Farmers have been taking land out of production and slaughtering herds during the 2008-10 downturn. It takes a while to build them up again, but we have a lot of unused capacity in the long run. High prices will cause them to ramp up production, but you can’t grow a crop in a few weeks.
We currently have a huge oversupply of meat.
Successful Farmer, a trade magazine, just published a special marketing issue. It included an article titled "Boatloads of Meat" describing how critical meat exports are to the survival of American beef, pork and poultry production.
The Novemeber issue had an article describing how the enormous oversupply of hogs nearly bankrupted the entire American pork industry just this April, 2010. Everyone was within weeks of total destruction. Several of the largest didn't make it and are out of business for good.
Practically no one on FR understands just how huge and constant our food surpluses are.
See my tagline, it's a constant in the farming industry.
If you listen to farmers a lot of them are switching back to cotton. Compared to most vegetable crops cotton is much easier to grow, takes far fewer inputs and labor and at these prices you can make it work.
We weren’t going to grow wheat this year but they offered us a contract we couldn’t refuse and even then we are only contracting and growing 50% of what we have grown previously.
We are still going to grow the vegetables but there have been a few contracts turned back and those contracts are hard to get.
On the news last night, somewhere they were taking several hundred acres of farm land (corn) and turning it into a solar panel “farm.” It didn’t even look like they had brought in the corn because it was all thrashed and laying in the soil. Talk about wasteful. Now, I’m no rocket scientist, but how is making a solar farm on the ground beneficial? Why not put the panels on top of the buildings that will be using solar power instead of taking up valuable farm land?