Posted on 05/14/2008 3:59:06 AM PDT by Renfield
Bump for a later read.
I guess they don't teach economics in journalism school.
An increase in the cost of an item will increase the demand for substitute items.
If you raise the cost of corn as a food worldwide (by shifting a significant portion away from the food supply) you will raise the demand, and the price, on substitute items such as wheat and rice.
Of course, he's in the pocket of "big corn."
There are so many myths about oil and oil pricing that it is treasonous and un-American to suggest high gasoline prices are actually great for America, so we won't do that here.
More folks should read this... without considertion for other opinions the “left-libs” keep folks dumb and dangerous...
I hear if you put minute amount of acetone in your gas it will improve your mpg. Do you know anything about that?
Except, feed corn wasn’t ever going to be made into tortillas anyway! And farmers are producing more types than ever before.
Another point, Wheat spiked in price a couple years ago ( also coinciding with the big boom in food commodities, gold, oil, potash, lead, copper, uranium, aluminum, tin, potash, zinc, etc etc, apparently the result of a drouth in Australia. Blaming corn ethanol for “the price of rice” is a stretch.
It may be that _corn_ ethanol is a “bad idea” but left unexplained is why so much disinformation and half-truths are necessary to use it as whipping boy for Everything Wrong With The World Today (including “climate change”.
Coal has nearly doubled in price in the last year or so, is that a result of Iowa and Nebraska corn farmers too?
I think the author makes a great point about the numbers of people emerging from poverty worldwide. One of the huge benefits of our trade with China has been the increasing wealth among the Chinese people, increasing demand for everything, including food.
However, I would debate this author over the reasonableness of ethanol.
First, with oil at $100/barrel, ethanol still cannot be produced without a subsidy....the ethanol crowd pushed for ethanol at $30/barrel with all sorts of competitive claims.
Second, if ethanol does become competitive to manufacture, it must be sold approximately 25% CHEAPER than gasoline to offset the reduced fuel economy delivered by ethanol.
Third, ethanol is turning out to produce emissions far more dangerous than gasoline. This will need to be addressed via more expensive automotive emission systems, costing the consumer even more.
Lastly, those hedging their bets on biodiesel are facing similar financial obstacles.
Oil is still cheaper to obtain and refine than anything else.
The author is correct, the world’s populations are emerging from poverty and consuming more. They will need oil on a far larger scale than what is consumed today. However, the United States refuses to explore and drill for oil, putting us in the position of being left behind the rest of the world.
The author doesn't even mention the lack of domestic oil production; in fact, he writes as if it doesn't exist. He bases a large part of his argument on the expense of using the military to keep foreign oil flowing, but domestic oil production doesn't require the military. Instead, he points to biofuel as our only hope. It makes all his other arguments disingenuous.
Yes, but you have to pay for the acetone. Unless you have a source for free acetone, your not getting anywhere.................
I didn't see anywhere in this article where it was stated how many gallons of oil it takes to make so many gallons of “less efficient” ethanol.
For example, if it takes 1.25 gals. of oil to make 1 gal of ethanol (just a hypothetical assumption), then we are becoming more dependent on “foreign” oil then before ... am I wrong?
The problem is that the subsidies shift biofuel production to favored producers (i.e. corn farmers) rather than the ones the market would naturally select (i.e. developers of techniques to produce fuel from otherwise worthless — and therefore dirt cheap — biomass).
You obviously missed the point of the hugely increased production between 1995 and 2007.
"...in 1995 American farmers produced 192 million metric tons of corn. Of this, 14.7 million tons were used to make ethanol, from which 4.9 million tons of dried distillers grain were returned to the grain market. That left 182 million tons available for consumption and export. In 2007, US corn production rose to 349 million metric tons. Of this, about 62 million tons were used to produce ethanol, of which 21 million tons of dried distillers grains were returned to the grain market. This left a whopping 308 million tons available for consumption and export -- an increase of 110 million tons, or about 82 percent, over the 1995 figures.
Lets see, 182 million metric tons available for food in 1995, 308 million metric tons available for food in 2007.
That doesn't look like a "food shortage" to me.
"Of course, he's in the pocket of "big corn.""
The numbers are from the USDA, are THEY "in the pocket of "big corn".
thanks, my suv could use some help
“That’s because I’m on the board of directors of Earth Biofuels, a Dallas-based producer of fuels including ethanol and biodiesel.”
and that’s why your entire article is a steaming pile.
If biofuels were so great the producers wouldn’t spend all their time try to suckle at the federal teat. But biofuels are nothing but a destructive waste of money extorted from taxpayers.
And anyone calling himself a conservative who supports this boondoggle is deluded or a liar.
No, I obviously didn't. My fact is a fact independent of that additional information.
If you increase the demand (and cost) for an item, it will put upward price pressure on substitute products. When you reduce the supply of a commodity, by shifting into some other use, you increase the price.
I never contended that this fact was the only influence on prices of corn. And obviously a shift to ethanol is not the only influence on the supply of corn for food. But moving a percentage of corn from the food supply to energy production decreases the availability of corn for food, and increases the price for corn and substitute items proportionally.
That is a fact. It's effect can be aggravated or mitigated by other factors that affect supply, such as an increase in production. Obviously.
Of course, the first thing people do as they emerge from poverty is improve their diets. They can afford to buy food now, so they do. That’s what’s really driving up the price of rice.
So all these people lept into the middle class last year and it just happened to coincide with an insane rush to bio-fuels?
Be careful with that acetone. It is highly flammable (hence it’s usefulness) and may cause cancer in lab rats. So keep your lab rats away from the acetone........
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