Today the price of corn is lower then the cost of production because there is no market for all of the corn produced.
Now corn prices will rise if there are markets for it, if not corn prices will go down and corn production will go down until the market price comes to a point that it is profitable to raise it. When this happens and if food production is the only use of corn, you will not like what happens.
It will be a true case of supply and demand.
Corn production in the USA in my lifetime has gone from and average of 35-50 bushels per acre to close to 200 average.
Any adjustments will have to come in number of acres planted.
If you want economically priced food you best hope for continued maximum production usage. It will not happen going the other way.
You give a great insight to corn prices as they relate to food prices. I did not take the time to look at it from the supply-demand perspective. Because of your post, I am on track.
There’s no market for all the corn because corn subsidy has led to malinvestment.
We don’t need and can’t use all that corn. However instead of backing off and letting the free market work: the Government has doubled down on the malinvestment and now forces people to buy corn in the form of ethanol.
Remove the subsidies and the ethanol mandates. Less corn will be grown, corn prices will rise to a free market level - and some of the land currently used to grow corn will be turned over to more productive use.
If ethanol made economic sense for fuel no one would have to mandate by law. It would simply be used because of the benefit.
That’s letting the market work.
By distorting the market there are wide spread and often unforeseen consequences and like drug addiction getting off of them has a cost in withdrawing but the longer you stay on it the worse the damage and the harder to get off of it.
seems to me Walt you’re defending a government perverting a market because they have already perverted it with this idiotic program.