Biofuel just got even more unpopular across the globe

Biofuel just got even more unpopular across the globe

Summary: I blogged recently about criticism of ethanol and other biofuels in some parts of the world. A meeting of over 180 national finance ministers with World Bank officials just gave the whole issue of food or fuel a much higher profile.

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TOPICS: Government, Banking
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I blogged recently about criticism of ethanol and other biofuels in some parts of the world. A meeting of over 180 national finance ministers with World Bank officials just gave the whole issue of food or fuel a much higher profile.

Political problems caused by hungry people in the streets has worried many governments around the world. One target of the blame: biofuel. Here's how the NYT put it: "Some ministers from poor countries, for example, are growing impatient with the way the West is addressing global warming by subsidizing and encouraging conversion of corn, sugar cane and other food products into substitutes for oil. The shift is helping to drive up prices, they say."

A Canadian take on the World Bank meeting, says there was much talk, no clear direction. "The finance ministers and central bank governors who oversee the International Monetary Fund and the World Bank left Washington yesterday without a definitive response to agricultural prices that have surged 48 per cent since the end of 2006, sparking a wave of hoarding and riots throughout the developing world."

Higher food prices, riots over starvation, haves vs. have-nots. This is making a Malthusian out of me.

U.S. Acts!

The U.S. government has leaped into action on the starvation issue. President Bush has ordered two hundred million dollars to be used to buy food for needy nations. We're not giving food, just money. So all those folks in the agribusiness world will still get their mighty profits and none of the profit-first crowd have to worry that somehow the American government is going short-circuit the marketplace where all good things are known to grow. I'm sure Milton Friedman and all the prophets of profit can rest easily in their graves tonight. People may be starving but free enterprise will win out. And not a single ethanol plant will curtail its production across the American corn belt. And Brazil will continue to turn sugar cane into fuel. French rapeseed will become biodiesel fuel.

The White House wants you to know that the President and his Cabinet spent considerable time discussing the hunger thing.

A little perspective on the $200 million we Americans are giving away. More than most bloggers can make in a good year. That's a lot of money compared to the revenue of a small grocer in America. Nothing compared to the big chains' revenue. Just slightly more than the U.S. currently spends PER DIEM in Iraq.

Topics: Government, Banking

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26 comments
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  • biofuels is the latest political scam

    throwing subsidies in our fuel tank and giving more reasons to countries to exercise population control is the way we will defend our interests overseas. If we play it smart we might be able to get some leverage against the middle east thugs and even China.
    Linux Geek
  • RE: Biofuel just got even more unpopular across the globe

    I enjoyed your sarcastic tone, it really underscores the humanitarian efforts of the US government and makes it seem like their only concern is the protection of American interests. Which, of course, should be the US governments only concern! But it's silly to think of ourselves as being on anything less than the moral high ground. We must feed the starving nations of the world!! I also liked the fact that you threw the Iraq war into the mix. Not that it had anything to do with food prices and biofuel, I just like being able to put our 200 million dollar donation into perspective. It's also a good thing to bring up when you want to ridicule the president, which I thought you did a phenomenal job of doing. You also did a good job of making farmers and grocers seem like money hungry profiteers who would love nothing more than to take advantage of starving people for a few extra dollars. To hell with the environment! To hell with the American farmer! And to hell with capitalism!!
    nymets076
    • Can you possibly believe

      that the Iraq War or invasion or occupation of whatever you wish to term it, has nothing to do with the rapid rise in crude oil prices? The fact that the U.S. governmenbt keeps talking about taking stern action against Iran, another major oil exporter, has nothing to do with rising oil prices?

      On the amount of money at issue, it is worth noting that we will borrow billions from Japan, china and other creditor nations to support military causes but not humanitarian. Or even possibly worthwhile green tech.

      I have no problem with American farmers getting rich, if they can...but remember most of those "farmers" are large corporations and much of your food cost goes to energy companies, wholesalers, retailers, fertilizer manufacturers, marketers, commodities speculators and banks, not guys riding tractors.
      atowhee
      • Yes.

        "Can you possibly believe that the Iraq War or invasion or occupation of whatever you wish to term it, has nothing to do with the rapid rise in crude oil prices?"

        You mean the prices that have been increasing long before 9/11 and the war? Do you really believe the Iraq war made any difference?
        CobraA1
      • The rapid rise of oil prices

        is occurring because oil is in short supply. Oil is in short
        supply because environmentalists have painted it as the
        most dangerous substance on the planet and are doing
        everything in their power to shut down supply.

        Just FYI, Canada is the number one supplier of oil to the
        U.S. Mexico is number 2. Venzuela is number 3.

        Finally, the rapid rise of gasoline prices has to do with the
        environmental requirements of doing boutique blends.
        Talk to someone in the gasoline distribution industry, and
        they will tell you what a horror story it is to get supply as
        refineries have to change over.
        frgough
        • Agreed

          let's go back to leaded gasoline and screw the next generation, what the hell did they ever do for us anyway...and while we're at it, fire up those coal burners, burn up those forests, damned snivelling little grade schoolers can just worry about their own little planet if they're tough enough...Waiter, bring me another slab of whale steak, please.
          atowhee
        • Well, actually it is more like

          ending Feb 2008 (1 to 5)

          Canada, Saudi Arabia, Mexico, Venezuela, Nigeria for Petrolium, and then
          Canada, Saudi Arabia, Mexico, Nigeria, Venezuela for Cude

          The rise in price is more to do with demand more then it has to do with supply. (there is plenty of supply)

          If people are willing to purchase oil at 110 dollars a barrel, other people will be more than willing to sell it at that price.
          GuidingLight
  • Biofuel Scapegoat

    Biofuels are just the newest scapegoat. Food prices aren't rising that much due to the small amount of corn-based ethanol we make in the USA. The volume of corn used to make ethanol is so much less than the total planted each year. Plus, there was an article on here recently on how more farmers are tilling fields they've left fallow for Federal ecological incentives. That means more corn to offset what's consumed by ethanol.

    So why is food more expensive? Maybe because the oil and gas that goes into every mile of transportation, every gallon of fertilizer, and ever acre of tilled soil is going up? Talking about the rise in food prices without discussing the huge increase in world oil prices is silly. The Chinese and the Indians are consuming huge quantities of fuel and driving prices up. Higher fuel and fertilizer prices are driving the cost of food up.

    Finally, I think it's great that the US can feed more than just itself. However, those countries that are yowling about how we choose to use our crops ought to consider growing their own or developing some other asset they can trade for our crops in the marketplace. Feeding the hungry is a good goal, but when the hungry start to demand our wheat and corn as their right, well... let them eat cake.
    shawn_dude
    • Biofuels scapegoated?

      That could be true. Biofuels have NOT caused higher food prices. But Marie Aotnointette was not the one causing folks to go hungry in Paris but she still paid with her life. While Brazil uses sugar and we use corn and France uses rapeseed to make fuel, all grown on arable land that could grow edible crops, and in other nations folks can't get their daily bread or rice (which is the #1 food crop around the globe), then we are in danger of becoming the latest Marie Antoinette.
      Yes, the weak dollar is an explanation but not an excuse...the dollar is weak because we cannot get China to do anything except bilk the rest of the planet with their fixed currency and near-slave labor, and we continue to buy everything madein China at the mall with money we as a nation don't have so we are helping the current U.S. government torpedo our own currency which in turn makes food more expensive for everybody on earth. Short of massive starvation, which may make Malthus smile in his grave, we are waiting for the markets to fix this problem?
      atowhee
  • Biofuel BS

    Sounds good on paper, but if you look at it its almost a breakeven point producing this stuff, fuel to till the soil, fuel to harvest, fuel to transport, energy to produce the fuel, bottom line = break even at best for each gallon produced. And no its not the farmers cashing in on this, they still get screwed over for their part in producing the crops, whether it goes to fuel or food.
    Go back to the drawing board and look for something else.
    hitechroadrunner
    • Yeah, it's called

      drill for more freaking oil. We are sopping wet in the stuff in
      the United States.

      The real problem here is environmentalism. It causes nothing
      but human misery every time it is applied. Without exception.
      frgough
      • Da@$#d right, bring back DDT

        Who cares if Brown Pelicans and Peregrine go extinct, they just eat animals we could be eating instead...Rachel Carson must've been acommunist getting folks all excited about pesticides...we need more poisons, not less, the cancer rate is rising becazuse environmentalists have put flouride in our water, and now they wantus to stop pollutikng the air and stop smoking in buildings...and hell, next they won't want us peeing into the resevoir's watershed...
        hey,frg, we ALL downstream...you think cancer is a random act? think pollution
        atowhee
  • So I/we are not giving enough?

    Thanks for info.

    I'm glad someone out there is ready and willing to give someone else's earnings away.
    crypt2121
  • RE: Biofuel just got even more unpopular across the globe

    This only scrapes the surface of the problem. Yes, oil prices contribute but harvest failures such as caused by the prolonged drought in Australia are also partly to blame.

    And oil prices would stabilise if we used less for fuelling power stations and built more sustainable energy sources such as nuclear power stations.

    Don't forget, most politicians are corrupt, immoral and liars. They will take the course which serves them best, not the course which serves the electorate.

    As for Iraq, we should never have started the war without a sound plan and a good exit strategy. Tell the politicians to do what most of the country wants - get our soldiers out of Iraq - and if they won't promise to do that, then don't elect them!

    Going back to the main theme, when the energy cost (raw materials, manpower, machinery, etc.) to grow crops for ethanol is costed properly, it just doesn't stack up. That is why biofuel is becoming more unpopular as an option to replace gasoline, not just the use of food sources which would be more useful as food!
    peterharding@...
  • RE: Old news -- But just now is getting...

    ...the attention of the media.
    Mr_Wizard
  • RE: Milton Friedman

    Milton is rolling in his grave over government subsidies for biofuels. This is not free market capitalism at work, it's bad government oligarchy at best.
    jmounteer@...
    • Milton Friedman died too soon

      He should be here now to see his "free market" at work. His silly naive belief--based on libertarina dreamsof a world where honest humans treat one another fairly-- that there is a free marketplace not prone to corruption and malfeasance, that quarterly earnings reports won't be rigged to max out the CEO's bonus, that Wall Milton used to love to claimthatg privAte property is better cared for than public, thus we need no environmental protections: better like at Enron and Bear Stearns and the Chinese factories using lead paint? sounds like some myth you learn when you play store in the fourth grade. Get over it, the more money to be made, the more corrupt, dishonest and dastardly will be the tactics used to get that money. Government sucks, but it is the only thing that can stand up to global corporations. Right now in China you have the worst of both worlds: the government is the big business. I tremble for what's left of this planet
      atowhee
      • Get a life!

        Humans operating in business are corrupt and greedy, whereas humans operating in government are the sweet, angelic saviors of mankind?

        If humans are prone to corruption and self-interests in one sphere of life, their nature does not suddenly change when they enter another sphere of that same life.

        What must be done is to limit the ability of any person ... in their personal life, business life, or government life ... to act illegally with impunity.

        Government officials must be held personally responsible for their acts, rather than to force the taxpayers to foot the bill for the official's illegal acts. Businessmen should likewise be held responsible, rather than the investors in the company.

        As for China's government being the big business, take a closer look here at home. Who really runs our government? When businessmen make large political contributions and pay millions to lobbyists, do they really expect nothing in return?
        ichetuknee
  • RE: Biofuel is perfect for Africa

    Most of you reading this post are totally forgetting one
    crucial piece of the puzzle: Stop growing Biofuels on your
    god damn best farm land!!!
    The idea of a sound biofuels strategy was that society
    would plant crops like Jatropha, hemp, pongamia (honge
    oil), castor beans, or moringa olifeira on MARGINAL land
    that would otherwise have no use.
    Thank you Mr. American farmer for growing biofuels on
    your BEST lands: Idiots!!!

    You're supposed to plant the above crops which thrive in
    arid to semi-arid climates. This would help reverse soil
    erosion and possibly even cool some regions (if done on a
    large scale!) due to said plants sucking up carbon dioxide
    from the atmosphere.
    Imagine if there was a massive initiative to plant hemp or
    jatropha in some huge dust bin piece of land in Texas,
    Arizona or California. This is where biofuels/biomass can
    shine.

    All of you need to peek Google on pongamia, jatropha,
    hemp (see The Emperor Wears No Clothes by Jack Herer),
    castor beans and moringa olifeira. It behooves me that
    American farmers plant corn to produce ethanol when
    hemp produces waaaay more biomass material than corn
    could ever chew. Heck, 1 acre of hemp produces the
    equivalent of 4 acres of TREES for producing pulp & paper.
    Said plant also makes a great biomass feedstock.

    The problem with biofules/biodiesel/biomass is simply
    poor or misinformed government lackeys and the naive
    farmers that kiss big Agri's asses. This is yet another
    example of STUPIDITY reigning supreme over SENSIBLE
    logic.

    To conclude, I believe Africa will do a better job with
    biofuels because LABOUR is CHEAP here. It will create lots
    of JOBS (harvesting, transportation, etc.) and save in
    precious foreign exchange. And don't forget, if you
    strategically grow these fuels in the rural areas, it will
    prevent migrants from flocking to cities like Nairobi, Dar es
    Salaam, etc. and thus reduce crime. Moreover, these
    people in said communities can grow their own energy for
    cooking (there's a jatropha stove made by Bosch),
    Combined Heat & Power systems (powered via pellets),
    biodiesel generators, or simply to power their modified
    vehicle engines.

    Say no to CORN energy from prime farm land and YES to
    biomass/biodiesel from crops that LOVE semi-arid to arid
    climates. Jatropha literally grows in any soil and is drought
    resistant.

    Peace.
    - MaxTheITpro
    maxtheitpro
    • Nan you git it right

      The West is mostly to blame - just look at Hemp. Great if you don't smoke it! US in the last great war had a "Hemp for victory" campaign, the forces were short of cordage and hemp was - is the best there is renewable, strong, biodegradable - it also makes the best paper the print industry has ever had -and saves trees. hemp is now a banned product. and we use a petroleum derived nylon rope that causes huge problems amongst marine life and adds to the general pollution of atmosphere, garbage dumps etc. The same US soldiers who relied on hemp cordage to help defeat the enemy were armed with flame throwers after the war and sent out to burn the hemp fields. So can't use hemp because some people insist on huffing it. On the same logic we should ban all petroleum production because here in Oz it is ruining the lives of thousands of native youngsters who sniff it. This type of warped logic is repeated over and over by humans. Hence you and i are on the downhill slide and every year of acceleration makes it more of a hazard to contemplate jumping ship ( if there was indeed a ship to jump to)
      On Site PC