There is a solution. Eliminate the element of demand related to the inefficient use of corn as a motor fuel. Prices will decline.
Six weeks of rain have flooded untold acres of corn and soybean fields in the U.S. heartland, forcing farmers to abandon their crops and sending international food prices skyward. More bad weather is expected for Illinois, Indiana and Ohio on Thursday, forecasters say, meaning prices may could climb higher.
Corn for July delivery rose 5.75 cents to settle at $7.09 a bushel on the Chicago Board of Trade, after earlier rising to a new all-time high of $7.25 a bushel. It was corn's sixth straight trading record in as many days. Prices broke past the $7 barrier for the first time Wednesday.
Prices for the corn in the ground now jumped even higher. Corn for December delivery soared to a record $7.55 a bushel on the CBOT before falling back to settle at $7.395, still up 6.75 cents....
But corn's spike has raised questions as to how long demand will support the unprecedented price levels. Livestock owners will likely be forced to slaughter more cattle, hogs and chickens to cope with rocketing corn-based animal feed, and ethanol producers who use corn as their main feedstock will also suffer.
"This is a price level here where I don't see a sector that can afford it," Ward said. "The livestock sector cannot afford the corn at this price, the ethanol producer cannot afford it and the dairy producer cannot afford it."
6 years ago