to the festering "land issue" and in so doing, leave the commercial farmer to his/her own devices.

It is therefore high time that "big business" comes to the party so to speak and starts to understand that increasing profits at all costs is a dangerous modus operandi in a society which is described by some as being "on the brink". In addition to this, big business should play a more proactive role in ploughing back capital into skills transferal initiatives which seek to empower marginalised emerging producers.

Investors are not left with the notion that a competitive environment will be fostered around them. Rather they are being told that meeting a plethora of “public interest” criteria will be expected, and that any novelty and entrepreneurship which lies outside of predetermined acceptable practices or structures might well be prohibited.

All economies should be governed by "acceptable practice". Why are there watchdog structures in most global first world scenarios if bd's reasoning advocates that "investors" should be given free reign - seemingly outside of any guidlines/prerequisites - to exploit "novelty and entrepreneurship"? Is this really the route which society should take when considering the ever-expanding urban citizenry at large?

I am of the opinion that agricultural organisations/agri-business entities should be proactive and start investigating the formation of large urban-based co-op-style retail outlets for agricultural produce which can take produce directly from the farm to the family. Having visited ''Victoria Market" in Melbourne, Australia I was astounded at the massive public support of the various kiosks which sold almost every food commodity which can be found on the shelves of large supermarkets - at prices which were fair to both producer and consumer. Where are the agri-business people out there?

If it is believed that free markets both exploit the peasants and harm the consumers, then it is hard to believe that adjusting a few regulations could make the market work to the benefit of all.

Ask VKB if co-op style works.

@ShaneBrody. Is the watchdog structures not one of the reasons why the 1st world economies are in trouble?. To much rules which discourage entrepreneurship. Set the example and start a co-op style business.You can make money out of rump steaks and help both the farmer and the consumer.

Fractionalizing the chains, antimerger legislation and antivertical integration legislation will not improve farm income. The greater the degree of vertical and horizontal integration in marketing, the greater is the farmer's share. For example, meats are fairly perishable and involve considerable processing: yet the farmer's share of the consumer's rand is higher than for fruits and vegetables. It is notable that, despite this tendency, farmers and consumers generally have been fearful of integration and have opposed it in marketing.

A marked tendency exists on the part of those not well acquainted with agriculture as an industry to think of it in terms of well-known crops--wheat, cotton, fruits, and vegetables. One reason for the emphasis on fruits and vegetables in our thinking about marketing is that fresh produce goes all the way to the consumer without processing. The producer can see its progress though the marketing system and is more alive to the problems which he observes. Nevertheless we should keep in mind that livestock and its products also present many problems in marketing and are very important both to producers and consumers.