Whistler, I don’t see that number, but here is their comment, which amounts to a recapitulation of “standard wisdom”:
Ethanol accounts for some of the rise in the prices of other crops and foods too. Partly this is because maize is fed to animals, which are now more expensive to rear. Partly it is because America’s farmers, eager to take advantage of the biofuels bonanza, went all out to produce maize this year, planting it on land previously devoted to wheat and soyabeans. This year America’s maize harvest will be a jaw-dropping 335m tonnes, beating last year’s by more than a quarter. The increase has been achieved partly at the expense of other food crops.
This latter is the same false claim that other people have made, who haven’t gone back and looked at the actual production numbers. Any decrease in US production have not been associated with less land planted, but with poor weather the last year.
And keep in mind, this is 1/3 of US corn according to this article. Since 50% of that gets recovered in feed stocks, that means 1/6 of the US corn supply is affected. What percentage of global agricultural activity does that represent?
Again, I’m not arguing the viability question here, just like Pom, I’m merely pointing out this is typical media hype written by reporters too lazy to research their own stories.
Carrick - 05:05am on 05/12/2008
Those numbers are in the sixth paragraph under the graph.
The Whistler - 06:05am on 05/12/2008
If ethanol is a legitimate energy source, it should be viable in a free market, sans subsidies.
Kevin, I agree, with caveats. Startup costs and capital is an issue. Nuke plants would be a case in point. However, if they get money from the guvmint to just do a rehash of the same design that’s been in use for 4000 years, I’m ticked! I want full passive solar plant with robotic workers for the money we’re putting into this!
FlyOnTheWall - 06:05am on 05/12/2008
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.
Carrick - 06:05am on 05/12/2008
Sorry I meant to say “ I tend to accept the studies that suggest that currently ethanol is nota ‘major cause’ of the surge in food prices.”
Carrick - 06:05am on 05/12/2008
From the article, I note that Schafer is pretty harsh on the current farm bill and on subsidies in it for rich farmers (corporate owners mostly). Good for him.
Carrick - 06:05am on 05/12/2008
“ I tend to accept the studies that suggest that currently ethanol is not a ‘major cause’ of the surge in food prices.”
For something like food that is only minimally overproduced a small decline in production or shipping can create a drastic short term problem. It’s impractical and expensive to store large amounts of rapidly decaying food around for emergencies, any excess is wasted.
IMO we’re seeing a few minor and not so minor blips adding together to create horrible problems in borderline areas (coincidently non-democratic.) With food production, it’s doubly bad because that takes 2-5 seasons to work out.
It finally came up, so here’s the link directly.
Whistler, I don’t see that number, but here is their comment, which amounts to a recapitulation of “standard wisdom”:
This latter is the same false claim that other people have made, who haven’t gone back and looked at the actual production numbers. Any decrease in US production have not been associated with less land planted, but with poor weather the last year.
And keep in mind, this is 1/3 of US corn according to this article. Since 50% of that gets recovered in feed stocks, that means 1/6 of the US corn supply is affected. What percentage of global agricultural activity does that represent?
Again, I’m not arguing the viability question here, just like Pom, I’m merely pointing out this is typical media hype written by reporters too lazy to research their own stories.
Those numbers are in the sixth paragraph under the graph.
Kevin, I agree, with caveats. Startup costs and capital is an issue. Nuke plants would be a case in point. However, if they get money from the guvmint to just do a rehash of the same design that’s been in use for 4000 years, I’m ticked! I want full passive solar plant with robotic workers for the money we’re putting into this!
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 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.
Sorry I meant to say “ I tend to accept the studies that suggest that currently ethanol is nota ‘major cause’ of the surge in food prices.”
From the article, I note that Schafer is pretty harsh on the current farm bill and on subsidies in it for rich farmers (corporate owners mostly). Good for him.
For something like food that is only minimally overproduced a small decline in production or shipping can create a drastic short term problem. It’s impractical and expensive to store large amounts of rapidly decaying food around for emergencies, any excess is wasted.
IMO we’re seeing a few minor and not so minor blips adding together to create horrible problems in borderline areas (coincidently non-democratic.) With food production, it’s doubly bad because that takes 2-5 seasons to work out.