Imperial Valley News

The Oct. 15 RFA report, “Will the Plunge in Grain Prices Mean Lower Food Prices at the Supermarket?” documents the significant decrease seen in the prices of farm commodities in the face of continually rising ethanol demand and retail food prices.

“The fact that ethanol production is expanding and food prices are also on the increase while we have seen a continual decrease in corn prices since July means only one thing,” said Bob Dickey, NCGA president. “And that is that those who have accused corn growers and ethanol producers of taking food from the hungry were completely wrong.”

Since their peaks earlier this year, corn futures have dropped nearly 50 percent, wheat more than 50 percent and soybeans approximately 45 percent, according the RFA report, based on Chicago Board of Trade pricing data as of Oct. 10.

These price drops took place even though the renewable fuels standard (RFS) was expanded in Nov. 2007 and a bid to have it reduced temporarily was rejected by the U.S. Environmental Protection Agency in August, Dickey noted.

“Ethanol opponents practically promised that reducing the RFS would ‘immediately’ bring down food prices because it was expected to lower corn prices,” he said. “However, we have yet to see this happen - even though corn prices are lower today than anyone imagined a few months ago.”