Whistler, obviously that 60% number isn’t quoted directly, so can you explain how you arrived at this statement?

It appears that the total amount of corn diverted to ethanol production in the US is about 60% of the drop in the stockpiles.

Unless you are using this:

This year the overall decline in stockpiles of all cereals will be about 53m tonnes–a very rough indication of by how much demand is outstripping supply. The increase in the amount of American maize going just to ethanol is about 30m tonnes. In other words, the demands of America’s ethanol programme alone account for over half the world’s unmet need for cereals. Without that programme, food prices would not be rising anything like as quickly as they have been. According to the World Bank, the grain needed to fill up an SUV would feed a person for a year.

This argument as I’ve pointed out doesn’t fly, because it is assuming a zero-sum economics that certainly doesn’t apply at this point to agriculture, due to the availability of reserve lands that are currently being used.

Based on what I’ve read, grain prices would be going up regardless of whether the US had an ethanol program: increased demand and massive crop failure account for part of this. I tend to accept the studies that suggest that currently ethanol is a “major cause” of the surge in food prices. (I don’t use “food shortage” because that is mostly an artifice of media reporting, rather than an objective reality.)

That said it is fair to explore the effect of future growth in the ethanol industry, assuming that it survives the current spike in food prices. As I’ve pointed out in other comments, the model for corn for ethanol assumed the (now obviously flakey model) that food prices would remain at their 1990 lows.

Why do we have our shorts in a twist over ethanol subsidies? Aren’t Gov. subsidies designed to just get a product or an idea off the ground? like the CRP?

oh, wait….

at least with ethanol subsidies we get something on the other end.

we are providing subsidies for wind, coal, oil…you name it there is a program for it. I think there might have even been something in the pot for starting a fish farm….

Rob, If you want to go through their analysis and point out problems with it, that’s one thing. Otherwise you are just denying the conclusion in the absence of a quantitative counter argument.

However, nobody here, myself included, is arguing that we should do otherwise than reassess our current alternative energy policies. That includes corn subsidies that drive up corn prices, and ethanol subsidies to counter balance the increase corn prices associated with corn subsidies, import tariffs on Brazilian biofuel and so forth.

Whistler can you link where you get the 60% number from? That sounds way too high, if you consider total corn stocks, rather than just feed corn. I think the real number is closer to 10% (once you factor in that roughly 1/2 of the biomass used in ethanol conversion gets turned into a food source for cattle).

Finally, ultimately if you are to argue that corn for ethanol has supplanted other crops, you need to show in figures that they have materially affected our production of those crops (as opposed to e.g., cold weather or drought). US wheat production actually increased last summer in spite of the use of some farm land for corn for ethanol, and would have been even higher had it not been for drought.. Clearly that undermines any such argument.

Part of how that happened is the reduction by about 20% in the number of acres in the US conservation program (an area as I’ve pointed out currently the size of the state of New York). And part is rising demand for food have made more total acreage profitable to grow crops on.

My wifes family farms a significant amount. It has absolutely driven up the cost of corn. Why would he say this?

I have moderate confidence in Ed. I’ve seen him be brilliant, I’ve seen him stuff his head up his ass.

This appears to be the latter.

Is it a major cause? That’s the term he used. The other more important factors:

But Mr. Schafer said that rising energy prices, drought in key producing regions, and rising demand from developing countries such as China and India have played a far more significant role than ethanol, adding that those strains on the world’s food networks can’t be solved overnight.

Those are reasonable observations.

I despire ethanol subsidies as a policy, and it was definitely sold as a way to increase the price for farmers. So it IS a factor.

But I’m also very suspicious of this sudden “world food crisis” which wasn’t a topic even last year. We’re seeing another media craze, simplified reporting that tries to make the United States look bad.

Those numbers are in the sixth paragraph under the graph.

If ethanol is a legitimate energy source, it should be viable in a free market, sans subsidies.

the fact remains that fuel crops are taking up more land that could have been used to expand production to meet supply shortages.

For faithful supports of ethanol to deny this is for them to deny reality itself.

So says the guy who is denying the reality that Ed is saying it doesn’t. But Rob understands that he has the right to his opinion, but makes the mistake of confusing it with the idea that he has the right to his own facts….and that nobody else’s facts, matter.

Media craze or not, I think the concern being generated is warranted. Trying to fuel our energy needs with our food crops is lunacy, and defending such policies is a mistake.