The USDA made their first official projections for 2009 crops, most of which are still unplanted.  (and we are having another wet spring) The government's forecast suggested that food makers will experience relatively high crop prices at least into next year. They expect the season-average price of corn to trade around $4.10 a bushel, with a +/- $.40 spread per bushel.  Although that price is way less than last June, it‘s only $.10 less than the record season-average price for the 2007 crop.  Additionally, the USDA expects the season-average price of the 2009 soybean crop to fluctuate around $9.45 a bushel, +/- $1.00, with a spread that is just 4 percent less last fall’s price at harvest.

Originally the government had predicted a 5.5% rise in the Consumer Price Index for food this year, but now some non-USDA ag economists are calling for less. (Possibly in the 4 to 4.5% range) This is relatively good news for consumers, but keep in mind that food prices in 2005 and 2006 only climbed 2.4%.

Somehow I have the feeling that we will see more of the blame game we did last year.  Hopefully this year we can convince people that the farmers and ethanol aren’t the ones to blame. Here’s the proof.

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