Right now, there is no shortage of rice. Rice is the most important food for nearly half of the world's population, and especially the poorer populations. Global ending rice stocks for 2009-10 were the highest in seven years. Wheat stocks are near their average level from this past decade and well above the low they reached in 2008. However, corn is in dangerously short supply -- the lowest that it has been in 37 years.
The corn ethanol policy is a driver of high food prices worldwide. More than 15 percent of global corn production and a total of 35 million acres are devoted to U.S. ethanol. The U.S. is the largest exporter of corn, but we use twice as much corn to produce ethanol as we use it for food export.
Wheat and soy prices increase when corn prices are high, since their acreage allotment is replaced by corn. In addition, wheat and soy get substituted for corn as animal feed.