Higher food prices expected as farmers cut back on corn

U.S. farmers plan to cut back corn planting and boost soybean production, a shift that could send ripples from the farm belt to your grocery bills. The U.S. Department of Agriculture on Monday released its prospective plantings report. The report, which came amid surging grain prices, bore news that affects grain farmers, livestock producers, ethanol companies, food processors and, ultimately, consumers.

Corn plantings are expected to fall 8 percent this year, to 86 million acres, according to the Department of Agriculture. Last year farmers planted a post-World War II record of nearly 94 million acres of corn to meet burgeoning demand for ethanol, which is expected to soon absorb about 30 percent of domestic corn production. “Last year many soybean growers switched from soybeans to corn as ethanol expansion strongly increased the demand for corn,” the Department of Agriculture said.

This year, though, many of the 86,000 farmers surveyed for the report said they were shifting production back toward soybeans, which had surged in price. Soybean planting is expected to increase 18 percent this year, to almost 75 million acres. Some experts said prospects for diminished production could drive corn prices, already trading at near-record levels, even higher.

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