Iowa State professor says high corn prices the result of wheat prices, not the other way around

In Iowa, a professor at Iowa State said that high corn prices are slowing down the pace of ethanol production, but would give the ethanol infrastructure development time to catch up.

Professor Robert Wisner said that if all 329 planned ethanol plants were built, they would utilize more than the entire 2006 US corn crop.  He said that high corn prices were the result of the high price of wheat, not the other way around – and that wheat prices had been driven up by poor weather in regions such as Australia. He said that the 50-60% price discount for ethanol compared to gasoline offered a strong incentive for investment in ethanol infrastructure.

He also said that there were 7 million acres of conservation land in the Corn Belt states, of which half could be put into production, but that adverse environmental results would have to be considered.

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