You seem to be assuming that the producer/grower and retailer are the same company. There are often disconnects in supply chains like this where someone is hem

You seem to be assuming that the producer/grower and retailer are the same company. There are often disconnects in supply chains like this where someone is hemorrhaging money while others in the chain are doing quite well. And besides if your production costs are high there's a point where lowering the price no longer helps. eg. the cost to package it for retail distribution just adds more even more loss.