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QSR Feature
The Economics of Corn

The Corn Refiners Association says that the subsidies do not affect the refiners, just the corn farmers. Is this accurate?

We found out that our corn was going to become not sweet corn on the cob but in fact fast food, essentially corn-fed beef for hamburgers and high fructose corn syrup soda.”

Ellis: No. … Of course, you know that that abundance of cheap corn benefits the HFCS industry. The reason that industry is so successful is they’re able to sweeten things much less expensively than sugar. The reason they’re able to do that largely is because the raw material in HFCS is incredibly cheap. Our one acre of corn could have sweetened 57,000 cans of soda. We grew 10,000 pounds of corn and it took us about two hours of labor and a couple hundred dollars of input and that’s just incredible. That’s unbelievably cheap, and the reason it’s so cheap is that the subsidies system keeps everybody there growing corn.

Is cheap, healthy, HFCS-free food likely to make its way to the drive-thru anytime soon?

Cheney: I think the rising fuels costs might start to redefine the way we think about the cost of food in this country. It’s probably already happening. … I hope that that begets a renewed interest in local foods.

Ellis: I really agree. I really think the huge consumer demand that is obviously out there and growing for foods that are locally produced or sustainably produced or come from a family farm or that are raised in a humane way is a real force to be reckoned with.

These kinds of products are probably going to be more expensive.

Cheney: I’m hopeful that the simultaneous processes of consumers reaching out more to producers asking them to grow the foods they want to eat and also hopefully in the future more government support for local food systems will create the supply of these foods to catch up with demand of these foods and with that the price will go down. I can’t overstate how important it is in the drive to produce more sustainably grown, local foods, that we not create two food systems—one for everybody who can afford fancy food at the farmer’s market and one for everybody else.

Ellis: It’s really important to look at the situation not from a position of blame but for opportunities. To me the opportunities are huge and the blame is across the board. We really don’t blame the fast-food industry or the farmers or the corn syrup lobby for what has happened. In some sense we got to where we are out of very reasonable logic. … The question is how can we incentivize the right kind of food. How can we open up entrepreneurial opportunities to make good food served to a broad spectrum of the population good business as well as ethically good business?

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