Ethanol Boosts Corn Prices
Fri, 05/12/2006 - 3:30am
According to a report released today from the Agriculture Department, an increased demand for ethanol will push corn prices higher this year.The amount of corn used to make ethanol should increase by 34%, compared to last year’s to 2.15 billion bushels. Demand from ethanol plants as well as from foreign countries improved the price forecast to $2.25 to $2.65 a bushel, compared with last year's $1.95 to $2.05. Demand has risen so sharply, the amount of corn in storage is expected to drop to half of last year's levels, according to the Agriculture Department. Farmers should harvest 10.55 billion bushels of corn, a 5% drop from last year. Also in the report, soybean production is estimated to be 3.08 billion bushels, down 6 million bushels from last year. Soybeans can also be used as a renewable energy source.