Study: Corn Prices Have Little to No Effect on Food Prices, NCGA Says (3-27-07)

The recent increase in corn prices is unlikely to have significant effects on consumer food prices, according to a report released today by the National Corn Growers Association (NCGA).

This report summarizes key results of a private study conducted for NCGA by Advanced Economic Solutions and also offers analysis based on information from a variety of other sources, such as the U.S. Department of Agriculture (USDA) and Bureau of Labor Statistics (BLS).

According to the report, if current corn prices recede back to historical levels because of a significant increase in production this year, there would be little or no impact on consumer food prices. The paper concludes that if corn prices remain at the $3.50-4 per bushel range for several years, consumers might experience marginal food inflation for some grocery items.

The full report, “UNDERSTANDING THE IMPACT OF HIGHER CORN PRICES ON CONSUMER FOOD PRICES,” is available here.