Wednesday, July 20, 2011

food prices, says report Government support for ethanol has led to an increase in corn production and a steep rise in soybean imports


A growing number of US farmers are switching to crops such as corn in order to meet the demand for ethanol. Photograph: Charlie Neibergall/AP

Suzanne Goldenberg, US environment correspondent
Demand for biofuels in the US is driving this year's high food prices, a report has said. It predicts that food prices are unlikely to fall back down for another two years.
The report, produced by Purdue University economists for the Farm Foundation policy organisation, said US government support for ethanol, including subsidies, had fuelled strong demand for corn over the last five years.
A dramatic rise in Chinese imports of soybeans was also putting pressure on prices and supply, the report said.

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