Chicago, June 23 - Rising corn prices have challenged the high fructose corn syrup industry, but the food and beverage sweetener remains competitive with sugar, the chief executive of Corn Products International told Reuters on Monday.
"The price of corn is going up but sugar is going up as well," said Samuel Scott III. "There's still room between the sugar and corn price to pass through our price."
Bunge Ltd said on Monday that it would buy Corn Products for $4.4 billion to gain a leading position in finished corn products such as starches and sweeteners.
Most of Corn Products' syrup is sold on a fixed-price basis, with customers guaranteed prices through 2008. It is not yet clear how much prices will rise next year, he said.
"Corn is sitting at $7 (a bushel) today," Scott said. "It could go as low as $6 or as high as $8. We probably lost a couple of million acres but I think most of that is factored into the market."
The worst flooding in the U.S. Midwest in 15 years sent corn futures to an all-time high last week as flood waters destroyed millions of acres of corn and soybeans.
Spot corn futures climbed as high as $7.60 last week before retreating on Thursday and Friday, and trading at $7.23 a bushel on Monday at the Chicago Board of Trade. Spot corn futures have risen 67 percent since the start of the year.
The most active contract for raw sugar on the ICE Futures U.S. hit a nine-week high of 13.28 cents per lb on Monday. The spot contract has risen 8 percent this year, hitting 15 cents in March.