According to the U.S. Department of Agriculture, in 1995
US corn production stood at 7.2 billion bushels, or 192 million metric tonnes. An estimated 14.7 million tonnes were used to make ethanol, based on the Department of Energy ethanol production figures for 1995, and allowing for a conversion rate of 2.8 gallons per bushel. 4.9 million tons of dried distillers grains, based on a 33 percent conversion rate, would have been returned from ethanol producers to the grain markets. This left 182 million tonnes available for US consumption and export.
, US corn production rose to 13.1 billion bushels, or 349 million tonnes. An estimated 62 million tonnes were used to produce ethanol, based on DOE ethanol production figures and a conversion rate of 2.8 gallons per bushel. 21 million tons of dried distillers grains, based on a 33 percent conversion rate, would have been returned from ethanol producers to the grain markets. This left 308 million tonnes available for US consumption and export.
The total production of corn available for domestic, non-ethanol consumption and/or export, increased 126 million metric tonnes from 1995 to 2007. Ethanol consumption increased during this period by 31 million metric tonnes. Overall production increased by 82 percent, and overall non-ethanol production available for domestic consumption and export rose by 69 percent.
With US production increasing by 157 million tonnes, after 31 million net metric tonnes are subtracted for the change in ethanol consumption, and 25 million tonnes are subtracted for a 14 percent increase for other domestic uses and export (to keep pace with population change), the US produced 101 million metric tonnes more corn in 2007 than required for its 1995 pattern of domestic production, export, and for ethanol.
Eliminating all other factors, including the potential for increases in domestic production in the US and China and changes in corn demand from other sources, US grain reserves would be depleted by rising Chinese demand as soon as fall 2013, even if the entire US corn ethanol industry were eliminated overnight and all corn was made available for export to China to meet rising demand for livestock feed.
Comparing the rise in corn, oil, wheat and rice prices since 2000, using the World Resource Institute and DOE price tables, it can clearly be seen that corn prices, while escalating rapidly, are rising slower than any of the three other food and fuel commodities. In fact, the intensity of price increases is in inverse proportion to the conversion rate into ethanol.
Corn, which is used the most among the four commodities as a biofuel, has the lowest price increase. Rice and crude oil, which are not used to make ethanol, have experienced the fastest price increases.