NPR reports one-third of the corn crop will be used for renewable fuels resulting in higher feed costs for livestock and higher meat prices for consumers.

Beef and pork prices usually increase as the holiday season approaches, but consumers have seen meat prices increase earlier, and higher, than usual this year. USDA data reveals meat costs up to 12 percent more than it did this time last year and the reason is farmers’ biggest cost – feed.

Corn was used as feed for livestock because it was cheap and abundant, but ethanol’s growing popularity has taken one-third of the corn crop, raising corn prices for both industries. While the ethanol industry receives a subsidy, livestock producers are forced to absorb the costs or pass it on to the consumer.

The increasing price of corn raises the cost to produce other food items according to Iowa State University economics professor Bruce Babcock. He says ethanol policies increase the cost of food by at least 1.5 percent, but the meat industry has been more heavily affected. He says ethanol has tied the fuel and food markets together so higher prices at the gas pump equals higher prices on the dinner table.

For more information click here.