Gold Rush: More than 90 million acres of corn will be planted this spring
The U.S. Department of Agriculture says the largest corn crop in 63 years is on the horizon as farmers cash in on the ethanol gold rush. Estimates indicate more than 90 million acres will be planted with corn this spring. Experts say corn is selling above production cost for the first time in 30 years, and farmers are reacting with record planting. In fact, prices have more than doubled since last August, and the total windfall could be $50 billion. With a successful harvest, farmers will reap 12.5 billion bushels this autumn. That's 700 million more than the 2004 record. On the flip side, other crops such as soybean, rice and cotton will decline. With the increased corn supply and about 80 biofuel refineries going on line, ethanol production is expected to jump from 5.6 billion gallons to 8 billion this year.
[Source: Richard Luscombe & Jacqui Goddard / scotsman.com]
Reader Comments (Page 1 of 1)
Tony Belding 12:03PM (3/31/2007)
Two thoughts strike me. . . First, has corn really been selling for under its production cost for 30 years? Does that mean the only thing propping up corn production until now was government subsidies?
Secondly. . . As long as fuel prices are driving corn to sell above above production cost, it would seem to undermine the old argument that corn takes more petroleum to grow than it displaces when made into ethanol. I wouldn't imagine there could be any profit if that were the case.
Reply
Rick 1:31PM (3/31/2007)
The liberals here don't believe in the laws of supply and demand. Guess what? When the price goes up, the supply rises to fill it. The most telling fact is that they only got back to acreage levels planted in 1944!!!
Wait until the "setaside" acreage starts to come off. Those are acres that the gov't has been paying farmers to NOT PRODUCE. There are 30 million setaside acres out there now. Those costs are part of the "subsidy" you keep hearing about for corn farmers!
This is happening worldwide, creating jobs, opportunity and prosperity for agribusinessmen everywhere. It doesn't take food out of the system, it adds to it. Those are crybaby arguments by people who don't understand economics 101. Let the laws of supply and demand work people.
Reply
Tim 10:41AM (4/02/2007)
Rick & Tony - Please keep in mind that "the government" never pays for ANYTHING! As taxpayers, you and I are forced to foot the bill like it or not.
Now it will be up to the next yet unborn generations to pay the debt thrust upon us all by pork, earmarks and outright vote purchasing carried on by both the Neo-conservatives (Neocons) and liberals in congress. The only difference between the democratic-socialist and Neocons is that they disagree on how to spend other people’s money.
Entitlements my butt!! I'm thinking rope, tar, feathers and a rail.....
Reply