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Ethanol Blamed for High Food Prices

Federal ethanol mandates that encourage its production are a major reason why food prices worldwide have reached record levels in the past several months, say some economists.

Growing corn in order to receive ethanol subsidies decreases the amount of land available for food production, making food more scarce and increasing its price. “Earlier this month, the United Nation’s Food and Agriculture Organization reported that global food prices had risen for eight consecutive months, reaching the highest levels since the agency started tracking prices in 1990. The prices are high in large part because of steadily growing worldwide demand for food, and because of natural disasters that have hurt harvests, but they’re also affected by government policies.”


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