Dutch Disease

Big Apple and Luis continue to dominate our Fresh Produce Industry Discussion Board, but I do note we see steadily increasing membership (now 71) and I have no doubt other members will chime in as they are inspired.

On the topic of Chile's troubles, Luis writes this interesting post that I wanted to pass on:
From Luis:


The currency situation resembles what economists term "Dutch Disease"
(please see "Core Model" if interested) http://en.wikipedia.org/wiki/Dutch_disease
It has been a long-running Chilean issue due to their ample mineral resources and there is no clear "solution" that does not involve trade- offs. Salmon exporters are also feeling it and had their share of disputes with miners over mine run-off leaching into fjords. What is disturbing is that there have been strikes not only at major produce exporters but also at the largest copper mine. Not to mention, discontent regarding the bungled Plan Tran-Santiago (i.e. urban transport in Santiago) and more speculatively, generally higher reported incidences of crime. Not much in the way of higher employment is expected from the mineral boom.
This not be alarmist or anything as Chile is far from being a basketcase and one should not generalize. It is a wonderful, modern country and as safe as here in the US if one exercises common sense.
Please find a link below to a video report on the freeze. It is in Spanish but here is the gist:
http://www.zshare.net/video/3140091c480862/
The worse freeze in the last 20 years have prompted the government to declare the provinces of Coquimbo and regions of atacama, valparaiso, libertador Bernardo Hill as disaster areas.
Growers report the freeze was like a torch going through the fields of various kinds of produce as well as dead mature avocado trees. Growers will have to incur repair/re-planting costs besides foregone sales and also point out that the lack of employment may lead to an unstable workforce. The figure of $100 million dollars has been floated as a damage estimate but the official government estimates are due in a few days. Assistance may include debt relief and emergency funding.
The calamity of frozen crops does not translates to frozen prices. Retail produce prices in the La vega supermarket have been climbing.