ETHANHOL HIKING FOOD COSTS: IOWA STATE

One time jump, not a perennial increase

Consumer food price increases due to ethanol competition for corn could be as high as $50 a person per year, according to an Iowa State University study. The roughly $1.50 per bushel run up in corn prices as ethanol competes with food and feed uses is the culprit, the study says, but says the price jump is "a one-time shot, not a perennial increase." Dr. Bruce Babcock, author of the study, said while some companies are passing along legitimate ingredient cost increases, some food companies may be using the corn price increase as an excuse to raise prices.