Wednesday, May 23, 2007

Rising corn prices hit grocery shoppers' pocketbooks

The rising demand for corn as a source of ethanol-blended fuel is largely to blame for increasing food costs around the world, and Canada is not immune, say industry experts.

Food prices rose 10 per cent in 2006, "driven mainly by surging prices of corn, wheat and soybean oil in the second part of the year," the International Monetary Fund said in a report.

"Looking ahead, rising demand for biofuels will likely cause the prices of corn and soybean oil to rise further," the authors wrote in the report released last month.

Statistics Canada says consumers in the country paid 3.8 per cent more for food in April 2007, compared to the same month last year.

Jyoti Sahasrabudhe, an independent food industry consultant in Calgary, says consumers would be amazed to learn just how much of their food contains corn.

In a recent trip to the grocery story with CBC News, Sahasrabudhe underlined the point.

"For example, in the sushi in the California rolls, we've got hydrolyzed corn protein. Here we are looking at coiled garlic sausage and I believe we will find some modified cornstarch. It's used as a thickener to bind all the ingredients together," said Sahasrabudhe.

"Corn has so many uses throughout the food chain as feed for animals, as an ingredient on its own. I don't know that a relatively inexpensive substitute for all those functions could be found."

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