Commodity prices have always moved in cycles. They always will. The farmers who prosper are not those who try to time the market — they are those who build a business resilient enough to endure the valleys and wise enough to use the peaks.
With tensions in the Middle East once again making headlines, we are already hearing excited talk in the agricultural community about the prospect of rising commodity prices. Disruptions to global trade routes, energy costs, and fertiliser supplies have historically pushed grain and oilseed prices higher — and it is natural to feel a degree of optimism when the charts start pointing upward.
But at Siggs & Co, we urge a clear head. A look at thirty years of IMF commodity price data tells a story that should give every farmer pause before making major decisions based on short-term market sentiment.
Thirty Years of Price Cycles
The chart below, compiled from IMF data spanning 1995 to early 2026, tells the story plainly. Whether you look at rapeseed oil, soybean meal, wheat, beef, or milk, the pattern is the same: prices surge, then fall back. The dramatic spike in rapeseed oil approaching £2,400/tonne in 2022 was extraordinary — but within two years prices had retreated to around £1,000/tonne. Wheat followed a near-identical arc, touching £400/tonne before retreating sharply. Even beef, the steadiest riser of the group, has not moved in a straight line.
Source: IMF Primary Commodity Price System, February 2026
The 2007–08 food price crisis, the post-Covid supply shock of 2021–22, and now the Iran-related uncertainty of 2026 are all points on the same long-term roller coaster. Each time, the cycle eventually corrects. Producers who borrowed heavily or over-expanded on the assumption that high prices were permanent found themselves in serious difficulty when the tide turned.
The farmers who prosper over decades are not the ones who guessed right on the next spike. They are the ones who built a business that could survive the next trough.
Our Advice: Four Principles for Long-Term Resilience
Rather than reacting to today’s headlines, we encourage every farming business to return to fundamentals. Here are the four principles we believe underpin lasting agricultural success:
01
Stick to Your Long-Term Strategy
A sound farm business plan is built for the long run — not for the current news cycle. Resist the temptation to make structural changes based on price spikes that may be short-lived. Your cropping rotation, livestock system, and infrastructure decisions should be driven by your strengths and your land, not by a volatile spot price.
02
Control Your Cost of Production
In a period of high prices, it is easy to let costs creep up. Input suppliers know when margins are fat, and costs — particularly for fertilisers, fuel, and contracting — tend to rise in lockstep with output values. The farmer who obsessively manages cost of production per unit is the one who remains profitable across the full cycle.
03
Keep Borrowing Conservative
Debt taken on during a price peak can become crippling when values fall. Rising interest rates have sharpened this risk considerably. We strongly advise against stretching borrowing on the assumption that today’s prices represent a new floor. Maintain headroom in your finances for the inevitable downturn.
04
Use Windfalls Wisely
Periods of exceptional prices are an opportunity — but only if managed carefully. Use windfall income to reduce debt, invest in efficiency improvements that permanently lower your cost base, and build cash reserves. Equally important: use high-income years to fund a pension. Agricultural incomes are highly variable; a pension provides the financial foundation that land alone cannot guarantee.
A Word on the Current Situation
The situation in Iran and its potential impact on shipping lanes, energy prices, and global food supply chains is real and should be monitored closely. Rapeseed and sunflower oil markets in particular are sensitive to Black Sea and Middle East disruption. If you are positioned to benefit from a price rise — through stored grain, forward sales yet to complete, or uncommitted growing area — then by all means keep a close eye on the market.
But do not let optimism drive decision-making. The thirty-year chart does not show a commodity market that has fundamentally reset to a higher level. It shows a market that moves in waves. The wave may well come. It will also recede.
At Siggs & Co, we are here to help you make the most of the good times — and to ensure your business is well-positioned to weather whatever comes next. If you would like to review your financial position, cost of production benchmarks, or long-term strategy in light of current market conditions, please do not hesitate to get in touch.