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Ethanol Death Watch As Corn Prices Rocket

by Lloyd Alter, Toronto on 06.24.08
Science & Technology (alternative energy)

corn prices skyrocketing photo

John noted earlier that the floods on the Mississippi are going to wreak havoc on food prices this summer; They are not doing too much good for the ethanol industry either. According to Citygroup analyst David Driscoll, 3 out of 4 operating ethanol plants could be shut down in the next few months.

Earth2Tech counts 11 proposed plants that have been cancelled because financing was unavailable. As one expert on the biofuel scene said: “US ethanol producers are screwed." ::Earth2tech

TreeHugger on the Ethanol Debate
Green Basics: Ethanol
Corn Ethanol Worsens Gulf of Mexico 'Dead Zone'
Final Word on Ethanol's Efficiency as Vehicle Fuel
Ethanol : Eco-Labeled Yet Losing Luster Fast
Ethanol Follies in Upstate New York

Comments (11)

So why are farm subsidies still being paid? I've not got a finger on the pulse of this particular government boondoggle, but under current conditions it seems to me that there is no excuse for having a single government farm subsidy for any square inch of American soil: not just for actually growing food (which will clearly be needed soon, if not domestically then as a cash crop elsewhere), but for use in biofuel manufacture and for dealing with carbon dioxide. What's the word, team?

jump to top Perrin says:

“US ethanol producers are screwed."

It was a bad idea anyway. Once the crop gets back to normal, can we expect food prices to return to normal?

jump to top stradric [TypeKey Profile Page] says:

We're still gonna need some ethanol as the "oxygenate" added to gasoline (in California anyway) that replaced MTBE, unless regulations are changed...DB

jump to top Dan Brockman says:

It is interesting, as one that grows food for others, to hear the complaints from the folks that we are trying to feed, that our hard work and the risks that we take should not be rewarded well.

Food prices are rising, and we may come to the point where the family farm can once again support us.

Presently I have to drive over 25 miles to get to a job in the city. I put in a two to four hours a night in addition and work about 20 over the weekend. My wife does a lot of the work that I would like to be doing. All this to produce organic food so folks can eat well.

jump to top Uncle Mike says:

Uncle Mike, is the hard work you do and the amount of risk you assume somehow worth more than those of the tens of millions of people who manufacutre goods, provide services, and also contribute to the economy? Why can't farmers compete in a fair market like the vast majority of us? There's nothing inherently wrong with high prices, but there is something very wrong with the idea that farmers deserve some sort of special protection or extra reward just because they grow and sell food.

Right now a portion of my taxes (which I earn getting overworked and underpaid in a public sector job while living in a city nobody can afford) go to effectively maintain the skyrocketing prices on food which I have to pay for anyway. As an added bonus, poor people in the US and other countries go hungry. Farmers in developing countries - who could otherwise sell us the same food at lower prices - remain poor because they can't compete with over-subsidized agriculture in rich countries. Is this really worth it?

Somehow I doubt that you receive an overwhelming amount of federal subsidy. As a farmer who seems to have small- to mid-size holding, do you really benefit all that much from subsidies? Moreover, if you're selling premium goods - organics - do you need the help?

jump to top Angry Sam says:

Ethanol is a good idea. Corn ethanol is a bad idea, but it's been important in establishing the technology and the market for it, and then developing beyond it. We are on the verge of developing ethanol from cellusolic plants, which are way cheaper and more efficient than corn. So the key is to put money and subsidies into research and development and regulatory standards that favor cellulosic ethanol. Corn ethanol was dying anyway, but at least it may have paved the way for a much greener method of producing ethanol. It's certainly time to get rid of subsidies for corn, but let's ensure that this money gets put into research on better forms of ethanol, and better sources for cellulose, such as switchgrasses, hemp, etc. Also, of course, solar and other alternative energy technologies. No sense in saving money on corn subsidies if it only gets eaten up by the war in Iraq and other boondoggles.

jump to top conradg says:

Ethanol is a waste of resources. It takes nearly twice as many BTU's to produce than it will put out, plus it increases ground level ozone. Time to move on to something better like biodiesel.

I like ethanol, in fact, I'm drinking it right now. What a stupid idea to waste it on transportation!

I hate Monsanto for so many more reasons though.

jump to top Brian Clark says:

It's like always: where is the esteem for all the workers doing service for the society?

jump to top sikantis says:

No one can be really sure if ethanol or biodiesel from any source is really a good idea. Until it is proven to be cost effective and environmentally better on an industrial scale, please don't assume any fuels are really a solution. Remember the automobile, the environmentally sound alternative to the horse that has become the mother of all unintended consequences.

jump to top Richard says:

Corn based ethanol is not the total cause of the higher food prices. Do you all forget that not all food is based on corn? What about wheat and soybeans? Farmers are switching to wheat from corn because wheat is up so much. Another reason why corn has gone up. Also, the corn used in ethanol is not a food grade corn. After the alcohol is extracted, the protein rich feed stock that is left over is sold to farmers for feed. So don't blame ethanol for rising corn, food, and beef costs. It might be part of it of the reason, but not the total reason.

jump to top Pete says:

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