Instead, the culprit is spiking fuel expenses, they say.
Corn growers and their representatives went on the offensive this week as criticism mounted and charges flew in Washington and elsewhere.
Growers were accused in congressional hearings of chasing the ethanol fuel dream by planting more corn than ever, thus running down supplies of other grains and driving up prices.
But David Gibson, executive director of the Texas Corn Producers Board, pointed to a recent study released by the Texas A&M Agricultural and Food Policy Center that found that the price of corn has had an insignificant influence on rising food prices.
The study was called, “Effects of Ethanol on Texas Food and Feed.”
In Bell County, corn is king - about 50,000 acres are planted annually. Significant acreage is also planted in Milam, Falls and McLennan counties in Central Texas, according to Dirk Aaron, agriculture extension agent with AgriLife Extension for Bell County.
In a good year, farmers here can average about 100 bushels per acre of corn, Aaron said.
“Everybody’s thinking our farmers are making lots of money because of the higher prices,” he said. “But, look at the price they’re paying for diesel and for fertilizer. You can’t cut fuel and you can’t cut fertilizer and get 100-bushel-per-acre yields.
“And if prices go south tomorrow, you won’t see the price of those inputs drop.”
The issue is the same for most agriculture producers, Aaron said. They get blamed for rising food costs, but in a typical end product the food is a small part of the overall cost of getting the product into the hands of consumers.
“Farmers never really have great windfalls,” he said. “At least I haven’t seen that in my career.”
The A&M study found that at today’s prices, there is only about 6 cents worth of corn in an 18-ounce box of corn flakes.
The primary reason for escalating food prices are crude oil prices that today top $120 per barrel, Gibson said.
“A $1 per gallon increase in the price of gas has three times the impact on food prices than a $1 per bushel increase in the price of corn,” he said.
The other big costs in the food chain are processing, packaging, transportation and advertising.
Gibson cited an USDA report showing that the “farm value” of food is only about 19 cents of every dollar that goes into processed food.
But, Steve Yoder of Dalhart, vice chairman of the corn producers board, noted that if corn cost $5 per bushel, the price of the corn in a bag of corn chips costing $3.29 would be only a dime.
The A&M study says that fuel and irrigation costs have increased 37 percent in the past two years. Fertilizer costs are up 45 percent, seed is up 23 percent and interest is up 18 percent.
