Low prices cure low prices is a market adage that is often quoted.
This statement is rooted in the theory that low prices tend to discourage production and encourage consumption, which leads to tighter supplies and higher prices. Low prices encourage consumption but they do not, of their own, increase demand. In the past, there was often a supply response to low prices in the form of government acreage reduction programs. This government policy response has been eliminated from current legislation and low prices have not caused producers to reduce planted acreage. As long as supplies are large, prices will remain low to encourage consumption.