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How Biofuels Could Starve the Poor
C. Ford Runge and Benjamin Senauer, Foreign Affairs
Summary: Thanks to high oil prices and hefty subsidies, corn-based ethanol is now all the rage in the United States. But it takes so much supply to keep ethanol production going that the price of corn — and those of other food staples — is shooting up around the world. To stop this trend, and prevent even more people from going hungry, Washington must conserve more and diversify ethanol’s production inputs.
C. Ford Runge is Distinguished McKnight University Professor of Applied Economics and Law and Director of the Center for International Food and Agricultural Policy at the University of Minnesota. Benjamin Senauer is Professor of Applied Economics and Co-director of the Food Industry Center at the University of Minnesota.
Castro: US to Starve World
Prensa Latina (Castro)
Cuba s President Fidel Castro denounced on Wednesday that the United States internationalizes genocide with its energy policy, in an article published by “Granma” newspaper.
Where and who are going to supply over 500 million tons of corn and other cereals that the United States and wealthy countries need to fill the ethanol demand? he asked.
He said the five main producers currently supply 679 million tons to the world market for food, according to recent data, while the five main consumers, some of which also produce those grains, currently need 604 million tons annually, so the available surplus is less than 80 million tons.
That colossal waste of cereals to produce fuel, without including oily seeds, would only be used to save wealthy nations less than 15 percent of the annual consumption of their voracious cars.
“Several nations,” noted the island s statesman, “do not produce hydrocarbons, nor can they grow corn and other grains or oily seeds, because water does not cover their most elemental needs.
Reflecting in this second article on the issue, Fidel Castro warned that the worst thing is still to come: a new war to ensure gas and oil supplies, and place the human species on the verge of total holocaust.
In this sense, he recalled mass media already alerts that the US has been readying the war against Iran for over three years, since the day it decided to totally occupy the country.
The head of State stated that many countries attribute the oil price of almost $70 per barrel, reached on Monday, to the fear of an attack on Iran.
In his conclusion, President Fidel Castro reflects on from where will poor Third World countries obtain the minimum resources to survive.
(4 April 2007)
Related articles at
BBC and Associated Press.
Castro’s original text in Spanish.
UPDATE: Just found Castro’s speech in English.
Monsanto 2Q Profit Boosted by Corn Sales
Christopher Leonard, Associated Press
Monsanto Co., the world’s largest seed company, said Wednesday a booming market for corn-based ethanol has fueled its corn seed sales and boosted profits by 23 percent in the second-quarter. … The results topped Wall Street expectations.
Chief Executive Hugh Grant said corn sales were clearly the standout segment. “We’re thrilled with he performance of our corn seed business,” Grant said.
Corn seed sales surged 47 percent to $1.19 billion, from $811 million, amid a boom in production of ethanol, a fuel which in this country is made largely from corn.
But farmers’ switch to planting more corn this season isn’t all good news for Monsanto. The company also depends on cotton and soybean sales, which have been hurt by corn’s rise.
(4 April 2007)
Fertilizer shortage will hit farmers this spring
A Saskatoon commodity analyst says a large number of farmers planting corn for the ethanol market could put a strain on the fertilizer supply for Prairie farmers this spring.
Larry Weber says farmers are planting record amounts of corn, which has created an unprecedented demand for fertilizer.
That could result in a shortage in Western Canada, he said.
“It’s going to be very difficult, if you haven’t already purchased fertilizer yet, going forward, to buy fertilizer,” Weber said.
(3 April 2007)
Contributor Rick Lakin writes:
We reach limits on available petroleum for gasoline, we use ethanol. We reach limits on Ethanol, we grow more corn. We grow more corn and we reach limits on Fertilizer. We manufacture more fertilizer and we reach limits on natural gas. We are getting to the point where Peter will not have any left for Paul.
The cob-smacking truth about the cost of ethanol
Colin Carter, Globe & Mail
Agriculture in North America has abruptly moved into the business of making energy, mostly corn-based ethanol, a renewable fuel. Canadians are caught up in the boom, but they may be surprised at the effect the ethanol rage will have on their wallets at the grocery store as food use of corn faces strong, permanent competition from fuel use.
Grain corn is one of nature’s wonders and it happens to be the largest source of food in North America. Walk down any aisle in a supermarket and randomly pluck a food item off the shelf — chances are that it contains corn. Many ingredients in processed foods are corn-based. Corn is also an important source of livestock feed. Thousands of food items contain it, either as a direct ingredient (such as corn chips) or indirectly from a corn-fed cow or chicken (such as milk). We complain now about the cost of filling our cars with gas; we may soon be complaining about filling our bodies with food.
The United States is by far the world’s largest supplier of corn. Canada imports about 20 per cent of its needs from the United States because the northern climate is less ideal for corn production.
The price of corn in Canada is tied to the U.S. price, which means Canadian food will become more expensive as more and more corn is diverted for ethanol. Higher corn prices mean more land will be used for corn production and less for other crops, raising the price of other crops, such as soybeans. Higher corn prices may also result in reduced livestock production, as the cost of feed increases. The next time a drought hits the corn belt, livestock farmers will be the first to go broke and we will all take notice.
(4 April 2007)