jeaton wrote: By the way, some interesting points about grain prices and food prices and the cause for the increases. I think cash prices for wheat have gone through the roof. I can't see a connection between that and ethanol production. Am I wrong?
By the way, some interesting points about grain prices and food prices and the cause for the increases. I think cash prices for wheat have gone through the roof. I can't see a connection between that and ethanol production. Am I wrong?
Thanks to Chris / CopCarSS for my avatar.
jeaton wrote:By the way, some interesting points about grain prices and food prices and the cause for the increases. I think cash prices for wheat have gone through the roof. I can't see a connection between that and ethanol production. An I wrong?
By the way, some interesting points about grain prices and food prices and the cause for the increases. I think cash prices for wheat have gone through the roof. I can't see a connection between that and ethanol production. An I wrong?
It seems to me if farmers divert more and more land to the corn (cash) crop, the supply of wheat is jeopardized, so the price goes up.
jeaton wrote: oltmannd wrote:Yes, it should burst. We're choosing to pump the Ogalala aquifer dry instead of pumping Saudi oil wells dry. Great choice.The Ogalala aquifer was being pumped dry long before ethanol was being used for anything but a stiff drink.
oltmannd wrote:Yes, it should burst. We're choosing to pump the Ogalala aquifer dry instead of pumping Saudi oil wells dry. Great choice.
The Ogalala aquifer was being pumped dry long before ethanol was being used for anything but a stiff drink.
OK. I should have added "faster".
-Don (Random stuff, mostly about trains - what else? http://blerfblog.blogspot.com/)
Just for the record, I don't believe that ethanol is the be all end all of the search for cheap fuel, and anybody that says so is blowing smoke.
If we are to be prepared for a future decline in petroleum oil, either the natural "running out" or interuptions do to political "actions" (wars or production boycotts), I think we need to be developing a wide range of options. On the energy source front, that means wind, solar, biomass, and something using coal.
On the consumption side, that means continuing to develop and make use of technology directed at reducing the energy required to meet the end needs. Improved mileage performance on transportation vehicles is part of that mix, along with other more efficient devices for the production of heat, lights and mechanical power. (One might include good old fashion conversation in that mix. Turn off the lights, turn up the setting on the AC and walk or ride a bike.)
On the transportation front, it seems to me that we should be doing a much better job of deciding which mode should be used where. For any given need, rural, suburban, or city, long distance or short haul, rail, highway or air, or a mix of two or more could mean a more over all efficient transportation system. Include there intermodal coordination. Must driving be the only way to get to and from an airport terminal? That is the only method for most of our big airports.
"We have met the enemy and he is us." Pogo Possum "We have met the anemone... and he is Russ." Bucky Katt "Prediction is very difficult, especially if it's about the future." Niels Bohr, Nobel laureate in physics
I have heard that, that the big problem with ethanol long-term may be how much water it uses, not how much corn or grain. Even here in the "land o' lakes" there have been serious objections raised to the amount of water being used by ethanol plants in Minnesota.
The same thing was happening in the Texas panhandle 30+ years ago. I was visiting the family of a girl I was seeing at the time and her father was showing me a well casing that had been pulled up, explaining how it indicated just how far that particular aquifer had dropped since the well was put in. Time has obliterated the details, but based on his explanation, the drop was significant.
Larry Resident Microferroequinologist (at least at my house) Everyone goes home; Safety begins with you My Opinion. Standard Disclaimers Apply. No Expiration Date Come ride the rails with me! There's one thing about humility - the moment you think you've got it, you've lost it...
ndbprr wrote:I have read several articles now about farmers making good money. One guy replaced a red pick up truck that was two years old with a new one and wanted the same color so people wouldn't notice. Ag equipment sales are up. I understand your logic but it isn't only corn flakes. It is meat prices also. Beef, pork, chcken, turkeys. The price of all of them is rising becasue of feed prices. Besides, I hate corn flakes.
New equipment sales are up some, but not a lot, at least in this area, as most farmers are just replacing old almost wore out equipment with newer good used stuff. Some are choosing to do a seasonal lease on new tractors n such rather than buying.
Most farmers contract sale 50% to 60% of their crop in the spring, the rest on the day's market on the rest. I think the wife's uncle said he contracted part of last years corn at $3.50. Cash market was around $4.85 when he delivered, so he's out $1.35. He did buy out his soybean contract when the price doubled.
As far as the meat prices, again go back to the CBOT. The weaker dollar has help increase export demand there too
inch
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solzrules wrote: Yes. It should burst, but I don't think it will. It is a government mandate, and that is what created the demand in the begining. It sure wasn't the market. This mandate is seriously screwing with our economy in all kinds of idiotic ways, and it will not go away anytime soon. The housing market, which in the last 3 or 4 years has been completely unrealistic, finally took a dump because reality caught up with people. You can't charge 1 million bucks for a 2 bedroom 1 bath house in CA when people are not earning the wage to pay for it. Creative financial loans prolonged the correction, but the correction arrived all the same. Now just imagine what would happen if big ol hill got her way and froze forclosures? How many banks would continue to loan money when they have no hope of recouping cost if the loan defaults? Our government is preparing to tinker with our economy in an effort to make everyone happy and the result will be mass misery. Ethanol is a perfect example of that, and you watch-the mortgage industry will be the next disaster. Instead of letting the market work itself out, we'll have barackohillarain solving all of our problems - by creating new ones.
Yes. It should burst, but I don't think it will. It is a government mandate, and that is what created the demand in the begining. It sure wasn't the market. This mandate is seriously screwing with our economy in all kinds of idiotic ways, and it will not go away anytime soon. The housing market, which in the last 3 or 4 years has been completely unrealistic, finally took a dump because reality caught up with people. You can't charge 1 million bucks for a 2 bedroom 1 bath house in CA when people are not earning the wage to pay for it. Creative financial loans prolonged the correction, but the correction arrived all the same. Now just imagine what would happen if big ol hill got her way and froze forclosures? How many banks would continue to loan money when they have no hope of recouping cost if the loan defaults? Our government is preparing to tinker with our economy in an effort to make everyone happy and the result will be mass misery. Ethanol is a perfect example of that, and you watch-the mortgage industry will be the next disaster. Instead of letting the market work itself out, we'll have barackohillarain solving all of our problems - by creating new ones.
Are you saying the housing thing was caused by government mandates?
And how many banks would contunue to loan maney when they have no hope of recouping the cost if the loan defaults? Seems to me that up until a few months ago, their weren't many banks that even gave that any thought.
I do realize the energy input to manufacture Ethanol might be a bit more than we recieve from it.
If you listen to a study done by a Cornell Professor, yes. But remember his study was done using old data, and outmoded plants and farming practices. Using a model with current technology, and farming practices, there is a net gain in energy. Especially those plants which use bio-mass or coal as a source.
tree68 wrote: IIRC, in a thread about containers there was something about said containers headed back full of grain. I seem to recall reading somewhere that we are exporting a lot of grain these days, too.I know the cost of my dogs' food has risen by over a third in the past year or so, and sunflower seed has also gone up quite a bit.
IIRC, in a thread about containers there was something about said containers headed back full of grain. I seem to recall reading somewhere that we are exporting a lot of grain these days, too.
I know the cost of my dogs' food has risen by over a third in the past year or so, and sunflower seed has also gone up quite a bit.
Our export market in Grain has not slowed down at all in Iowa. Last year, we still exported more than we consumed. Ethanol accounts for only 25% of the current corn crop in Iowa. Even with the current round of plants now opened. As so far, almost 99% of the corn used to produce ethanol comes from local farmers, and not via railroads.
Oh and wind turbines? We plan on running more trains of them this spring. 148 will be built thirty miles south of me, addition to the 148 thirty miles west of me, and 280 nine miles north of me. Again, more investment in Rural America.
Murphy Siding wrote: solzrules wrote: It is a government mandate, and that is what created the demand in the begining. It sure wasn't the market. If you stop and think about it, that's the very same reason that PRB coal is big.
solzrules wrote: It is a government mandate, and that is what created the demand in the begining. It sure wasn't the market.
It is a government mandate, and that is what created the demand in the begining. It sure wasn't the market.
Ethanol replaced MTBE, first in Califorinia, then into the rest of the country.
Victrola1 wrote: The debate continues over the future of ethanol. Food prices are going up as more grain goes into gas tanks.
The debate continues over the future of ethanol. Food prices are going up as more grain goes into gas tanks.
Now onto this nonsense.
Ethanol has been a creature of political subsidy. If political will fades with food price unrest, etc. many doubt ethanol will survive. Other challenges may come from alternative fuels compatible with current petroleum pipe lines. What happens if the bubble bursts?
How can you blame ethanol producers for the price of corn? What about the CBOT? Don't they set that price? Do they have a realistic reason for setting that price so high? Let's look inside it for a moment. Most of the corn grown is for what? Animal feed. What is the byproduct of ethanol production? Animal feed. Show me the shortage there please. Cattlemen are taking as much of the byproduct as is produced, which turns out to be cheaper than whole grain corn. Much cheaper. Cattle lots close to ethanol plants use the wetcake which is even cheaper than dried. Again, where is the shortage?
Most of the ethanol moving long distance does so by rail. Are cars used to carry ethanol compatible with many other commodities? If ethanol dies, will there be glut of tank cars? Other than equipment, what other ripple effects on the rail industry should ethanol go bust?
Other than equipment, what other ripple effects on the rail industry should ethanol go bust?
Loss of revenue. Lots of it. And not just the railroads. Terminal operators will loose all that investment in unit train facilities. Contractors who do maintenance. The billions in taxes from the jobs ethanol has produced. It is a huge part of the rural economy. The railroads have a lot invested. Track uprgades which need to be paid for as well as the added capacity.
Those outside the rural areas of America really don't see the whole picture. They just see the knee jerk of places like the CBOT, which by the way, plays both sides of the game since they also trade in Ethanol futures as well, not to mention the food marketers who really stand to gain by increased prices.
And the estimated 18,000 tank cars that would sit idle, as well as 19,000 covered hoppers, would be a huge cost to to the leasing companies (built new since 2001).
mudchicken wrote: Windmills and ethanol have played their hands, time for the next and greatest "big idea".
diningcar wrote: Another thought unrelated to transportation is the depletion of nutrients in farm soil as growers plant only those crops which currently command high prices. They formerly rotated crops on the same piece of land and used that method to replenish nutrients the last crop utilized. To offset this loss fertilizers will be necessary which add expense and perhaps have other consequences.Some growers are already showing concern and have expressed it to me.
Another thought unrelated to transportation is the depletion of nutrients in farm soil as growers plant only those crops which currently command high prices. They formerly rotated crops on the same piece of land and used that method to replenish nutrients the last crop utilized. To offset this loss fertilizers will be necessary which add expense and perhaps have other consequences.
Some growers are already showing concern and have expressed it to me.
Where are you seeing this? The producers I talk with say they still rotate their crops between beans and corn. None of them have taken any acreage out of CRP either. One said, why should I add extra cost to my operation when beans are also getting a good dollar? Besides, he uses his neighbor's manure, so he really isn't out a whole heck of a lot of money for nitrogen.
I have spent the past couple of days back in the hometown. Farmland prices are thru the roof down here, above $6000 acre.
will the next bubble be farmland?ed
......Windmills are doing fine in the east where I come from and being quite productive. Many are up and running.
Quentin
(1) We have two pilot plants here in Denver that processes Colorado & Wyoming coal into Aviation fuel and diesel fuel. And then there is K-Fuel.
(2) One other thing you are not hearing is the problems with waste. (There is a reason why the ethanol plants are where they are)....
Windmills and ethanol have played their hands, time for the next and greatest "big idea".
....Love Corn Flakes. Only I find I eat them at night watching late night TV instead of in the morning.
....If we use fuel made from Ethanol, doesn't that replace the equivalent amount of oil we must inport from Opec.....? I wonder, if that is true just where the true cost might be.
I do realize the energy input to manufacture Ethanol might be a bit more than we recieve from it. Couldn't that energy input that's required be something we have plenty of....Coal...?
I also realize we get less BTU's out of Ethanol compared to gasoline....But if we manufacture it here we probably would have plenty of it to use.
I wonder if all the food prices we are seeing increasing and being blamed on Ethanol production {using corn, etc...}, is really the truth, or someone is getting greedy in the industry....and taking advantage of a situation and just blaming it on corn shortages.
I really don't know. I do know it would reduce imports from Opec and others and isn't that what we're trying to accomplish. Less dependent on others for our fuel. If we have corn shortages, is there room to plant so much more.....?
ndbprr wrote:Ethanol is a typical political solution to a complex problem. When mileage per gallon cost is figured correctly - even with the subsidy which we are all paying - Ethanol is still more expensive than gasoline. If 100% of the crops were turned to fuel it wouldn't amount to much any way. In the meantime food prices are soaring based on feed stock and demand. The question isn;t Should the bubble burst. the question is how fast it is going to burst.
Corn and soy are frequently rotated because soybean (and alfalfa) is a nitrogen-fixing plant and put more nitrogen into the soil then it removes, whereas most cereals are nitrogen consumers. If corn is the only crop grown, then nitrogen fertilizer in some form -- ammonia, UAN, urea -- will eventually be required. It's only a matter of money.
The losses that can't be made up so easily are topsoil erosion and consumption of fossil water for irrigation. Eastern Washington, which has a highly productive spring wheat, peas, lentil, and barley crop, is steadily losing acreage. Fossil water such as the Ogallala Aquifer, which is used to support corn, cotton, grain sorghum, and wheat in a broad band from Western Nebraska to the Texas Panhandle, is being consumed rapidly, and when it's gone, dryland farming or grazing will be all that's feasible.
RWM
diningcar wrote: Another thought unrelated to transportation is the depletion of nutrients in farm soil as growers plant only those crops which currently command high prices. They formerly rotated crops on the same piece of land and used that method to replenish nutrients the last crop utilized. To offset this loss fertilizers will be necessary which add expense and perhaps have other consequences.
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