Corn - The New Gold Standard?

[Michael in FtW]

I was watching the farm market report this morning and was shocked to learn that the price of corn has doubled in the past 3-4 months. As the price of crude oil has gone up to over $70 a barrel, and alternative renewable fuel sources are beginning to be taken seriously (like Ethanol from corn) - the demand for corn for other than as a source of food is driving the prices up!

Cattle (beef) are finished off in a feed lot to fatten up on corn - with the price of corn doubling the price of beef is probably going to increase anywhere from $0.50-$1.00 per pound in the next few months.

But, the biggest price increases per pound will probably be in pork, fowl (chickens, turkeys, geese, ducks) and farm-raised fresh water fish like trout and catfish. Unlike cattle which can be grazed on grass for a little longer - these are not grass grazers - the are corn fed!

I doubt that government subsidies will increase enough to keep the price down in light of the new demand for creating alternative fuels rises.

Anyway - if you notice prices going up at faster than normal inflation rates on these items over the next few months or year ... you'll know why.

[mudbug]

also affecting the price of tortillas in Mexico, Michael. read about it in the business section on Sunday.

[Uncle Bob]

Great post Michael!! Excellent content!!

A neighbor of mine related to me the other day that several local farmers "booked" this year's corn crop back in September for I think he said $1.00 per bushel over market price with a new ethanol facility openiing soon in Vicksburg. Sounded lke a great deat at the time...However it seems now market price is over the "deal" price..so they are cryin in their beer.

Edit: Think I'll stock up on bourbon as it's at least 51% corn.

[bethzaring]

Thanks for the information. It is good to understand the effect the rising price of corn will have on other foods you may not associate with corn.

Excuse me while I go work on my garden seed order........