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USDA: Corn supplies jump, easing shortage worries

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http://finance.yahoo.com/news/USDA-Corn-supplies-jump-apf-4141322331.html?x=0

USDA: Corn supplies jump, easing shortage worries

Bigger corn supply this fall should ease concerns of a shortage and slow food inflation

 

Corn supplies are projected to be higher than expected this fall. A bigger crop would ease concerns of a grain shortage and could slow food inflation later this year.  The U.S. Agriculture Department said Tuesday that 880 million bushels of corn will be left over when the harvest begins. That's an increase from the previous estimate of 730 million acres.  Higher corn prices led farmers to plant the second biggest corn crop this year since World War II.

 

More expensive grain has led to food price increases this year. It could ultimately make everything from beef to cereal to soft drinks more expensive at the supermarket. For all of 2011, the USDA predicts food prices will rise 3 percent to 4 percent.  News of the big corn crop brought down global corn prices 20 percent over the last month. A huge harvest in August could ultimately slow food inflation. It typically takes six months for changes in commodity prices to affect retail food prices in the U.S. Analysts say consumers could see some relief at the supermarket by early 2012.

 

Farmers saw corn futures rise, so they switched their acreage into corn from other crops like soybeans. The size of this year's corn crop will be 92.3 million acres, about 9 percent larger than the average annual corn crop over the past decade. The only crop bigger in the past 67 years was planted in 2007.

 

This report could help!

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Corn/ Corn ethanol will remain high until the VEETC payments stop.. As was posted past few days Ethanol and Oil are riding high on over producing corn ethnaol..they are both out for the fast buck ..the FREE Money that is the VEETC..pushing corn higher ..pushing ethanol higher and lowering the Price spread between E85 and Gasoline for the sake of producing and "additive" E10

 

 

The ethanol  industry is largely an additive Industry and has little do to do with creating an alternative fuel to Gasoline.. E85 gets lip service while E10 gets 99% of Production

 

 

The sooner the VEETC is stopped the better..

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So the VEETC is inflating Ethanol prices?  ???

 

I definitely disagree with raising the additive rate. 5-10% should be plenty for regular gasoline. The real contender should be E85 IMHO. O0

 

I would rather see more work to mandate Flexfuel engines even if it was only to make it so more cars could run higher blends of Ethanol out of the factory.

 

But I wasn't completely aware of the effect the VEETC has on prices. I figured that the blending mandate was more of a inflating factor while the VEETC would reduce Oil and Ethanol prices at the pump. At a cost of multiples in taxes I might add.

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