“If you're growing corn, you're growing a product that has a home that doesn't have to depend on exports or anything else … which is a big, big bonus,” Lewis Campbell, a corn marketer with South Carolina-based Palmetto Grain Brokerage, told participants at the 2007 Corn Short Course and Georgia Corn Growers Association meeting.
Corn prices have jumped by almost $2/bu. from last year to between $3.75 and $4/bu. in February. The surge in prices this year can be attributed largely to the increase in demand for corn to fuel the expanding U.S. ethanol industry, he says.
To meet the new demand, U.S. corn growers will need to grow an additional 10 million acres this year. Last year, farmers harvested about 71 million acres for grain.
Prices should stay high. “But volatility will be the name of the game,” Campbell says. In recent years, corn prices would fluctuate little from week to week. “Now, it moves 20¢ in a day,” he says. “It's hard to take your emotions out of it, but it's going to be like that all summer long.”
Pencil to paper, corn right now looks as good or better economically than other traditional Georgia crops like cotton and peanuts, says Nathan Smith, a University of Georgia Cooperative Extension agricultural economist. This is not usually the case.
It's too early to say by how much, but farmers will certainly plant more corn in Georgia this year, he says. Georgia farmers harvested about 225,000 acres last year for grain. They'll likely increase that to 300,000 or more this year, the highest since the late 1990s.