They have been able to get environmentalists to carry their torch for them, with a few careflly planted stories and "studies" about rising food prices and alleged net energy losses from ethanol. Their campaign of fear, uncertainity, and doubt should be in marketing and psychology textbooks for decades.

They first financed a report by a couple of college professors that said producing ethanol consumed more energy from petroleum than it created. This was false. It was based on old (maybe three decades) technology, and ignores the equivalent cost of finding oil and removing it from the ground (or from under oceans) and converting it into fuel. Without going into a deep cost analysis, it is easy to see how flawed this premise is. The cost of making ethanol is about $1.25- $1.75 per gallon, depending on the feedstock (corn, sugar cane, etc.). Ethanol has about 70% of the energy of gasoline, so that means it costs about $2 to make the equivalent amount of gasoline energy. To produce ethanol, you need to pay for land, labor, water, seeds, and then the fuel and petro-based fertilizer and pesticides. You can't get oil and the derivative products for $2 per gallon, and even if you did, you still have to pay for all of the other resources required to produce it, and those people don't work for free. No, it's more likely that ethanol (even if produced by inefficient corn) still produces more than twice the energy it consumes, which is a net plus, given all of the other advantages (less pollution, less oil imports, lower trade deficit).

The fear that is being instilled about biofuels causing food prices to increase is classical. The price of corn has increased, from about $2 per bushel to about $4. Yes, that sounds like a lot, but the cost of food is largely unrelated to the cost of corn. A lot has been made of the price of corn flour, but there are about 40 pounds of corn flour produced from a bushel of corn. That means the cost of corn used in making corn meal has gone from about five cents per pound to ten cents per pound. Any increased beyond ten cents per pound are due solely to companies taking advantage of the hysteria (i.e., gouging).

If the price of corn does continue to go up, it will be great for the health of the average American. Since the advent of the widespread use of corn syrup as a sweetner, the incidence of diabetes has greatly increased. The body does not react to corn sweetener like it does to sugar, and stores it as fat, which is one big reason why there are so many more obese people today than 25 years ago. If the price of corn syrup goes up enough, it will be less expensive to use sugar. Unless, of course, the farm lobby gets congress to increase tariffs on sugar even further.

And I haven't even mentioned the benefits of biodiesel...

This article (Saletan's) is a terrible analysis. It's hard to know where to start.

First, Saletan's hypothesis that Latin American (and other land-rich) third world countries would benefit from biofuels by creating an exportable product is premised on the notion that somehow massive U.S farm subsidies will end sometime soon. In the real world, that's no where near on the horizon.

Second, to buy this analysis requires an almost willful ignorance of the recent history of trading relationships between the third world and the "industrialized" world. For any biofuel industry to be viable would require massive state subsidies, which is how Brazil did it. In the real world, it is highly unlikely that massively debt ridden (fill in your country here) will have the ability to do that. What is more likely is that food will be shipped to a place like the U.S for conversion into biofuel. In other words, the higher value product gets made in, say the U.S, while the lower value product is produced abroad. Hmmmm, that pretty much characterizes the trading relationship between the third and first world since colonialism. Hard to see how this will be any different.

Finally, Saleten mentions that many Latin American countries have land to spare to devote to this miracle product. Even if I grant him that the U.S ends their subsidies, somehow the debt addled third world will be able to build the infrastructure to produce biofuels within the country (both extremely unlikely, but let's go with it), we are left then with a product that only requires something everyone has, which confers no special comparative advantage to anyone.

As for the previous post. I know next to nothing about the price of food, but it is my understanding that corn pretty much goes into an astonishing percentage of the food we eat, you even allude to this with your point about corn syrup. So, I don't see how an increase in the price of corn would not lead to an increase in food prices. Please explain.

Biofules do not need subsidies to be profitable anymore, not with oil above $70 per barrel. In fact, they (biodiesel and ethanol) are profitable when the price of oil is above $45 per barrel, and it's unlikely that we will see that price again. The U.S. ethanol producers use corn because it is readily available here, and even though other crops would be a more profitable feedstock, they make enough money anyway, and the farming industry has minimized risk, as they don't have to decide what to grow, corn can be stored and sold for multiple purposes. Brazil's biofuels industry has huge cost advantages over the U.S. and less politics-driven opposition. Sugar cane is a much more efficient feedtsock than corn, and they can grow it easily there.

The third world governments do not have to invest in the biofuels infrastructure, there are plenty of venture capital funds and wealthy corporations who are already doing that (it might even be called a stampede). As long as oil stays above the minimum price for biofuels to be competitive, they will be profitable, and with increasing energy consumption by China and India, it's unlikely that the price of oil will drop.

Yes, musa98, you are correct that corn goes into almost everything most people in the U.S. eat (not me, I don't eat meat or products with corn sweetners, so that reduces my corn consumption dramatically). But the cost of the corn content is negligible compared to the price of the finished product for many of these food items. If a pound of corn flour costs is $2, and the corn used to make that costs ten cents instead of five, it's hard to blame the increased cost of the flour or tortillas on the cost of corn increasing by five cents per pound. While soda is basically flavored corn syrup and water, the actual cost to produce the liquid is much less than the cost of packaging, transporting, and marketing it, plus distributor and retailer markup. And even if cola prices double, it will only be good for this country. for a great explanation on the relationship between corn and food, oil, and politicians, read The Omnivore's Dilemma. It's not a vegetarian preaching, but it is very educational.

I do not doubt that the professors you mention, whose studies claim to show a net energy deficit from ethanol production in the US have been largely discredited.

But even if they are wrong (which I suspect they are), they do raise a good point, in that there IS a very large energy consumption required to produce ethanol from midwestern corn. I think that perhaps the best numbers I have heard from credible sources is around 50%.

Considering that, how many acres of additional farmland would be required to significantly reduce our current dependence on Mideastern oil, how much additional water will be required for irrigation, etc?

Mind you, using corn for fuel seems like a lot better choice than is feeding it to us in the form of high fructose corn syrup!

BTW, while I am no expert, I am told that the opportunities for biodiesel are much more encouraging.

I've seen one estimate (it was just recently, but I forget where, sorry, I'm not a journalist) that said ethanol from corn created 2.65x the energy equivalent in oil it consumed. My feeling is that if ethanol creates 1% more energy than the oil it requires, it's worth it. And gasoline is not just pumped from the ground, it must be discovered, extracted, shipped from far away places, and then go through an extremely energy intensive process to get turned into usable fuel. Add the cost of military force that seems to be necessary to ensure its' flow, and it's likely to consume a lot more energy that ehtanol.

There are two additional points I would like to make about the ethanol debate. First, corn, as many people point out, is one of the worst sources of ethanol. It will soon be replaced by more efficient forms, like cellulosic ethanol, which can be created from ordinary switchgrass. Switchgrass is what used to grow wild in the plains states (and still does in some areas), and requires no oil-derived fertilizers, less water, and less cultivation. It also is much better for the soil, and is a natural habitat for wildlife. It will be much more profitable for ethanol producers and farmers than oil, it's just that its' viablility is a few years away. In the meantime, it's great that there are other sources of ethanol to justify the development of the distribution channels for it, and for the manufacture and sales of vehicles that can operate on it. When cellulosic ethanol is ready for prime time, the demand and infrastructure will be in place.

The second point about ethanol is that it is just a temporary phase we must go through. In 20-30 years, there will be better, more efficient, less polluting ways to power transportation. Until then, ethanol (and biodiesel) provide an alternative to the trade deficits, carbon emissions, and military actions that an oil-based economy seems to cause. In the meantime, it's not going to cause anyone to starve.

kgsbca:

.... My feeling is that if ethanol creates 1% more energy than the oil it requires, it's worth it....

A couple of comments to that:

1. At only 1% net gain, it is gonna require cultivation of all cultivatable land to produce enough energy to make any difference.
2. At such a low level, we would nearly double the net CO2 emissions. If we produce ethanol equivalent to 100 bbl of crude oil, burning that ethanol itself will release the same amount of CO2 as would burning the oil. The equivalent of 99 bbl of crude required to grow and produce the feedstock and the ethanol produces nearly the same amount, while the CO2 absorbed from the atmosphere by growing the sawgrass would be offset by the loss of same from the wheat that would otherwise have been growing.

It may not need subsidies to be profitable, but it needs massive investment for the infrastructure that allows for food to be turned into gas. The thought of multi-nationals setting up this infrastructure in, say Honduras, where their operations are sure to be tax free and profits repatriated, hardly gives me hope that less people in that country will go hungry - which is what Saletan's article is claiming.

By the way, I don't necessarily disagree with the idea that a biofuels boom would lead to less hunger in the third world, its just not for the reasons stated in this article. If all (or a substantial part) of the U.S's farmland is spent producing gas, that means less highly subsidized food being dumped on the world market, and driving small third world farmers out of "business". In other words, with corn belt farmers' attention turned to producing fuel, poor Latin American campesinos will be a little less screwed by unfair U.S trade practices. It might even stop the flow of illegal immigrants from Mexico, which is largely the product of the unfair agricultural trade practices that NAFTA locked in over a decade ago.

I wasn't clear what I meant by a net 1% gain - I was trying to say that if one gallon of oil energy created 1.01 gallons of ethanol energy, it would still be worth doing. However, this isn't the case, as ethanol (even from corn) creates far more energy than that.

Not all of the oil that is alleged to go into the production of ethanol is used for fuel, a lot of it is for fertilizer. Most of that wouldn't be necessary for cellulosic ethanol from switch grass, as you don't need to fertilize switchgrass (it grows in the wild).

Additonally, the performance of biofuels shouldn't be judged on today's technology. Investment in R&D is already enhancing yields of ethanol and biodiesle, and will continue to do so, while the number of gallons of gasoline per barrel of oil will not change.

I think ethanol in third world countries might be a bit of a stretch, but they can definitely get involved in both the production and use of biodiesel. The biodiesel process is relatively simple; people are able to make it in their garages today. The plants that are actually best for producing oils for biodiesel (jatropha) grow well in warm, arid climates, and could easily be grown and harvested in Central and south america. Trucks in those countries could be easily modified to run on biodiesel (they just need new fuel lines if they are older than 10 years), whereas retrofitting older cars to run on ethanol is not viable.

Nobody will go hungry because of ethanol and biodiesel. Maybe some Americans will eat less meat and drink less soda, but it's not going to affect the diet of third world countries. That is just a scare tactic of the oil industry (as if they care about them).