An Ol’ Broad’s Ramblings

March 9, 2007

Foolishness of Fools

Filed under: Economy, Environment — olbroad @ 9:57

Will Demand for Ethanol Raise Food Prices? The Government Says Yes

Strong demand for corn from ethanol plants is driving up the cost of livestock and will raise prices for beef, pork and chicken, the Agriculture Department said Friday.

Meat and poultry production will fall as producers face higher feed costs, the department said in its monthly crop report. Ethanol fuel, which is blended with gasoline, is consuming 20 percent of last year’s corn crop and is expected to gobble up more than 25 percent of this year’s crop.

The price of corn, the main feed for livestock, has driven the cost of feeding chickens up 40 percent, according to the National Chicken Council. The council says that chicken, the most popular meat with consumers, will soon cost more at the grocery store. The industry worries the competition from ethanol could cause a shortage of corn.

The price of fuel might go down a few cents so you can drive to the grocery store to find out you can’t afford to buy food once you get there. (Mr. Ol’ Broad)

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