I Can't Believe It's Corn!

By Jean Folger | August 12, 2010 AAA
I Can't Believe It's Corn!

In 1621 when the Plymouth colonists and Wampanoag Indians shared an autumn feast and the first Thanksgiving celebration, corn was on the menu. Corn had been around a lot longer - scientists believe the origin of corn was in central Mexico, where fossil corn pollen has been found to be at least 80,000 years old - but it was this exchange between the Old World and New World that proved to alter the course of corn. Corn was soon recognized as a valuable food crop throughout Europe and eventually northern Africa, western China and the East Indies. In addition to food, corn products were important in making household necessities such as bed mats, moccasins and bags.

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Fast forward to the 20th and 21st centuries and corn is found in a vast variety of products and is a formidable force in the economy. The use of corn and corn products is so widespread that you might find yourself thinking: "I can't believe it's corn."

Surprising Corn Appearances in Food
Corn is grown on more than 400,000 farms in the United States and is used in more than 3,500 applications. While the majority of each year's corn harvest is consumed by domestic and overseas livestock, poultry and fish production, corn ends up either directly (pop corn, for example) or indirectly (high fructose corn syrup) in a growing number of products meant for human consumption.

While "corn" may not be listed on the ingredient list, corn is included in food products such as ice cream, baby food and infant formula, pudding, fruit drinks, wine, beer, peanut butter and chewing gum. Corn is also found in margarine, processed meats (such as bologna and bacon), cakes, spaghetti sauce, jams and jellies. Corn even appears in powdered sugar, salad dressings and many breads and pastries. With such pervasive use, it is challenging to find processed foods that do not contain any corn ingredients at all. (Corn's not the only ubiquitous additive; oil is used in everything from hygiene products to food to cough syrup. Learn more in I Can't Believe It's Oil!)

Corn Uses in Non-Food Products
Corn and corn byproducts are also used extensively in non-food products such as aspirin, envelopes, toothpaste, starched clothing and stamps. A growing number of "green" products are using corn technology as a biodegradable component of such items as ethanol windshield washer fluid, certain types of road de-icers and ethanol fuel - this is a hot topic and quite controversial due to the large amount of land and water required for its production. Disposable cups, containers (such as to-go boxes) and packaging peanuts can now be made from corn and are fully compostable and biodegradable.

Corn Economy
According to the USDA Agricultural Projections to 2018 (February 2009, USDA, Economic Research Service), corn farming and yields are projected to increase, resulting in record corn production. This increase is attributed to expanding livestock herds (the majority of corn production goes towards livestock feed) and industrial corn use. That said, corn should only continue to grow as an important economic commodity. Corn represents hundreds of millions of dollars in monthly agricultural exports, and plays a significant role in worldwide stock markets, with corn futures and options trading accounting for billions of dollars of daily market activity. (Learn more about investing in corn in Investing Seasonally In The Corn Market and Grow Your Finances In The Grain Markets.)

Supply and demand naturally impact corn prices and can be affected by weather (such as drought or late frost) and by current trends in corn usage, such as ethanol production. Corn is used in so many products (or used in the production of others, such as livestock) that corn's supply and demand have a deep influence on the price consumers pay for a growing number of products. Eggs, for example, cost more when corn costs more, since corn is fed to the hens that produce the eggs. Likewise, increased ethanol production could result in higher fuel prices when corn prices are high.

The Bottom Line
Corn has been an important crop for thousands of years. New uses for corn are being developed rapidly, increasing its demand. While certain corn uses are controversial, as is the case with ethanol, other corn-based products, such as disposable cups, are proving to be more environmentally sound alternatives to everyday products. Corn has been and will continue to be big business, and as more uses are developed, we may continue to be surprised by the versatility of corn.

Catch up on your financial news; read Water Cooler Finance: Who Is The Next Buffett?

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