Final answer:
A decline in demand for ethanol, which is made from corn, will generally lead to an increase in the demand for soybeans, as farmers look to plant more profitable crops. However, other factors such as weather and climate, as well as the convergence of wheat and corn prices, also affect farmers' crop selection decisions.
Step-by-step explanation:
Ethanol demand influences crop selection and agricultural economics. When ethanol, made from corn, sees a decline in demand, farmers may shift acreage from corn to alternative crops like soybeans to maximize their profits. Given that both crops can be grown on the same land, a decrease in demand for corn generally increases the demand for soybeans as farmers seek to plant crops that could offer better returns. Conversely, factors such as weather and climate conditions (for example, the severe drought in the Manchurian Plain affecting wheat, corn, and soybean supply), can also play a significant role in influencing the cost of production and supply of these agricultural products. Additionally, wheat and corn price convergence, as mentioned by Erik Younggren, reflects the complexity of agricultural decisions and markets. Farmers constantly adjust their planting decisions based on a combination of market signals, natural conditions, and economic viability.