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[Snip]...I have long felt that one of the biggest threats to the U.S. ethanol industry is a major drought/crop failure in the heart of corn country. This year we may be experiencing such an event. Recent reports indicate that what had been expected to be a record crop of corn has been downgraded such that only 40% of the corn crop is being classified as in good or excellent condition. This is down 48% versus last week and 69% versus a year ago.

Corn prices are nearing the record highs of last summer as the U.S. Midwest suffers its worst drought since 1956. Shoppers should expect higher grocery bills, because corn is used in three-quarters of supermarket products. But don’t panic. Overall cost hikes are likely to be modest. “A 50% increase in the price of corn tends to raise total shopping bills by about 1%,” says Ricky Volpe, a research economist with the U.S. Department of Agriculture. Corn’s price has jumped 45% this summer. Of course, even a modest increase to shopping bills is unwelcome news for households on tight budgets. Strange...

According to the US Bureau of Labor Statistics, Consumer Price Index Data for March 2012, the Consumer Price Index for fresh vegetables purchased for home use rose 4.5 percent from the same time last year. Recent USDA data also shows that the price of grains such as corn, wheat, rice, and soybeans has increased 234% since January 2002...

Seeking to meet new regulations on low-carbon emission fuels, Europeans are battling over millions of hectares of African land in order to grow biofuels. This is detrimental to food crop production, warn NGOs. A jatropha nursery field by Stefano Valentino Imagine a surface the size of Switzerland – 4 million hectares – totally covered in plantations aimed at supplying fuel to vehicles and electricity plants. That's the total land currently exploited in Africa by Western countries in order to supply biofuels. The British are in the lead with a record 1.6 million hectares of cultivated land, followed by the Italians,...

The head of the world's biggest food company Nestle said on Friday that rising food prices have created conditions "similar" to 2008 when hunger riots took place in many countries. "The situation is similar (to 2008). This has become the new reality," the Swiss giant's chairman Peter Brabeck-Letmathe told the Salzburger Nachrichten daily in his native Austria in an interview. "We have reached a level of food prices that is substantially higher than before. It will likely settle down at this level. "If you live in a developing country and spend 80 percent of your income on food then of...

High energy prices and bad weather -- including blistering hot temperatures, flooding in some places and drought in others -- hurt this year’s agricultural output. But farmers agree that a major problem is the soaring price of corn, which is used directly in products like cereal, and indirectly as livestock feed. Corn is nearly twice as expensive now as it was last summer -- even though US farmers planted the second-largest crop since World War II. Why? Well, 40 percent of the crop goes to produce 12.6 billion gallons of ethanol to meet the government’s renewable fuel standards. In other...

The world grain inventories were already depleted from truly terrible weather in 2010. Now we are seeing even worse weather so far this year. China is experiencing its worst drought in 50 years. The government says this weather is decimating a major grain belt, and it is leaving livestock without water. Fish farms have been ruined. Who knows the long term effects? More than 4.3M people are having trouble finding drinking water. Actually this last is a much bigger problem throughout China, which has a long term drinking water problem. The Chinese have released extra water from the Three Gorges...

With drought threatening food production in the EU, US and China, analysts at Renaissance Capital believe the next 8-10 weeks will be crucial to prices in 2011 and 2012. “The food price threat for 2011-2012 is very significant, but may disappear in August. It depends entirely on the weather over May to July,” said Renaissance Capital’s Charles Robertson. “If we do not get the right mix of rain and sun in the coming 8-10 weeks, then later this year we will see record price levels for the most important cereal in the world today – corn,” he said. If this...

(snip) What triggered the upswing? In part: ethanol. President George W. Bush "came forward with—what do you call?—the edict that we were going to mandate 36 billion gallons of alternative fuels" by 2022, of which corn-based ethanol is "a substantial part." Companies that blend ethanol into fuel get a $5 billion annual tax credit, and there's a tariff to keep foreign producers out of the U.S. market. Now 40% of the corn crop is "directed to ethanol, which equals the amount that's going into livestock food," Mr. Pope calculates. (snip) Food price inflation isn't a problem confined to America's shores....

A surge in global food prices has prompted fresh criticism of US subsidies for ethanol, which diverts massive amounts of corn from global food supplies for energy. Senators Tom Coburn, a Republican from Oklahoma, and Ben Cardin, a Maryland Democrat, introduced a measure last month to scrap the tax credit of 45 cents per gallon for ethanol in gasoline. "The ethanol tax credit is bad economic policy, bad energy policy and bad environmental policy. The $6 billion we waste every year on corporate welfare should instead stay in taxpayers' pockets where it can be used to spur innovation, stimulate growth...

...and he filled tanks feeding the boat’s 200 horsepower Mercury engine with gas that had been blended with 10 percent ethanol. “I heard a station in Greenville had straight gas, but I just took it to the next one I could find. Within 10 minutes, my engine started failing,” Gray said. “(The ethanol) had crystallized and crumbled and had clogged my fuel line, and I had to tear out all of the fuel system.” Gray saved hundreds of dollars by repairing it himself, but his troubles with the motor are nothing new to marine shop owners, lawn mower mechanics and...

Newt Gingrich got himself in a bit of hot water in some conservative circles recently with his support of Ethanol subsidies. It drew the scorn of the Wall Street Journal editorial board, who implied that the former speaker might have more than a passing financial interest in propping up King Corn. On Thursday Newt took to the “letters” pages of the WSJ to fire back. In the interest of fairness, we should allow him to make his case. Second, I am not a lobbyist for ethanol, not for anyone. My support of increased domestic energy production of all forms, including...

U.S. cereal giant Kellogg Co. said it would raise prices 3 percent in 2011, the same increase it reported for its profits in 2010. Fourth-quarter profits rose 7 percent over the third quarter and annual profits were up 3 percent, The Detroit News reported Friday. Revenues for the year dropped 1 percent to $12.4 billion. John Bryant, the company's new chief executive officer, said Kellogg would raise prices due to the rising cost of commodities. "The price increases are merely passing on a portion of those higher costs," he said.

"Two hundred years ago, this was prairie covered with six-foot-high switchgrass. Winnebago Indians lived here, and then white settlers … Now 50 wind turbines that were erected over the winter and the (VeraSun) ethanol plant, have brought new energy to a town that long lived off the ground God created with glaciers, and laid down here."

Ethanol damages engines and is not a viable alternative to fossil fuels, but farmers and lobbyists don't want you to know that

Plans to make European motorists use more biofuels could take an area the size of Ireland out of food production by 2020 and accelerate climate change, a study has found. The report by the independent Institute for European Environmental Policy (IEEP) is based on plans that countries have submitted to the EU detailing how they intend to meet their legal requirement to include 10% of renewable energy in all transport fuels by 2020. IEEP calculations suggest that the indirect effect of the switch will be to take between 4.1m and 6.9m hectares out of food production. In addition, say the...

Think fast: What ingredients were in the gasoline you bought last time you filled up your tank? Pure gasoline? A mix of gasoline and ethanol? What percentage of each? The one thing for sure is you probably didn't buy diesel, since you'd still be at the gasoline station, waiting for a tow truck, if you had. Chances are, the gasoline you bought was 10 percent ethanol, a fuel derived from corn. Ethanol reduces fuel economy and damages engine components. Your car would run better and more efficiently with pure gasoline, and its engine would last longer. It also would pollute...

The Obama administration wants to boost the amount of corn shoved into the gas tank of newer cars by 50 percent. The Environmental Protection Agency (EPA) made this happen on Wednesday by giving partial approval to E15, an automotive fuel blend containing 15 percent ethanol. This dirty deal will enrich the major ethanol producers represented by Growth Energy while impoverishing taxpayers and anyone else who cares about clean air. Technically, the agency only approved a waiver allowing the sale of E15 for vehicles from model year 2007 and later, but don't be fooled by this incremental approach. The EPA is...

Agriculture Secretary Tom Vilsack says the government should move quickly to increase the amount of ethanol allowed in gasoline. Ethanol producers asked the Environmental Protection Agency last week to increase the amount of ethanol that refiners can blend with gasoline from a maximum of 10 percent to 15 percent, which could boost the demand for the renewable fuel additive by as much as 6 billion gallons a year. However, automobile and small engine manufacturers have said there's no certainty yet that such an increase will not harm engines and fuel lines.

The use of ethanol and other renewable fuels supposedly helps gasoline burn cleaner creating less pollution. It also reduces America's reliance upon foreign oil. Last Monday the Environmental Protection Agency increased the amount of renewable automobile fuels required to be sold in the United States next year from 7.8 percent to 10.2 percent of the 138.5 billion gallons of gasoline projected to be consumed. This mandate mainly directs that higher levels of ethanol be mixed with gasoline. The higher standard is required by the Energy Independence and Security Act of 2007, a law that requires the increased use of renewable...