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Rising Ethanol Demand Can Push Food Prices Higher - Rising demand for ethanol is expected to make corn-based foods dearer in near future. But the hike is not believed to put pressure on consumers’ pocket
Rising Ethanol Demand Can Push Food Prices Higher

 

PRZOOM - /newswire/ - Delhi, New Delhi, India, 2007/03/22 - Rising demand for ethanol is expected to make corn-based foods dearer in near future. But the hike is not believed to put pressure on consumers’ pocket.

   
 
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Rising ethanol demand is likely to take the prices of products, from broiler chicken to soft drinks, at grocery stores northwards. However, the change in prices may be too small for customers to notice.

The period from August 2006 to January 2007 saw the value of corn grain becoming double due to the surge in production of more corn-based ethanol. Consequently, high cost was suffered by foods that has corn as an ingredient or depend on it as animal feed.

Products that are facing price hike include processed foods like ketchup (produced from high-fructose corn syrup), soft drinks, corn-based food items, like breakfast cereal, and corn chips, and wheat flour and soybean oil. But the largest price hike is expected to be seen by dairy and meet items because manufacturers are being compelled to pay much higher for corn-based feed.

Robert Wisner, Agriculture Economist, Iowa State University, said in statement reported by The Mercury News on Feb. 26, 2007, “We've seen a little of the retail food price impact already”. He projected that the consumer prices would rise gradually over the coming few years as the ethanol industry would raise its capacity to more than double.

In January 2007, the US Department of Agriculture predicted that if corn prices increase by $1 per bushel, then grocery customers would see the pork prices increase by around 3% within few years.

According to the RNCOS report “US Biotech Market Analysis”, with energy crunch and zoom in prices of gas that brewed in US in some past years, interest in the production of alternative fuels like ethanol increased dramatically. American cultivators improved the corn production by 39 billion pound in the first decade of plant biotech-derived crops. This increased production is equal to 1.9 billion gallon of ethanol.

The market research report highlights the key issues and facts for today’s global business environment, like impact of biotechnology on biofuel production, and factors driving the growth in the industry. The report also satisfies the queries regarding US biotech industry and provides a thorough understanding on industry performance, bio medical, agriculture biotechnology, and clinical trials. For investors, a complete account on M&A activity in the industry, biotech funding, and government initiatives and regulations is given.

About RNCOS

RNCOS, incorporated in the year 2002, is an industry research firm. It has a team of industry experts who analyze data collected from credible sources. They provide industry insights and analysis that helps corporations to take timely and accurate business decision in today's globally competitive environment.

 
 
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Rising Ethanol Demand Can Push Food Prices Higher

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