In a web seminar Wednesday, John Lawrence of Iowa State University and Steve Meyer of Paragon Economics said as ethanol production's demands drive up corn prices, livestock prices will follow due to higher cost of corn for feed.
Lawrence and Meyer forecast a corn price range varying anywhere from $2 to $5 a bushel in the future.
The key to offsetting this cost, however, may be built into the ethanol production system. Byproducts from ethanol production, called distillers grain and solubles, can be fed to cattle and is often available for cheap.
These byproducts make for high-protein feed available for farmers who live close to ethanol plants, and with plenty of the feed available, prices are very cheap.
With corn prices climbing, however,
"Two dollars per gallon of gas at the pump translates into about $60 per barrel of crude oil," says