Nearly a year ago, there were complaints in border states in Mexico that the new ethanol plants were driving up the price of corn to the point that the poorer segments of the population were unable to purchase tacos in their accustomed quantities.

In addition to a distinct and abrupt rise in price, there are areas where corn has been the staple food where they are beginning to see an inability simply to get enough to satisfy the need, at any price.

Meat producers are whining loudly about the increased cost of grain for livestock feed, and most meat prices in my local market already have increased by more than 30% over the past 3 or 4 months.

Estimates here, where "ethanol plant building" is at boom levels, are that the planned plants will require more grain than is currently available from all sources within roughly a year. While more farmers are considering switching to "ethanol friendly" grains, there simply isn't enough water available to meet the requirements if massive conversion to water-intensive crops happens.

Several planned ethanol plants have been canceled. Investors are beginning to question some others that are looking a bit "shaky" at present.

John