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north central iowa | I would respectfully disagree. While a producer can manage future cost of production on a limited level, one can sell at a fixed level. The market is not spending that much time preoccupied with what it costs us to grow a crop. That particular function is centered around acreage shifts, and crop rotations. In my view the trade is involved with supply and demand calculations along with capitol inflows from major traders. I think the individual producer is always trying to grow us much as he can every year and not "lowering" his production to reflect cost of production. The marginal crop areas might go in or out of production, but the bulk of the corn belt will always be planted with high yield expectations. 12 billion bushel crops are a result of good farmers, good equipment, good weather, good genetics, and less a result of what it cost to do it. | |
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