Ethanol: Clear and Present Danger

by William Yeatman on February 14, 2008 · 2 comments

CEI has long warned that the fuel-from-food craze threatens the world’s poorest citizens by making it harder for them to feed themselves. If you are unacquainted with the economics of ethanol and global food stocks, the causal chain is simple: more food for fuel means less for food, which increases the price of food.

Unfortunately, we were right. Javier Blas, in today’s Financial Times, reports that global food consumption will drop this year—despite a growing population—due to record food prices.

When people get hungry, they get angry, which is why I have argued elsewhere that America’s boneheaded ethanol policy has national security implications. In an age of international terrorism, chaos is a threat. Already, rioting has broken out in Indonesia and Mexico over soaring food costs. Expect more of this.

Al Fin February 14, 2008 at 1:37 pm: I wonder if the issue is really "fuel from food" or simply farmers selling to the highest paying market? Corn and soybean biofuels are not very economic, and would die out themselves if not for government subsidies, tariffs, and and incentives. So the real problem is government interference in the markets.
But biofuels such as algal biodiesel and biopetroleum, and especially biomass combined heat and power, will provide a very useful homegrown supplement to other energy sources.
Jatropha curcus is a seed oil shrub crop that is not a food at all–the oil is inedible, yet is probably the best quality biodiesel foodstock currently available. Far from taking away from cropland, jatropha actually improves the quality of topsoil and can be grown in among the crops with multiple benefits.
The problem with many of the web outbursts against biofuels, is that they are fighting the last war. Corn ethanol was obsolete before it was even implemented. It is government lunacy and always has been.
The only thing I ask is that criticisms be specific. Overly broad criticisms can set prejudices in people's minds against approaches to biofuels that in the long run will pay off.