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Letters
Friday, July 4, 2008 12:00 AM

A biofuel food-price bombshell

The U.K. Guardian reports some astonishing numbers from a "confidential" World Bank study on energy crops and grain prices.

The letters thread is now closed.

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Friday, July 4, 2008 07:05 AM

Too Strong? No.

The facts seem to be: A rich country distorts the market at the behest of a few farm state senators and their huge agribusiness patrons in a way that causes hunger and sometimes starvation for millions. That strikes me has pretty criminal, actually.

And the number of thoughtful environmentalists who support corporate corn production for ethanol fuel is around zero (although there are probably a few outliers). There have got to be more efficient ways to produce energy than planting, fertilizing, spraying with pesticides, and harvesting a bunch of low efficiency solar panels.

Friday, July 4, 2008 06:48 AM

Biofuels are not the solution, they are simply a stop gap

That said though:

Biofuels require increasing the production of food on a worldwide scale. The thing is, that this means changing politics and cultural norms when it comes to dealing with the third world - particularly Africa.

There needs to be a stop to the indulgent concept of missionaries teaching Africans about subsistance farming. Subsistance farms aren't very effecient as a means of producing food at the best of times, and they guarantee famines when times are not at their best.

Further, the mechanism which allowed Africa to become so heavily indebted as its leaders invested the loaned money in things like guns, death camps and the latest Mercedes Benz, needs to be looked into.

Friday, July 4, 2008 05:26 AM

Crime against humanity seems a little strong...

Then we have to say that *any* agricultural production that is not for food is a crime against humanity. I hope you've never purchased cut flowers...

Then it's not too long to say that if you're not a vegetarian, you're committing a crime against humanity... After all, if you're eating meat, you're using up a lot more acres per calorie than if you're a vegetarian.

Let's keep the rhetoric under control, shall we? I happen to agree that corn-based ethanol is pretty stupid, but corn-based ethanol isn't the only player in the biofuel game, and saying that biofuels are a crime against humanity is not only over-the-top, it's a gross generalization in a field where there are *many* options that don't involve using corn.

Try googling "2nd generation biofuel" or even "3rd generation biofuel" some time, you may be surprised (and impressed) with what you find.

Friday, July 4, 2008 05:07 AM

Oh goodie...something else speculators can fuck us in the ass with

Gee, thanks.

Friday, July 4, 2008 04:31 AM

Point the finger at us

The people evangelizing and driving bio-diesel are mostly lefty environmentalists. I also know of at least one environmental organization that allied with agribusiness to promote ethanol. The article takes a swipe at the Bush administration, but it's not just their fault. It is our own.

Environmentalists care little about social equity, and place the burden on the world's poor. That inequity undermines long-term environmental goals.

No one wants to talk about reducing total resource use.

Friday, July 4, 2008 03:34 AM

Isn't it reassuring...

that the adults are in charge? Thank you again, GB. Another massive screw up occurring on your watch.

A question: What's going to happen next winter when many people in this country aren't going to be able to pay for heating oil for their houses? What then? Think about it.

Friday, July 4, 2008 02:15 AM

I speculate that...

...speculation has nothing to do with it. Krugman covered this territory recently with regard to oil prices, and in fact his argument works even better for perishables w/o in-ground storage. Where are all the warehouses bursting with stored grain, which these speculators are holding off the market? If they don't exist (and it should be pretty hard to hide that much grain), then how, exactly, is the futures price affecting the spot price?

-AK48

Friday, July 4, 2008 01:37 AM

@Rich_Gibson

In your haste to take umbrage, you exhibited a very poor level of reading comprehension.

The "crime against humanity" isn't the act of growing corn for fuel, it's when governments mandate that we should grow corn for fuel.

Obviously anyone ought to be able to see the problem with a government mandating such an action in a vacuum.

Thursday, July 3, 2008 10:46 PM

follow on to: Same model for fuel distribution, different fuel

I forgot to make one of my points (I might be a little drunk too...). I kind of bought into the feel good ads that BP did about "we are an energy company, and we will evolve to provide the energy of the future, blah, blah, ...". Well there are a few scenarios where delivering the energy of the future doesn't include any role for BP or the other big petroleum companies, and I'll bet that scares the hell out of them. So I think since their very survival depends on being part of the picture (whatever the "energy of the future" picture looks like) they will fight like any beast does when faced with the possibility of it's own demise - no holds barred.

Thursday, July 3, 2008 10:35 PM

Same model for fuel distribution, different fuel

Reading the columns and letters around biofuels/peak oil/electric cars that have been popping up lately I had a small epiphany. It occurred to me that the big petroleum companies would get completely cut out of the picture if we switched to electric cars where the batteries get recharged from plugin-type outlets, since the electric companies already have/own the grid that distributes the "fuel". But if we switch to any type of liquid fuel where you pull into your friendly corner filling station to refuel, then the petroleum companies simply need to do some upgrading to equipment to be able to distribute and sell that new fuel.

I suppose this might have already occurred to some of you, but to me this seems a bit of a revelation. The oil companies (which usually do refining and distribution too) are NOT going to just quietly fade into the sunset. They are going to do everything they can to push us into using some type of liquid fuel for cars, and from their point of view if it is petroleum based, then the upgrading might not even need to happen (oil from shale or coal or algae or plants).

Thursday, July 3, 2008 10:19 PM

I'm drunk

What I meant to say is that parking garages and public transit don't line the pockets of major donors (to both parties) like ADM, etc.

I gotta quit posting stuff when I'm drunk.

Thursday, July 3, 2008 09:35 PM

Confidential?

This is the item from the July 2 report. Bush wants to remove all the tariffs on biofuel from Brazil, right?

Head of the World Bank is Neo-conservative Robert Zoellick, who signed the 1998 paper advocating the invasion of Iraq.

Commit to re-examine policies towards bio-fuels in the G8 countries:

7. Agree on action in the US and Europe to ease subsidies, mandates and tariffs on bio-fuels that are derived from maize and oilseeds; accelerate the development of second generation cellulosic products.

[more]

Biofuels: The Promise and the Risks

World Development Report 2008: Agriculture for Development

Biofuel production has pushed up feedstock prices. The clearest example is maize, whose price rose by over 60 percent from 2005 to 2007, largely because of the U.S. ethanol program combined with reduced stocks in major exporting countries. Feedstock supplies are likely to remain constrained in the near term. However, unless there is another major surge in energy prices, it is likely that feedstock prices will rise less in the long term. Farmers will respond to higher prices by increasing the planted areas and supply of these feedstocks. At the same time, rising prices will lower the demand for feedstocks because of the falling profitability of producing biofuels at these higher prices.

Rising agricultural crop prices caused by demand for biofuels have come to the forefront in the debate about a potential conflict between food and fuel. The grain required to fill the tank of a sports utility vehicle with ethanol (240 kilograms of maize for 100 liters of ethanol) could feed one person for a year; this shows how food and fuel compete. Rising prices of staple crops can cause significant welfare losses for the poor, most of whom are net buyers of staple crops. But many other poor producers, who are net sellers of these crops, would benefit from higher prices.

Future biofuel technology may rely on dedicated energy crops and on agricultural and timber waste instead of food crops, potentially reducing the pressure on food crop prices. But second-generation technologies to convert cellulose from these waste products into sugars distilled to produce ethanol or to gasify biomass are not yet commercially viable—and will not be for several years. Moreover, some competition for land and water between dedicated energy crops and food crops will likely remain.

[and the environmental benefits]?

Potential environmental benefits. Environmental benefits need to be evaluated on a case-by-case basis, because they depend on the greenhouse gas (GHG) emissions associated with the cultivation of feedstocks, the biofuels production process, and the transport of biofuels to markets. And a change in land use, such as cutting forests or draining peatland to produce feedstock such as oil palm, can cancel the GHG emission savings for decades, according to the 2006 EU Biofuel Strategy.

[It looks like carbon trading is the only viable policy to balance the environmental harm, and GHG emissions.]

Perhaps they were hoping no one would read it.

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