Corn Prices Affecting Producers, Not Consumers

December 22, 2006 - Agriculture Secretary Mike Johanns says that while meat producers are being clobbered by record corn prices, the consumer is unlikely to see a direct impact.

"There's just too many factors that can impact the price, both up and down," he told the Associated Press.

Demand for corn from ethanol producers and the export market has pushed the price of corn to more than $3 a bushel after several years of near-record low prices brought on by bumper crops.

Dale Durchholz, a grain and livestock analyst for AgriVisor Services Inc., Bloomington, Ill., told Meatingplace.com that while the impact on consumers may be indirect, it will be very real. "At some point, the consumer is going to feel the squeeze," he said.

The poultry industry is already seeing profits evaporate and is passing some of its increased feed costs along to the consumer and Durchholz believes that by early next year corn will rise in price again, resulting in "lower overall meat output," which will result in higher prices for consumers.

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