Seeds and fertilizers make up 62% of the operating costs to produce corn and 51% of the operating costs to produce soybeans, according to U.S. Department of Agriculture data.
Innovations with seeds have helped drive a nearly three-fold increase in agricultural output since the 1940s. At the same time, land and labor costs have declined, according to USDA data.
“Biological, mechanical, chemical, and organizational innovations from both public and private sector investments in research and development have largely driven this productivity growth,” according to a report from USDA.
After a series of mergers, there are now only a handful of companies that control the chemical and seed industry: Bayer, Corteva, Syngenta and Limagrain.
The USDA report said “the largest four sellers of corn seed accounted for 85 percent of U.S. corn seed sales in 2015” while soybean sales from the largest four sellers made up 76 percent.
Note: Operating costs do not include indirect costs such as labor, opportunity cost of land, taxes and insurance.