U.S. ethanol industry raising prices corn, tortilla prices

The corn for fuel or food argument is hitting home for many people in Mexico. According to Z Mag, tortilla prices in many regions of Mexico have jumped up by more than 50 percent, thanks to more and more corn going to feed ethanol production instead of people. Protests aimed at Felipe Calderon's government prompted him to negotiate a price cap of 8.5 pesos per kilogram for tortillas made by the largest manufacturers. Still, this is a 40 percent increase. In some regions, a kilogram of tortillas now costs as much as a third of a day's wage. Z Mag says that while customers get hurt, Wal-Mart and "and the U.S. transnational companies that supply Mexico with corn are likely to be the beneficiaries." Local maize production has been hurt by cheap imports, writes professor Enrique Ochoa (who is working on a book on the tortilla industry), citing a study by the International Relations Center that found that between 1999 and 2004, the price Mexican corn farmers received for their corn fell by about half thanks to U.S. supply and many quit for other work. With ethanol helping to drive up corn prices in the U.S., the Mexican diet is affected as well. Live green, go hungry?

[Source: Enrique C. Ochoa / Z Mag]

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