United States agriculture has been faced with surplus-producing capacity for several decades. The tendency of excess production to push upon demand and to result in low returns to agricultural resources began in the 1920's. In the 1930's, agricultural programs began to provide a highly elastic demand through price supports and government storage. Stocks of wheat and feed grains that accumulated under these programs, however, became unacceptably large. Acreage allotments and other supply-control measures were only partially successful.
The ability of American agriculture to produce more than the domestic market will absorb at prices favorable to agriculture (with the criterion of "favorable" being resource returns comparable to other major sectors of the economy) is predicted to continue for the next 1 or 2 decades. Studies treating the aggregate of United States agriculture indicate that between 35 million and 100 million surplus acres would have to be held out of production to bring surpluses under control by 1965.3
Butcher, Walter R.; Heady, Earl O.; and Rigler, Larry G.
"The conservation reserve in south-central Iowa,"
Research Bulletin (Iowa Agriculture and Home Economics Experiment Station): Vol. 35
, Article 1.
Available at: https://lib.dr.iastate.edu/researchbulletin/vol35/iss525/1