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Iowa Ag Review

Abstract

Bumper crops have quickly turned the corn and soybean price boom into a bust. Newcrop corn and soybean futures contracts are down 40 percent and 35 percent respectively in just a few short months. Of course, those farmers that had the foresight to lock in at high prices are completely unaffected by the drop in price. For them, market volatility has created profit opportunities. But all is not lost for the majority of farmers who did not lock in at those prices. The farm safety net created by the 2002 Farm Security and Rural Investment Act will cushion the financial shock of lower prices.