December 24, 2010

Mexico unveils hedge against increasing corn prices

Mexico announced on Wednesday (Dec 22) that it had set up a hedge against soaring corn prices in a bid to alleviate their impact on tortilla, which is an essential part of the diet of millions of Mexicans, according to media reports.

The country's economic minister Bruno Ferrari said the government had purchased corn futures to guarantee prices and supply until the third quarter of 2011.

The move came after tortilla makers in the country threatened to lift prices by 50% last week to compensate for the rising cost of corn and natural gas.

Meanwhile, corn prices hit US$6.0975 a bushel on Wednesday (Dec 22), the strongest level since the middle of 2008, bringing total gains since January to 46%.