With record corn production forecast this year comes lower corn prices, which makes the food versus fuel argument harder than ever to make, according to Growth Energy.
Total corn production is now projected at 14.475 billion bushels, 550 million bushels more than last year’s record, while the average price received by farmers is expected to be $3.40 per bushel, the lowest price in eight years.
Meanwhile, the United Nations Food and Agriculture Organization (FAO) reports the international food price index is down 6.0 percent over the last year, grain prices are down nearly 9 percent since 2013, but meat prices are nearly 22 percent higher than a year ago.
Domestic food prices are up 2.5 percent compared to December 2013, nearly the same as the overall Consumer Price Index, which is up 2.1 percent for the same period. But while corn and other grain prices are rapidly declining, consumer meat prices are up 11.6 percent since last December.
“The current WASDE projections and recent reports from the FAO and Bureau of Labor Statistics further confirm that there is virtually no correlation between U.S. ethanol production and consumer food prices,” said Tom Buis, CEO of Growth Energy. “Corn prices are below the cost of production for most farmers, and ethanol is selling approximately $1.00 per gallon less than the gasoline on the wholesale marketplace.”
“As integrated livestock and poultry companies brag about their record profits and margins to their stockholders and investment bankers, the Turkey Federation, National Chicken Council and The National Council of Chain Restaurants, all allies of Big Oil, continue their campaign to intentionally mislead Americans about the cause of rising food prices in the U.S,” Buis added.