Looking for a good indicator for where food prices are headed? Watch corn.
Corn’s impact on the food industry is unlike that of any other agricultural commodity. At its most basic level, corn is a food staple for billions of people around the world and a key ingredient in dozens of products like breakfast cereals, baked goods, breads, tortillas, chips, soft drinks and even bourbon. But its reach goes much further.
Corn drives fertilizer prices because corn plants suck up soil nutrients more than almost any other crop. It also plays a critical role in the price of meat because corn is included in most types of feed for cattle, hogs and chickens.
“It’s practically in everything we eat,” said Douglas Yungblut, a farm consultant based in Waterdown, Ont. “It does drive a lot of the other commodities, other grains tend to follow it as well.”
How big is corn? In 2009, the value of the crop in the United States, the world’s largest producer, reached $49-billion (U.S.).