The difference in corn prices between 2012 and 2013 means a nearly $7.5 billion loss to the Illinois economy.
Data resulting from an analysis conducted by Western Illinois University's Illinois Institute for Rural Affairs clearly illustrate the close tie between a strong corn industry and economic activity across the state of Illinois.
"When corn prices are strong, the impacts are felt statewide," says Gary Hudson, Illinois Corn Growers Association President. "When corn prices drop, the negative impacts are also felt statewide. Basically, what's good for corn prices is good for Illinois."
WIU's economic model shows that when the average price received for corn in 2012 dropped some 40% in 2013, the cost to the Illinois economy was $7.48 billion in the value of goods and services. The equivalent of 76,082 jobs were lost, GDP dropped by $3.8 billion, and compensation/proprietor income dropped by $1.8 billion.
Prices dropped in 2013 because production returned to near trend-line levels and demand remained limited for corn because of arbitrary caps on the ethanol market, the second largest user of corn in this country. Removing the factors that limit ethanol would mean stronger corn demand, stronger corn prices, and a stronger Illinois economy.
"It's clear that the choices we make in policy, rules, and regulations that impact corn farmers really should be understood as impacting everyone. When we support the family corn farmers of Illinois by making reasonable decisions from an economic standpoint, we can all win," Hudson adds. "That's why ICGA supports Consumer Fuel Choice for Illinois."
Consumer Fuel Choice for Illinois is Senate Bill 52 and House Bill 165. The ICGA-backed legislation would encourage the use of higher blends of ethanol in Illinois, including E-15 by providing a tax incentive to retailers and grant monies for the installation of flex fuel infrastructure including E-85 pumps.