“Corn prices have dropped by about half since earlier this year, yet food prices have remained high and are expected by some to remain high,” Tolman noted. With commodity and energy costs now significantly lower, it’s time for food companies to take a hard look at the prices they’ve increased – often, for smaller packages designed to look like the larger-sized packages.

“Ethanol is an important part of America’s balanced energy sector and needs to play a bigger part if we are to reduce our dependence on foreign oil with a fuel source that is home-grown and renewable,” Tolman said. “At this time of economic crisis, U.S. ethanol production supports jobs and communities in rural America while boosting our nation’s gross domestic product and paying its share of taxes to fund important government programs.”

Tolman also laid out the many ways in which corn farmers are becoming more efficient in their use of fertilizers and pesticides, and reducing the impact on land through conservation tillage practices. Thanks to technology and improver agronomy, Tolman said, growers are boosting their production per acre significantly, and are expected to increase it each year well into the future with new corn hybrids in the pipeline that will reduce the need for nitrogen and provide drought-tolerant corn.

“We’re seeing great strides being made in corn production, thanks in great part to technology,” Tolman said. “While we are growing corn on about the same acreage as back in the 1940s, we’ve seen production more than quadruple. Back then, you would have needed a farm the size of Texas, Louisiana and New Mexico to grow that much corn.”

The Economics of Ethanol conference was sponsored by the Federal Reserve Bank of St. Louis; Washington University’s Weidenbaum Center on the Economy, Government and Public Policy; and the university’s International Center for Advanced Renewable Energy and Sustainability. It included presentations and discussions on the profitability of corn ethanol processing, the costs and benefits of corn ethanol as a fuel source, the impact of the ethanol boom on rural America, and the future of biofuels.

Click here for a copy of Tolman’s presentation