The futures price of corn is known globally, but the cash price is always a moving target, reflecting local supply and demand. And with the ascension of ethanol refiners as the No. 2 consumer of corn, those refineries are significant dynamics in regional corn prices, says Stu Ellis, editor of the farm gate blog.
“But do those corn price spheres around ethanol plants offer similar prices to corn growers, or is there a price variation? If there is, how much is that variation and where are the farmers who benefit the most?” he asks.
A report from Kansas State University offers some answers.
Depending on competitive factors, such as livestock feeding or export markets, cash prices for corn vary significantly across the corn belt due to the increasing number of ethanol refineries that are being built, says Ellis. The average corn prices for many corn belt states can range from more than 20 cents above to more than 20 cents below the average price of cash corn for the region.
Source: the farm gate blog