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1. In a medium saucepan over medium-low heat, melt the butter. Gently cook onion in hot butter for 3 to 5 minutes; just until tende. Do not let onion brown. Add 3 1/2 cups of the corn and sprinkle generously with kosher salt. "Good seasoning at this stage really draws out the flavor of the corn," Scott says. Stir well, then cook 5-7 minutes. Do not let onions or corn brown. Stir in 1 Tbsp. of the sugar.
2. In a medium saucepan combine 2 cups of the milk and the half-and-half. Warm over medium-low heat just until heated through. Pour the corn mixture into the warm milk. Stirring often over medium heat, bring just to simmering. Remove from heat. Cool slightly.
3. Puree soup in batches, one-third at a time, until very smooth. Pour pureed soup through a fine wire strainer set over a bowl, allowing soup to drain through. Return soup to pan. Reheat over medium heat; whisk in grated nutmeg. For thinner soup, warm the remaining 1 cup milk over medium heat; gradually stir into soup to reach desired consistency. Taste for seasoning; add salt and some of the remaining 1 Tbsp. sugar. To serve, divide soup among bowls, top with some of the remaining 1/2 cup corn and lightly dust with freshly grated nutmeg. Makes 4 to 6 servings.