Ethanol Mandates May Spike Food Prices, Economists Warn

Wednesday, March 24, 2010 - 12:35 in Mathematics & Economics

Consumers could soon be paying a lot more for meat, milk, eggs and other farm staples if bad weather withers a U.S. corn crop that is now tethered to grain-intensive renewable fuel mandates, a new University of Illinois study warns. A corn shortage, coupled with surging demand to meet government-ordered ethanol standards, could push cash prices to $7 a bushel, the study found, squeezing livestock producers and spiking grocery prices. The study warns that federal policymakers need to forge solutions now to cushion the blow of a shortfall that history shows is a matter of when and how severe, not if. read more

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