Even With Ethanol Production, Corn Is A Bargain

All the news stories floating around lately have been saying that the average annual corn price for 2007 may set a new high. And while this is completely true that the 2007 price may end up higher than the record high price of $3.24 set in the 1995, the truth is that the current price is a bargain when compared to the inflation adjusted prices of the past.

Below you will see in the first column the year, in the second column the average annual corn price, and in the third column the average annual corn price adjusted for inflation to 2006 dollars.

2006 - 3.04 - 3.04
2005 - 2.00 - 2.07
2004 - 2.06 - 2.20
2003 - 2.42 - 2.63
2002 - 2.32 - 2.59
2001 - 1.97 - 2.23
2000 - 1.85 - 2.17
1999 - 1.82 - 2.19
1998 - 1.94 - 2.37
1997 - 2.43 - 3.02
1996 - 2.71 - 3.47
1995 - 3.24 - 4.25
1994 - 2.26 - 3.04
1993 - 2.50 - 3.47
1992 - 2.07 - 2.96
1991 - 2.37 - 3.53
1990 - 2.28 - 3.58
1989 - 2.36 - 3.88
1988 - 2.54 - 4.35
1987 - 1.94 - 3.44
1986 - 1.50 - 2.71
1985 - 2.23 - 4.17
1984 - 2.63 - 5.13
1983 - 3.21 - 6.46
1982 - 2.55 - 5.45
1981 - 2.50 - 5.90
1980 - 3.11 - 8.33
1979 - 2.52 - 7.52
1978 - 2.25 - 7.23
1977 - 2.02 - 6.91
1976 - 2.15 - 7.78
1975 - 2.54 - 10.03
1974 - 3.02 - 13.24
1973 - 2.55 - 11.87
1972 - 1.57 - 7.55
1971 - 1.08 - 5.42
1970 - 1.33 - 7.06

As you can see when the prices are adjusted for inflation the present price of corn is a bargain compared to what they were in the past.

Sources:

USDA Quick Stats
Inflation Calculator