Corn price increase to affect pumps, pantries - 13 WTHR Indianapolis

Families are going to feel the effects of this year's drought at the supermarket next year.

The drought pushed the corn crop down more than 20 percent, so corn is more expensive. By federal rules, 40 percent of that corn must go to ethanol.

That means higher pump and pantry prices. Some industry and consumer groups are lobbying the federal government to ease up on those rules that require so much corn go to ethanol.

But would waiving that rule really help?

"It is not assured if the waiver is lowered that would lower corn prices and therefore ethanol prices," said Dr. Chris Hurt, an agricultural economist at Purdue University.

Hurt says fuel refiners will just continue using ethanol because it's cheaper than straight gasoline. All gas must contain 10 percent ethanol by law.

"Right now they have no economic incentive to change," Hurt said.

So expect a six-cent per gallon hike in gas and three or four percent more for groceries this year and next.

But do we keep using so much food for fuel in the future? Hurt says that's up to government.

"We should not fault the crop producer, we should not fault the ethanol industry, what we should fault here, this year, is Mother Nature," said Hurt. "In policy, we want to be very careful about knee jerk reactions."

Hurt calls this summer's drought one of the three worst natural disasters in the U.S. since 1980.

But consumers worry.

"It's already expensive enough with kids with going back to school and everything," said mother mom Tirra Hoskins.

"I have extended family in farming. They are already suffering. If not, yet it's gonna come soon," said shopper John Evers.

"What can I do," said Amber Frey. "It's gonna happen anyway, can't really worry about it."