Declining Commodity Prices Not The End Of The World

Corn stalksTo refute Chicken Little, the sky is not falling. Last week, I spent some time in Manitoba talking with ag retailers and growers at a Wolf Trax-sponsored tour of agriculture in the Canadian province. In between touring grower operations, research fields and a communal farming colony, much of the talk centered on the recent fall in commodity prices taking place in the U.S. Many of the attendees were near panic stricken that corn futures were trading in the mid-$4 per bushel range and soybean futures had dropped below $12.

When these individuals asked me my thoughts on this matter, I replied with one simple word.


I’ve covered the agricultural marketplace for 13 years now. In the time, I’ve witnessed a seemingly endless cycle of commodity price ups and downs. Heck, in 2000 when I first started working at CropLife magazine, corn regularly traded in the $2.50 per bushel area and soybeans were around $7.50. Back then, the prospect of $4 corn and $10 soybeans would have been cause for celebration. Today, however, following roughly four years of near-steady prices of $7 corn and $15 soybeans, any prices less than these are viewed as something of a disaster.

But if there’s one take-away from my time spent in agriculture, it’s that this industry is very resilient and adaptive to whatever changes come its way. So I have no doubt whatsoever that the majority of ag retailers and their grower-customers will continue to make money from agriculture, regardless of the commodity prices points. After all, with the world’s population expected to hit nine billion in the next few decades, commodity prices will inevitably go back up.

Leave a Reply

One comment on “Declining Commodity Prices Not The End Of The World

  1. As we sometimes sit and contemplate what happens with prices of commodities such as corn, soybeans and wheat anyone of us who have lived in the world of agriculture that yeah the swings in prices are here. So I counter by asking all to look at land prices at all time bulging prices – that cost to production is staggering. Look at the price of high quality seed corn with the technology traits, $300+ per bag which covers a dash over 2.2 acres per bag. Prices for fertilizer are nothing short of cough, cough that was a lot per acre. Insecticides, herbicides, fungicides, fumigants cause one to stagger backwards. Harvesting costs rise each year, trucking fees, taxes, licenses, good labor cost to keep good people and we note that $4.00 corn is doable, what? Have you really counted up all the costs for the grower? Even with top management strategies, hedging, watching the market 4X per day we feel the incredible squeeze of the margin shrinking and shrinking. Should we all call the auctioneer, by no means. But I recommend we really count the costs, step into the shoes of a farm manager and see what it takes. Yes there is a good deal of money that exchanges hands but the grower feeds a village full of people each day and does not live like a king – so I challenge us to look at those costs and what the profit margins really are.

Eric Sfiligoj Stories

Monsanto Sign
Eric SfiligojMonsanto And Syngenta: Stonewall Street
October 5, 2015
Recently, I was taking part in an industry-related golf tournament and happened to find a lost golf ball sporting a Read More
Eric SfiligojMACA Young Leaders Speak
September 28, 2015
For the past several years, one of the highlights of the annual Mid America CropLife Association (MACA) meeting is hearing Read More
Winter wheat
Eric SfiligojGlobal Agriculture Outlook: The China Syndrome
September 21, 2015
As the agricultural marketplace has reached the middle of the second decade of the 21st century, its fortunes have become Read More
Eric SfiligojThe Brave (& Rapidly Changing) New World Of Agriculture
September 14, 2015
No one who regularly follows the agricultural marketplace can be anything but amazed at how rapidly things have changed. In Read More
Top 100 Articles
Southern States Co-op Storefront
CropLife 100Southern States: Always Ag Authentic
October 1, 2015
If people were to judge a book by its cover when visiting Southern States Cooperative’s (SSC) Richmond, VA, corporate headquarters, Read More
Crop InputsLand ‘O Lakes, United Suppliers Finalize Merger
August 24, 2015
According to a press release on August 24, owners of United Suppliers, Inc. and members of Land O’Lakes, Inc. “have Read More
West Central Cooperative, Jefferson, IA
CropLife 100Iowa Cooperatives To Explore Unification
August 19, 2015
The boards of directors at two of Iowa’s leading farmer-owned cooperatives yesterday signed a letter of intent to study the Read More
CropLife 100Southern States Coop Hosting Drone Flight This Friday
August 3, 2015
Southern States Cooperative — No. 9 on the CropLife 100 — is hosting an FAA-approved drone demonstration at Grandview Farms Read More
CropLife 100Aligned Ag Distributors Adds Four New Owners
July 30, 2015
Aligned Ag Distributors LLC has announced the addition of four new customer/owners to Franklin Holding Co. LLC. They are: The Read More
CropLife 100Pinnacle Purchases California-Based Specialty Crops Retailer
July 20, 2015
Pinnacle Agriculture Holdings has successfully acquired California-based NH3 Service Co.  Operating as part of Pinnacle’s Performance Agriculture brand, the new locations Read More
Latest News
Dupont Pioneer
Crop InputsIs A DuPont-Pioneer Split On The Horizon Following CEO&…
October 7, 2015
The abrupt departure of the top executive at chemical and seed giant DuPont has reignited the debate over whether the Read More
DTS10 Sprayer Hagie
SprayersHagie Introduces 2016 DTS10 Self-Propelled Sprayer
October 6, 2015
Hagie Mfg. has introduced to the market the newest and most innovative member of its product family, the 2016 DTS10. Read More
Industry NewsSimplot, Agrium Execs Added To TFI Board
October 6, 2015
The Fertilizer Institute (TFI) announced the election of Garrett Lofto, president of the agribusiness group at J.R. Simplot Co., to Read More
Corn Field
Management‘Land Grabbing’ Grows As Agricultural Resou…
October 6, 2015
Since 2000, more than 36 million hectares — an area about the size of Japan — has been purchased or Read More
Mahindra Implement
Industry NewsMahindra USA Expands West Coast Presence
October 6, 2015
To meet the growing demand for Mahindra products,  Mahindra USA is expanding its West Coast facility with the opening of Read More
Corn Stover Stubble
Crop InputsNew Microbial Product Unlocks Nutrients, Reduces Costly…
October 6, 2015
Trash, stover, residue — regardless of the term, postharvest debris is increasing and causing more frustration and detriment to overall soil Read More
Precision AgPurdue Releases 2015 Precision Ag Services Dealership S…
October 5, 2015
In the spring of 2015, CropLife magazine and the Departments of Agricultural Economics and Agronomy at Purdue University conducted the Read More
Monsanto Sign
Eric SfiligojMonsanto And Syngenta: Stonewall Street
October 5, 2015
Recently, I was taking part in an industry-related golf tournament and happened to find a lost golf ball sporting a Read More
Greg Musson, Gar Tootelian
StewardshipGar Tootelian, Inc.: Making A Difference In ‘The Valle…
October 5, 2015
For the Environmental Respect Awards program, sponsored by DuPont Crop Protection with assistance from CropLife® and FCI magazines, the Ambassador Read More
Fiberglass Tank Workers at Precision Tank & Equipment
EquipmentPrecision Tank & Equipment: 50 Years Of Growing
October 4, 2015
Looking out onto the production floor of the fiberglass/stainless steel tank manufacturing facility in Ligonier, IN, David Hemming, president/CEO for Read More
Syngenta Sign
Crop InputsScience & Strategy Spur Syngenta’s Crop Protection …
October 3, 2015
Developing a crop protection portfolio is a lot of science and a little serendipity. “There are a number of things Read More
Dan Schaefer and Jason Solberg IFCA
StewardshipIllinois Fertilizer & Chemical Association: Tacklin…
October 2, 2015
You’ve got to be doing something right if lots of people keep coming to you for advice. That’s what’s happening Read More
LegislationFall Fertilizer Transportation Could Be At Risk With Po…
October 1, 2015
Failure by Congress to extend the deadline for the implementation of Positive Train Control (PTC) on the railroads could gridlock Read More
Weed ResistancePPO Resistant Pigweed Hits The Mid-South
October 1, 2015
If you’re a soybean grower already entangled in troublesome weed resistance in the state of Arkansas, Mississippi or Tennessee, you Read More
Weed ResistanceManagement Strategies That Worked In 2015
October 1, 2015
For better or worse, throughout many regions of the country 2015 provided the optimal growing season conditions for both crops, Read More
ManagementAn Update On CropLife America’s Meeting & The Outlo…
October 1, 2015
Editors Paul Schrimpf and Eric Sfiligoj review last week’s CropLife America Annual Meeting and how crop protection companies believe next Read More
Patriot 4440 Sprayer close up
Weed ResistanceManaging Herbicide-Resistant Weeds: The Importance Of ‘…
October 1, 2015
As the problem of herbicide-resistant weeds has spread, crop protection product suppliers have charged their top researchers with coming up Read More
Adjuvants loading
Weed ResistanceAdjuvants Trending Up For Fighting Weed Resistance
October 1, 2015
Gone with the wind are the days when adding an adjuvant to the spray tank was looked at with major Read More