OT - Will US Ethanol Mandates Trigger global food riots?

[Anonymous]

We told you guys this ethanol obsession would have grave unintended consequences.....

http://www.kottke.org/06/11/ethanol-corn-and-mexico

http://online.wsj.com/public/article/SB116260858542413472-w9jgHfcHYup_AP1_vzcXOFy5Av4_20071103.html

So far, about 20% of the US corn crop is going for ethanol production.  With new plants being built as we speak, that should rise to 30% of the US corn crop.  It's already cutting into the export market, with more to come......

Meanwhile down south of the border, Mexico has to import much of it's food staple from the US.  Now inflation is beginning to rear it's ugly head over those folks who have little in the way of discretionary income to absorb increases in food costs.

What do you think will happen in the near future?  Demonstrations, riots, socialist upheavel, more Hugo Chavez types obtaining power, more blame being put on the US for the world's problems.....

Meanwhile, we have all this coal in the ground that can be converted to transportation fuels cheaper than what it costs to produce ethanol from corn, but since coal is "dirty" and CO2 regs are apparently coming to the fore, it is becoming less likely that we'll be able to develop these resources in a price neutral manner.  Ditto for our undeveloped petroleum resources.......

For what it's worth, since ethanol is one of those so-called *renewables* being pushed by environmentalists, can we this time please connect the dots and chalk this one up to yet another case of the unseen cost of environmentalism?

[CAZEPHYR]

We told you guys this ethanol obsession would have grave unintended consequences.....

http://www.kottke.org/06/11/ethanol-corn-and-mexico

http://online.wsj.com/public/article/SB116260858542413472-w9jgHfcHYup_AP1_vzcXOFy5Av4_20071103.html

So far, about 20% of the US corn crop is going for ethanol production.  With new plants being built as we speak, that should rise to 30% of the US corn crop.  It's already cutting into the export market, with more to come......

Meanwhile down south of the border, Mexico has to import much of it's food staple from the US.  Now inflation is beginning to rear it's ugly head over those folks who have little in the way of discretionary income to absorb increases in food costs.

What do you think will happen in the near future?  Demonstrations, riots, socialist upheavel, more Hugo Chavez types obtaining power, more blame being put on the US for the world's problems.....

Meanwhile, we have all this coal in the ground that can be converted to transportation fuels cheaper than what it costs to produce ethanol from corn, but since coal is "dirty" and CO2 regs are apparently coming to the fore, it is becoming less likely that we'll be able to develop these resources in a price neutral manner.  Ditto for our undeveloped petroleum resources.......

For what it's worth, since ethanol is one of those so-called *renewables* being pushed by environmentalists, can we this time please connect the dots and chalk this one up to yet another case of the unseen cost of environmentalism?

Brazil is using Sugar Cane to make their fuel, not corn like we are using.  Sugar Cane can be raised in many warmer states and will be probably used in lieu of corn or as a replacement for corn in some areas.

Ethanol is renewable but we do not have a sufficient corn capacity to switch to ethanol for everyone in the states.

As far as riots, the other countries that need to consider growing crops also and not complain about our own use of one of the products we can grow.  Our farmers have received a price for corn that had not changed for the last thirty or so years until Ethanol began buying up the crops and the price began to rise.  This is not going to be easy for us or any other country to give up on oil, since we cannot drill on our own coastal or reserve areas by our own rules and laws.     

Maybe our lawmakers could mandate the BNSF and UP to use coal again since they both had much in reserve for many years.  Ha!  Ha!    The locomotive drawings are still available but the smoke ordnances laws would have to be changed.  

 

And if they want to exchange oil for our corn, then it might be a good thing like Matha always says.

[tomikawaTT]

Just saw a bit on TV about the new trend in ethanol production - which uses everything from the corn plant EXCEPT the edible kernels.  Not many people are likely to complain that we aren't selling them our cornstalks, husks and chaff!

IMHO, the reason for so many people blaming the U. S. for all their problems is that for too many years we've been working so hard to try to solve everybody's problems.  Now we catch the devil when the U. S. doesn't jump right in to pull somebody's chestnuts out of the fire - especially when we didn't put them there in the first place. 

There are a lot of agricultural products which make good feed stock for ethanol production, and lots of people can get into it with very little investment.  All of the moonshiners are small scale ethanol producers - except that they drink it instead of running IC engines with it.

Chuck

[Poppa_Zit]

They're in the middle of a Tortilla Crisis down there -- prices have tripled since last summer. Here in Chicago, prices are up 40 percent in the last two weeks. Oy!

Corn for oil -- I like the sound of that.

Tortilla crisis stories

[Datafever]

And just how did so many countries become dependent upon the largesse of the United States?

[beaulieu]

Interesting, as the Doha round of trade talks foundered because the US and Europe would not eliminate Farm subsidies. The poor nations said they couldn't compete. now the price of food goes up, where is the low cost competition. The Ethanol boom has taken the US corn production out of the world's food supply and suddenly the Third world countries can't make up the difference?

[jeaton]

Well...  It's good good for the survivalist supply business. 

[rvos1979]

Guess we'll have to get the farmers to convert to 400bu./acre corn. (It's been done, read an article on it a few years ago)  Last year my dad got almost 200bu./acre, which is considered good, and it was a wet year.

[Andrew Falconer]

The proper way to use corn is for Bio-fuels and for poultry feed. Shift the use of corn from being just a food filler to being a more valuable product.

 

Corn must no longer be a filler ingredient for cat food and dog food. Cats and dogs are always much healthier eating food with vegetables like sweet potatoes and peas. Poultry should be among the main ingredients in cat and dog foods, not corn.

Poultry is the only livestock that can properly digest corn.

Four legged herbivores have a much healthier digestive system when they eat grasses and green vegetables. The corn allows bacteria that are harmful to humans to build up in their digestive system. The cattle need to ingest grasses to clear the harmful bacteria, like e-coli.

Fast food producers can also reduce their reliance on corn products. Corn syrup variations do not need to be in so many food products. People can survive without a deluge of High Fructose Corn Syrup in their bodies. People who have developed conditions like diabetes can not have all that Corn Syrup in their system.

The price the for corn is increasing as more is being used for Ethanol and Bio-diesel production.

The land where crops have been grown is now being developed or is proposed for development. Corn supplies are limited by many factors and having less land does not help increase the supply.

Mammals do not need so much corn in their diets.

Bio-fuels made from corn are needed for autos and trucks.

The demands of new transportation fuels must be met with decisive action.

Andrew

[edblysard]

Actually,

Mexico and most of South America already have two big cash crops...cannabis and poppies... and a fairly large market north of the border, if the DEA figures are correct.

[spokyone]

Poultry is the only livestock that can properly digest corn.

Mammals do not need so much corn in their diets.

Andrew

Gosh Andrew. I don't know how I am going to break this news to my neighbor's cows and pigs.

[Anonymous]

Four legged herbivores have a much healthier digestive system when they eat grasses and green vegetables. The corn allows bacteria that are harmful to humans to build up in their digestive system. The cattle need to ingest grasses to clear the harmful bacteria, like e-coli.

 

But range fed beef is so yuckie, compared to corn fed. 

[greyhounds]

I don't know about global food riots - but ethanol is making things rough for US hog farmers.

http://us.f811.mail.yahoo.com/ym/ShowLetter?MsgId=8121_20928878_1091864_1619_9263_0_52484_23068_3784225403&Idx=116&YY=57603&y5beta=yes&y5beta=yes&inc=25&order=down&sort=date&pos=4&view=&head=&box=Inbox

There's your projected price of corn.  Get ready for expensive bacon.

[Anonymous]

Ethanol sucks big time. It may be cleaner but it does nothing for gas milage. I burn 10 times more gas with this ethanol junk than Regular gas.

[Anonymous]

I heard that if you remove all the subsidies from ethanol, and remove all the taxes from gasoline, ethanol would be over $3.00 per gallon, and gasoline would be under $1.00 per gallon. 

Add to that, the fact that ethanol has less B.T.U.s per gallon than gasoline, so ethanol yields considerably less miles per gallon than gasoline. 

I like how we are always treated to news coverage of people filling their tanks with ethanol while they brag about how much money they are saving.

[Andrew Falconer]

I was just painting a picture of what will happen in the future.

Andrew

[SactoGuy188]

Of course, I think people are kind of discounting how technology will overcome the issues raised in the article with two different methods.

The first is extracting ethanol from plant cellulose, which essentially means using the entire plant to make the fuel. Thanks to recent breakthroughs in using certain types of bacteria to break down plant cellulose into a form that can be refined into ethanol, that means we can process all that plant waste into ethanol, essentially increasing ethanol output by 150% or more.

The second is using the dry "waste" from oil-laden algae processed into biodiesel fuel to convert into ethanol. A company called GreenFuel Technologies is working on this idea, and that could drastically increase ethanol production to a huge scale.

 

 

[Tharmeni]

I hope I can get to the point some day when I can drum up things to worry about. 

We have scads of idle land - more corn can be planted.  We can all switch to hybrids, which sip, rather than gulp fuel.

Finally, other nations can be instructed on how to increase crop production...and feed their own populations.

The article reminds me of a journalist looking for an issue on a slow day.

Sorry fellas, this is just not on my worry list. 

 

[MichaelSol]

Four legged herbivores have a much healthier digestive system when they eat grasses and green vegetables. The corn allows bacteria that are harmful to humans to build up in their digestive system. The cattle need to ingest grasses to clear the harmful bacteria, like e-coli.

Corn is a grass. The type of corn used for livestock feed is planted densely, generates few ears -- less than one per plant -- and is generally harvested prior to the ears even ripening. No one raises corn to feed livestock because of the corn kernels. It is a C-4 grass that generates substantial carbohydrate biomass compared to other temperate zone grasses or, in particular, alfalfa. Makes a good silage which cows and hogs like to eat.

 

[Anonymous]

Guess we'll have to get the farmers to convert to 400bu./acre corn. (It's been done, read an article on it a few years ago)  Last year my dad got almost 200bu./acre, which is considered good, and it was a wet year.

An interesting thought - use GMO corn for ethanol production.  Isn't it the GMO stuff that gets the high yields?  And none of those corn importing nations want our GMO corn anyway!

[eastside]

I've seen that hysterical, attention grabbing story-line repeatedly in the past several weeks and just can't buy it.

It attempts to draw a direct cause and effect relationship between the demand for ethanol in America and third-world political instability -- a real stretch in my mind.  The chain of reasoning is too long and has too many tenuous links, both political and economic.  The most obvous: first, if the price of maize rises too much, the politicians can allow the importation of Brazilian sugar, a far more efficient feedstock for ethanol.  Second, high maize prices make the use of competitive processes such cellulosic processes, which are currently being perfected and thus uneconomical, economical.  Third, with the effect of American agricultural subsidies removed, farmers in the third world would be able to compete.  Worst of all, the scare-scenario assumes that other developed countries can't fill the void left by the American farmer.

Here's a more likely scenario to me:

1.  The American economy cools significantly
2.  The price of oil falls below $40
3.  Many alternative energy schemes become uneconomical
4.  Investors realize that there's too much ethanol capacity and ethanol's price crashes
5.  The price of maize retreats or stabilizes

[BaltACD]

US Agri-business has the ability to grow any crop to the level that makes a profit for it's producers.  Historicall agricultural interest have overproduced for the market and the excess has been sold a below market prices....just to move it to free us storage space for the next years crop.  So now the rest of the world has to pay market value for the product.  TOUGH!

[jeaton]

Anyway, if corn becomes too expensive, let them eat wheat.

[SactoGuy188]

Anyway, if corn becomes too expensive, let them eat wheat.

Also, rice could also be used to make ethanol since much of rice is made of starch, which can be chemically broken down into ethanol using modern technology. Mind you, in tropical regions it would be better to use sugar cane, though. 

 

[Anonymous]

I think that if you get a country with the economic power of the U.S. to subsidize a particular ag crop to the extent that is necessary to convert that crop into a plentiful fuel, you will see a gigantic price inflation on the whole market for that crop.  And the whole market means the whole world.  Because so much of that world is comparatively poor, they will be doubly affected by U.S. inflation of their corn staple price.  It will not look good to see this third world hardship, knowing that it is to satisfy the U.S. greed for oil.  It might end up being one of those unintended consequences of being green.

[Anonymous]

Where railroads come into play, wasn't it something like they are losing 2.5 hopper load equivalents for every 1 tanker car they gain if indeed that difference is being subtracted from the export corn markets?  Since most ethanol plants are being located amidst corn growing areas, it seems most inputs will come by truck on the shorthaul.

Anyone have the stats on export grain deliveries this past year?

[Anonymous]

Anyway, if corn becomes too expensive, let them eat wheat.

Ever eaten one of them whole wheat tortillas?  Bleah!

[pmsteamman]

Global food riots? Gosh folks its legal MOONSHINE!!!!!!

[rvos1979]

Global food riots? Gosh folks its legal MOONSHINE!!!!!!

Just don't try drinking any of it--unless one likes a gasoline chaser!!

[greyhounds]

Four legged herbivores have a much healthier digestive system when they eat grasses and green vegetables. The corn allows bacteria that are harmful to humans to build up in their digestive system. The cattle need to ingest grasses to clear the harmful bacteria, like e-coli.

Corn is a grass. The type of corn used for livestock feed is planted densely, generates few ears -- less than one per plant -- and is generally harvested prior to the ears even ripening. No one raises corn to feed livestock because of the corn kernels. It is a C-4 grass that generates substantial carbohydrate biomass compared to other temperate zone grasses or, in particular, alfalfa. Makes a good silage which cows and hogs like to eat.

 

Just wanted to make sure this one wasn't deleted.