You don't have to like it, but ethanol production has nothing to do with food shortages.
Demand is up, as you so correctly mentioned gasoline prices have exacerbated the situation. With the crash of the dollar, our exports(food) are cheap elsewhere, further driving the market higher. Some say speculators are also influencing prices, this is a possibility I guess.
It could get worse, much worse. The fields in the midwest are so soaked, often flooded, that some may not be able to be planted in time to complete a growing season. One could make some money selling short, I'm having trouble coming up with any other good news.