Drowning in grain: historically high supplies and low prices

A vehicle that I purchased roughly ten years ago has operated perfectly fine with half of its scheduled oil changes and very little other maintenance. From an engineering perspective I find that mind-blowing: you buy these machines and they operate flawlessly for years, running for thousands of miles, while performing a complex, mechanical task with many moving parts. It's easy to take for granted how marvelous modern automobiles have become.

* Increased mechanisation of farming -- direct muscle-power substitution.

* Increased fertiliser application -- removal of binding constraints on plant productivity (see Leibig's Law of the minimum).

* Increased pesticide application -- removal of parasite load and requirements for plant-provided parasite defence from production.

* Breeding for increased caloric yield -- given the reduced demands on non-food plant metabolic expenditure, more of that energy budget is channeled into high-yield varietals and cultivars. (Howard Odum has excellent discussion of pest/productivity dynamics in plant energy budgets.)

* Increased overall agricultural knowledge and management. Approaching the potential envelope by following maximally-effective practices. The ability to motivate large-scale activities quickly (e.g., harvest entire fields within days or hours of optimal state) factors into this.

There's also the fact that the energy substituted for human and animal inputs is subject to a natural capital draw-down understatement of 10^2 to 10^6 magnitude (and more likely the higher). Petroleum and natural gas prices (NG is the primary input to nitrogen fertiliser production) are grossly understated under current economic and accounting models.

For automobiles, the price reductions are less evident in large part because the starting point in the story occurs well into the inputs- and process-modification regime. If you extend the concept of "making cars" to "wagon construction and iron smelting" as of the 16th or 17th century, when wrought iron was fired by charcoal, not rock coal, you'd see fairly comparable efficiency gains. Metalurgy made tremendous leaps in the 19th century (Bessemer steel, 1860s, aluminium smelting, 1880s) as well, far in advance of generally affordable automobiles (1910s) and the explosion in automobile ownership (1950s, for the U.S., later elsewhere).

Robert J. Gordon notes that the rate of patent filings for both automobiles and aircraft peaked by the 1920s. Not that there hasn't been additional technical refinement, but the rate is markedly slower. (See The Rise and Fall of American Growth, 2016.)

Much automobile development has also gone into what I'd call technological "hygiene factors" -- addressing consequences of the initial concept development: safety, pollution, efficiency, and reliability. Another set of developments have gone into factors which influence surface appeal but do little for functional performance, call it bling. (Gordon also addresses, though IMO mis-attributes this factor.)

There are other factors. So long as automobiles are made of steel or aluminium, there's a fixed energy cost in their production (ore reduction, refining, and smelting). Until and unless the underlying materials are substituted, that will remain. Actual assembly is fairly straightforward, and Henry Ford had already done a great deal to optimise assembly-line methods. The increased use of robotics substitutes more for the control element of labour than the energy input (as was the case in ag), resulting in more precision and consistency (and enabling greater complexity -- the Jevons Paradox). The cost of actually programming automated assembly equipment has (at least until recently) rivalled the cost of the robotics themselves. "Cheaply programmable" had not been a feature.

Upshot: Farming as of 1920 offered far more opportunities for optimisation than automobile manufacture did. Automobile manufacturing saw additional, non-performance features added. Automation substituted for different factors than mechanisation. Corn and wheat don't demand cupholders, electric windows, in-vehicle entertainment, and self-parking systems.

This provides a price insurance for farmers. This year's price was set at: $3.96 per bushel for corn and $10.19 per bushel for soybeans (reference - http://www.wisfarmer.com/story/news/2017/03/08/corn-soybean-...)

So with the support prices, unless the yield prices goes below support, people will still grow corn.

As how does it affect Canada? For one, Canada will surely be having it's own insurance program. Second, It is a simple arbitrage play, if Canadian supply is cheaper people will buy cheap corn from there and import to US.

Curious what price level you would say is unprofitable to grow corn?

Because much of corn is turned into HFCS, which is so cheap it's added to everything, which is causing a huge spectrum of preventable diseases, such as metabolic dysfunction, which in turn is partly the cause of bankrupting national healthcare programs?

Who are these groups? Do you refer to the "Quiverfull" movement?

From your link: "The world produces enough food to feed everyone."

Further: "For the world as a whole, per capita food availability has risen from about 2220 kcal/person/day in the early 1960s to 2790 kcal/person/day in 2006-08, while developing countries even recorded a leap from 1850 kcal/person/day to over 2640 kcal/person/day."

Edit: the land would be planted to wheat if not planted to corn. Wheat uses approximately 80% of the N as corn. The land wouldn't sit idle.

They're kind of like a facts... or is it mobile link hate?