June 10, 2008 3:43PM

Why Corn is as High as an Elephant’s Eye

By Alexis Glick

This morning on Money for Breakfast I talked to a farmer in Wisconsin who has seen severe damage to his crop due to the enormous flooding. This on a day when the USDA released its crop report emphasizing continued weather disruptions and raised its guidance for wheat prices next year. Randy Roecker of Roecker’s Rolling Acres and a member of the National Dairy Board told me why this year has been so difficult. Honestly it was disheartening and eye opening! We forget that farmers are experiencing many hardships due to terrible weather conditions, rising oil prices and increased costs for items such as fertilizer, not to mention transportation costs for packaging and selling their goods.

Vic Lespinasse, a market analyst at Grainanalyst.com and Eric Bolling, a contributor and trader joined me along with Randy to discuss why corn prices have escalated and whether food inflation is here to stay. In aggregate food prices are up on average 9% over last year but certain products are MUCH higher than that.