CNN Correspondent Links Rising Food Costs to Ethanol
You're going to need a few extra bucks to pay for those corn flakes every morning.
CNN's senior business correspondent Ali Velshi let viewers in on an underreported fact about rising commodities prices: the government mandate for ethanol production is making corn and other agricultural products more expensive-making inflation a top priority for Americans.
"Several years ago, we made some decisions about how corn is going to be used to make ethanol, which is added to our gasoline," said Velshi on "American Morning" April 4. "A number of people think that that was meant to reduce our dependency on crude oil. What is does is it takes what is fundamentally a food source and makes it into a gasoline source. That's caused corn to go up."
He went on to explain that in the recent food commodities surge, which includes products like wheat, soybeans and rice, corn has gone up to $6 a bushel-making everything from animal feed to cereal more expensive.
Anchor Alina Cho pointed out that high fructose corn syrup also sends the price of soda up and Velshi pointed out that the price surge would also affect other products like dairy, chicken and beef.
Finally some in the media are reporting the connection between federal mandates and food inflation. The April 7 issue of Time magazine slammed mandates for contributing to increases in global crop prices and devastating the environment. Reporter Michael Grunwald said rising prices are "spurring a dramatic expansion of Brazilian agriculture, which is invading the Amazon (rainforest) at an increasingly alarming rate."