Audio – Pay a penny more for corn flakes? “Big deal.”
Demand for corn-based fuel, such as ethanol, might increase corn prices — but there would not be a significant hit to the consumer, says Iowa Renewable Fuels Association President Monte Shaw.
“A 12-ounce box of cornflakes costs $2.79, but there’s less than a penny’s worth of corn in it. So let’s say that corn goes from $2 to $4, well you’ve just changed the price of cornflakes from $2.79 to $2.80. Big deal.”
However, Shaw acknowledged that “If you are the livestock industry and we have a bad weather year, there could be some issues there.”
Shaw was speaking in a phone interview at the Reuters Global Biofuels Summit 2007.
He also gave his views on how the Bush administration could give ethanol a boost.