Americans should brace for higher food prices this year now that demand for corn has pushed U.S. supplies to their lowest point in 15 years.
Higher projected orders from the ethanol industry sent corn futures soaring Wednesday, as corn supplies became the latest commodity to plummet. Low levels of wheat, coffee, soybeans and other food staples have already sent prices surging on the global market.
As those reserves decline, U.S. food companies are warning of retail price increases.
. . . The USDA report measures global supply and demand for grains, oilseeds and other crops. The department said its projections for wheat and soybean reserves remained unchanged at historically low levels.
The price of corn affects most food products in supermarkets. It’s used to feed the cattle, hogs and chickens that fill the meat aisle. It is the main ingredient in Cap’n Crunch and Doritos. Turned into corn syrup, it sweetens most soft drinks.
Voters are almost immediately responsive to higher food and gas prices.
In this case, prices will go up in response to administration policies encouraging the use of ethanol as fuel.
This could be another strike against Democrats going into 2012.