Why did grain prices fall in 2008? Draw a graph to show the short-run effect on an individual farmer’s economic profit.

Big drops in prices for crops make it tough down on the farm Corn, soybean, and wheat prices have fallen roughly 50 percent from the historic highs of earlier this year. With better-than-expected crop yields, world grain production will rise nearly 5 percent this year. Grain prices have also become more closely tied to oil prices because of the growing corn-based ethanol industry.