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VisualMod t1_ja4gg3b wrote

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VisualMod t1_ja4ggnr wrote

>Yes, the market always looks ahead. This is good news for farmers and food producers, as it will lower their costs and increase their profits. In time, this will also lead to lower prices for consumers.

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iPigman t1_ja4gu29 wrote

Farmers will still bitch about high prices.

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CaptainCrypto1969 t1_ja4gvry wrote

I thought we were heading for a recession? Which means increase prices at the supermarket

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JohnnyFnCliche t1_ja4hi8s wrote

We covered this in another thread a week or two ago...farmers pre-bought fertilizer for 2yrs worth last year, so demand dropped this year...

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-Face_McShooty t1_ja4ix2k wrote

That's not how this works. Companies use high prices as excuses to raise prices. They rarely bring them back down when they can charge the same and make more profit until enough people complain.

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Unknownirish t1_ja4o38m wrote

If it'll affect the consumer prices. If people continue buying like they do, why would companies slash prices? Though Walmart would likely 😆

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rickert1337 OP t1_ja4qmgj wrote

Replying to JohnnyFnCliche (#2,032,842)

American farmers? Can u link source? That just means those will have a hard time in the future against those that didnt.. its a risk to do that.. and if prices stay low that will mean the risk they took didnt pay off.. u cant say that prices will stay high because some farmers bought 2 yr worth of fertilizer.. then stores will buy from farmers that didnt.. ofc some will have contracts but then people will go to a store that does not. Its how the world works

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link_dead t1_ja4u9n9 wrote

The reason the price is going down is the giant shit that the Fed have taken on the economy.

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reditor75 t1_ja4ulf1 wrote

Nope, more profits in the future img

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JohnnyFnCliche t1_ja4wy4b wrote

Replying to dscg24 (#2,035,126)

I'm going back through my notifications and can't find the thread...OP posted a DD about some powder or chemical that's used in fertilizer if I remember right, and some farmers chimed in saying they all bought 2 yrs worth last year because prices had been spiking...

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ImNoAlbertFeinstein t1_ja4xuxa wrote

Replying to JohnnyFnCliche (#2,032,842)

farmers often lock in production inputs at some favorable price at for future delivery, in order to secure their production loans.

edit. Ag were prob the creators of the futures market bc of the seasonality of crop production. futes have been around long before the tulip crisis. the very first cash mkt soon had a futes mkt next door prob.

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ruphustea t1_ja4y22k wrote

Some farmers found out that they can now skip the nitrogen on the beans at least once bc it was too high and they went without last year. Yields still respectable considering the cost savings.

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crazysal t1_ja4zbfn wrote

Inflation still spiking. There is 0% chance of a soft landing

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nestpasfacile t1_ja5imm4 wrote

Replying to rickert1337 (#2,034,346)

In a purely theoretical and idealized vision of capitalism sure.

We live in reality though where the rich have captured pretty much all industry and very much do collude to keep prices high. Why compete when you can make more money not competing.

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jojoyahoo t1_ja5jm36 wrote

Replying to JohnnyFnCliche (#2,032,842)

That only explains a small portion of it. It's not like all farmers in the world hold hands and lock in potash and ammonia futures at the same price on the same day.

These contracts are constantly being bought, delivered, and sold, so while it lags the spot rate, it's not unrelated.

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SnooDonkeys1685 t1_ja5p6g0 wrote

Replying to Burnit0ut (#2,035,129)

Maby in the processing and packaging part of food industry but at the farm level. Farmers are price takers and pay the shipping both ways meaning they pay the shipping for the products they need and pay the shipping for the products they sell. Look at the beef industry. There are four major packers and they control how mutch they pay by being able to buy imports and label them a product of the USA and charge whatever the market will stand without reducing demand to mutch. The beef packers record profits. Beef producers not so much.

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suazb95 t1_ja6rx1s wrote

I do think we are on the way to one. The economic data is somewhat confirming of the possibility.

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lightwhite t1_ja6ykfd wrote

Is it low because the poor countries went bankrupt and can’t even buy fertilizers anymore? Pakistan can’t even print more money to buy dollars for settling trades, I heard.

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tinfoilhat113 t1_ja7pusk wrote

Replying to ruphustea (#2,035,874)

Usually no nitrogen is applied on soybeans except what is in MAP or DAP fertilizer that whichever is a small amount. The only time I know you would put N on soybeans is if you were going for very high yield like to win a contest. Beans are a legume. Farmers certainly skipped dry map application when it is expensive.

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Johnny-infinity t1_ja7sync wrote

The party has only just started. People haven't started defaulting on debts yet.

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