Tightening ratios between organic and conventional commodity prices have introduced new supply risks for organic markets and will decrease domestic production if the trend continues.
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- Organic-to-conventional ratios for organic corn and soybeans have tightened over the past few years, which has threatened the financial situation of producers.
- In the short term, organic farmers have been shifting acres into alfalfa and considering selling into conventional markets to deal with the low premiums.
- In the longer term, tightening organic premiums would push some farmers out of organic production while discouraging further expansion.
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