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While shoppers battle with the cost of food at the check-out, farmers around the world are expected to plant fewer crops this year, largely because the cost of growing some produce is higher than its potential value.
Global wheat and corn prices have halved since record peaks in 2022, but the cost of essential inputs such as fertiliser remain historically high, creating a squeeze on farm profit margins and making some crops unviable to grow.
Commonwealth Bank sustainable and agricultural economics associate director Dennis Voznesenski said there was a noticeable shift in North and South America, where farmers were expected to trim back crop planting plans, beginning in less productive areas.
Farmers in Brazil — one of the world's biggest exporters of animal feed corn — are expected to plant seven per cent less export quality corn this year than last year.
"They're saying it's less profitable, it doesn't make sense to plant as much," Mr Voznesenski said.
Similarly in the US, total winter crop plantings are expected to be down two per cent compared to last year.
"The difference between an abundant year and lean a year is only a few per cent. Globally while we do produce a lot, there's also billions of people who need the food," he said.
"Whenever there is a slight hiccup, especially in a large producing nation and they see a decline in crop production, the world still needs to get that from somewhere."
He said wheat plantings in the northern hemisphere later this year may also be reduced.
Mr Voznesenski pointed to the global bellwether for wheat and corn prices, the Chicago Board of Trade, where values had halved since a high set in 2022 when Russia invaded Ukraine.
"Now they're actually trading slightly below the ten-year average, whereas farm input costs, they've declined from the highs, but they are still significantly above average," he said.
The upside for Australian farmers is a potential lift in grain prices in 2025 due to subsequent falling global grain stocks.
"We're used to reading articles where one big thing happens when suddenly prices start to rise, but in reality it's usually a number of factors that compound one on top of the other and eventually we see rapidly rising prices," Mr Voznesenski said.
"So we are seeing likely issues with Canada's crop, we may see reduced plantings next year, we could see lower yield in Russia [and] Western Australia is dry.
"On the demand side, we may see interest rates fall and demand increase as a result, just one of those factors after another eventually tips a scale and we see high prices, but it takes time."
At Coorow in Western Australia's Mid West, farmers like Michael O'Callaghan are dry seeding their winter grain crops.
But they are anxious, as the region had its second driest year since 1900 last year.
Based on the weather forecast and the cost of production, Mr O'Callaghan is considering scaling back his seeding program.
"There's a lot riding on this year, last year was such a big financial hit for nearly every farmer in this area, trying to get [planting] decisions right is crucial," he said.
"All costs have gone up from five or six years ago, fertiliser is still 40 per cent more than it was then, [and] chemicals would be the same level."
Mr O'Callaghan said insurance had also gone up by more than 300 per cent in the same time frame and machinery maintenance costs were also high.
"Personally, our insurance has gone up 25 per cent in one year," he said.
"The cost of labour and parts from machinery dealers, the parts are seriously out of control ... these costs don't come down."
Stories from farms and country towns across Australia, delivered each Friday.