The Cost of Cheap Food

I have always been convinced that in agriculture we are our own worst enemies. We have this mindset of just doing our jobs, not worrying about what is said about us and working harder when times get tough. I agree that all of these are admirable qualities and the whole world would be better if everyone adhered to these ideas. However, we all know that is not the way of the world and something that happened last week just reinforced that for me.

Last week I came across an article comparing the price of corn in August of 2018 and the price of corn in August of 1974. Guess what? They were the same. The idea that we are getting the same price for our product that we did forty-four years ago is hard for me to get my mind around. I found this so appalling that I posted it on my Facebook page. Yes, I know social media is a double-edged sword and by sharing it I was opening myself up. That thought never crossed my mind, I thought I was revealing some great injustice.

For the most part, my post was seen as I had hoped. Most of my friends were acceptably outraged and many reposted it with comments about how wrong it was. Then one of my friends made a remark about how our production had gone from around seventy bushels per acre to one hundred and seventy and there was our profit.

I have to admit, at first I really didn’t think much of his remark, other than I had not expected that kind of reaction. That day I could not get it out of my mind, we were in corn harvest and I promise you that the yields this year were closer or even below the 1974 yields and no where near the modern expected yield. Maybe that is what made the comment hit so close to home.

More likely it was the idea that because we could produce more corn on the same acreage that we should not expect more for each bushel. Did that mean if GM is producing the same number of cars they should also be pricing them at a 1974 level. I hope so. My guess is that GM would tell you that with the increases in technology we now have a safer, more economic and much more modern car to drive. So why is it not that way in agriculture. Why, because our consumer has been spoiled by the low cost of food. They think nothing of paying thousands of dollars for the newest shiniest anything but if the cost of food goes up a few pennies it is too much.

My response to my friend was that we have gotten much better at producing the food we all rely on, but that comes at a price also. The price of the seed corn itself has gone up dramatically during that time. We are paying for the technology that allows us to produce more but unlike many other things, we cannot recoup that increase in price. The technology of producing the crop has increased dramatically in the last forty plus years and with that comes a hefty price that we are expected to absorb.

The increased cost of technology does not take into account the increases in other costs like fuel and oil, tires, taxes (I will guarantee we are paying more taxes), the cost of parts, the list goes on and on. I defy you to find a cost that is lower than it was in 1974. We all know how the price of land and rental rates have gone up much more during this time period. Sure we get a lot more bushels per acre, if mother nature cooperates but those bushels cost us significantly more than they did forty years ago.

The ability to take prices for our products that are the same as they were forty four years ago while paying for our inputs at current prices is amazing. I dare you to name another sector of our economy that could or would do that. In agriculture we take the prices we are given and consider ourselves lucky to get that much. Farmers and ranchers are the most self-less people I know. When we are thrown obstacles we take on the challenge and put our shoulders to the grindstone. We would never think of complaining or defending ourselves.

We are so blessed in this country to have a food supply that is so abundant and affordable that consumers take us for granted. What other industry would a consumer say that they should be happy with 1974 price levels because they are more efficient and productive. None other than agriculture. I am proud to be part of such a great industry but we need to start educating our consumers about our situation. Everyone who drives a car, wears clothes and eats is dependent on agriculture and our survival. Last time I checked that was everyone I knew, and after all, nothing is as expensive as cheap food when it is gone.