THE WORLDWIDE tin cartel is collapsing in a pile of debts. Since the causes of its collapse extend far beyond the tin market, the event is not to be dismissed as the isolated misfortune of one relatively small industry. But the misfortune is genuine. Some of the producers are small countries heavily dependent on exports of that one commodity, and -- at least in principle -- there was something to be said for an international attempt to stabilize the price. Tin accounted for about a third of Bolivia's export earnings, for example, and for Bolivia's hard-luck economy the failure of the tin agreement is a disaster.

Prices of commodities in general have been falling throughout the world for the past year and a half. It's not only Arabian oil and American grain but a vast range of raw materials and foodstuffs. This decline has taken producers by surprise. They had assumed that, as in the past, economic growth in the industrial countries would tighten demand for commodities and push prices steadily upward. But the industrial economies have been growing for three years, and commodity prices are falling.

The International Tin Council, a consortium of 22 member governments, had been ticking along inconspicuously in London for nearly three decades. Its method was to impose production quotas on its members and then to try to hold the world price at agreed levels by buying into its buffer stockpile or selling out of it. But some important newcomers to the business -- Brazil and China -- were not members, refused to recognize the quotas, and began exporting large volumes into a weak market.

Then the decline of the American dollar's exchange rate added another kind of downward pressure. The Tin Council did its business in British pounds, but many of the major buyers deal in dollars. If the dollar price held steady, the price in pounds fell along with the dollar. The Tin Council was trying to prop it up with heavy buying. But that was expensive. Two weeks ago the manager of the stockpile ran out of money and suspended operations -- at a point at which the Tin Council had over $800 million in debt outstanding to London traders and banks. That debt has now created a medium-size financial crisis in Britain.

Nobody currently knows what the price of tin might be. The big buyers are holding off to see what happens next. The parallels between tin and oil or grain ought not be exaggerated, for each of these commodities follows its own peculiar rules. But sheikhs and American farmers would probably agree with the stunned producers of tin that, while the benefits of lower prices can be substantial, they do not offer a free ride to everybody -- or a safe ride.