Business Highlights – Ethanol demand to increase U.S. corn crop

Farmers are expected to plant 90.5 million acres of corn, according to the U.S. Department of Agriculture’s annual prospective plantings report released Friday. That would be a 15 percent increase over 2006 and the most corn planted since 1944.

Corn should be planted by mid-May for good yields and soybeans can be planted as late as June, which could be a fallback plan for farmers if corn doesn’t get planted in time.

The move to plant corn is in large part due to a rush to produce corn-based ethanol, which is blended with gasoline.

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NEW YORK (AP) ? Stocks rose, dropped and then recovered Friday ? just as they did over the course of the first quarter, as Wall Street showed nervousness about rising inflation and dollar weakness but took solace in resilient consumer spending and slow economic growth.

The Dow Jones industrials finished the day 5 points higher, and ended the quarter down 108 points, or 0.87 percent, the index’s feeblest performance since the second quarter of 2005.

Stocks initially climbed Friday on higher consumer spending and growth in Chicago-area manufacturing, but then plunged after the Bush administration detailed economic sanctions against China to protect American paper producers from Chinese government subsidies.

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WASHINGTON (AP) ? Federal testing of recalled pet foods turned up a chemical used to make plastics but failed to confirm the presence of a cancer drug also used as rat poison. The recall expanded Friday to include the first dry pet food.