The Times They Are A-Changin’

The potato market’s new reality

Published in the April 2014 Issue Published online: Apr 20, 2014 Jerry P. Wright

Dr. Jesse AusubelNot that long ago singer-songwriter Bob Dylan wrote and performed the hit song “The Times They Are A-Changin’.” Dylan was 23 years old when he composed this now famous ballad. At that tender age, Dylan supposed, as most of us do, that history began at the moment of his birth, and that, when he woke up at 23 and looked out the window, the constant world of his childhood was no longer—times were a-changin’. What Dylan did not know then and what all of us come to acknowledge as we wade into history, is that time has always been “a-changin’.” But today, unlike in 1964, times are not only a-changin’, they’re a-changin’ faster than ever before. Regarding agriculture, nothing was ever more applicable than the rapidity with which the times are changing, and no one knows this better than a member of the United Potato Growers of America.

Growers who attended the Potato Business Summit in San Antonio this January had their view of the potato category validated by Dr. Jesse Ausubel of New York’s Rockefeller University. What has been true for potatoes for decades is now being felt globally in most major food categories. Namely, when constantly increasing production collides with leveling or falling consumption, the result is market chaos. Yes, Bob Dylan was right in 1964, and he is still right: “The times they are a-changin’.”

The single market force that struck potato growers hardest when United first began examining potato-market statistics was that yields have been increasing at the rate of about five additional hundredweight of potatoes per acre per year for several decades, while consumer consumption has been declining for the same period, but at a somewhat lesser rate. The two—consistently increasing supply and consistently decreasing demand—were on a never-ending collision course, creating totally unmanageable market conditions year after year. Looking back, why did it take growers so long to come to this vital and seemingly obvious understanding?

The answer is that, until United was formed and charged with the responsibility of dissecting the potato market’s economic structure, no one had ever been given that specific assignment. Within a short span of time, a clear paradigm for stabilizing fresh-potato market price began to emerge. Since then it has been steadily refined, taught, and implemented. What today seems obvious—balancing supply with demand such that price stabilizes—did not exist at the time. But times were a-changin’, and United was changing them. The perpetual oversupply that had been raising havoc with price stability, the very issue that each year brought about numerous farm liquidation auctions, virtually terminating family fortunes, was coming to a close provided growers understood that it was their own drive to increase production that lay at the root of price instability.

Now, the world is awakening to the same reality that United discovered years ago, but is at a loss as to what the corrective measures might be. The decline in current global commodity prices suggests that this is so. The economic law of supply/demand/price is as immutable as the law of gravity. Those who understand this principle prosper from acknowledging its reality while those who don’t are punished by the same reality.

To every potato grower in North America, and any other place about the globe, I invite you to heed the potato market’s new economic paradigm, and profit thereby. Why not? A successful farmer should be able to afford trucks, tractors, center pivots, production inputs and an occasional vacation!

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