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To: Wonder Warthog
You obviously missed the point of the hugely increased production between 1995 and 2007.

No, I obviously didn't. My fact is a fact independent of that additional information.

If you increase the demand (and cost) for an item, it will put upward price pressure on substitute products. When you reduce the supply of a commodity, by shifting into some other use, you increase the price.

I never contended that this fact was the only influence on prices of corn. And obviously a shift to ethanol is not the only influence on the supply of corn for food. But moving a percentage of corn from the food supply to energy production decreases the availability of corn for food, and increases the price for corn and substitute items proportionally.

That is a fact. It's effect can be aggravated or mitigated by other factors that affect supply, such as an increase in production. Obviously.

18 posted on 05/14/2008 5:51:35 AM PDT by dead (I've got my eye out for Mullah Omar.)
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To: dead
"But moving a percentage of corn from the food supply to energy production decreases the availability of corn for food, and increases the price for corn and substitute items proportionally."

Excuse me, but bullshit. Look at the numbers---the total amount of corn went UP hugely, even after the amount of corn used in ethanol production is subtracted out from total production. By the law of supply and demand, the price of CORN derived products should have gone DOWN based on the increased supply.

It may be true that there would be some increase in the price of wheat, rice, rye and sorghum products to the extent that acreage used for their production was "switched" to corn---but NOT for corn products, so the driver for the price increase in CORN products is NOT ethanol production AT ALL, but some other factor. My guess is increased fuel costs, speculation, and opportunistic price gouging.

26 posted on 05/14/2008 6:29:02 AM PDT by Wonder Warthog (The Hog of Steel-NRA)
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