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 What food price backlash? US pushes for 85pc ethanol 

What food price backlash? US pushes for 85pc ethanol

17 Jul, 2008 10:58 AM
While many around the world are railing against biofuels for pushing up food prices, United States Governors and General Motors are pushing for greater roll out of 85pc ethanol blends.

The United States National Governors Association has announced a public-private partnership between its NGA's Securing a Clean Energy Future Initiative and General Motors Corporation, to help States increase the number of E-85 fueling stations.

Under the partnership, States will develop a strategy for installing E-85 pumps in key locations.

GM will provide technical assistance to States in developing these strategies and will leverage their relationships with the automobile and ethanol industries to help States implement their strategies.

GM will provide technical assistance to states to help them assess optimal locations for E-85 infrastructure.

They will also work with top ethanol producers and fuel infrastructure experts to optimize E-85 supply to States.

GM's participation will include an assigned liaison to lead the assessment from a GM standpoint and to participate on the States' E85 task forces.

Additionally, GM will leverage its network (dealers, plants, offices) and its extended ethanol related network (ethanol industry stakeholders, NGOs, corporate partners) to promote and advocate E85 usage in the states.

This promotion and advocacy effort can include: state/local education/awareness through GM and dealer efforts; mailings to GM FFV owners on E85 stations; advertising (print, outdoor, internet); dealer/station promotions; and broader promotional and marketing events.

Participating States will establish an E-85 task force that includes a team of state officials, retailers and auto manufacturers to help identify target areas for E-85 refueling states, perform the assessment, identify potential funding sources to support pump installation/conversion, and assist with implementing, where appropriate, the resulting recommendations.

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Must be a US federal election looming! The USDA must have their heads shoved where the sun don't shine if they think bio-fuels are not having a significant impact on global food shortages. I ask them this...what would happen if the 100 plus bio-fuel plants across the US where closed down tomorrow?
Posted by Ben F, 18/07/2008 10:38:24 AM
What would happen is that corn prices would drop, but food prices would not drop very much. When an ethanol plant uses a bushel of corn, it only takes the starch and returns the fat and protein back to cattle farms with the DDG by-product. While cows cannot eat DDGs as 100% diet, the DDG containing proteins and fat is a good product to feed to the cows for faster growth. The starch in corn is not needed as much for cattle growth, and ethanol uses the starch.

Much of the price increase in corn is due to higher exports which are made possible by a devalued dollar making our corn look cheap to foreign countries. If we were really concerned about using corn for uses other than food, we would ban High Fructose Corn Syrup and require companies to use sugar instead, since the HFCS comes from corn and is to blame for making us all fat from consuming too much HFCS which doesn't register with your body that you are taking in too many calories.

Besides, the growth in our corn crop total production over the past few years has more than surpassed the additional corn being used by ethanol production. Plus the DDGs from ethanol are still going back into cattle feed.

Posted by Reeser, 21/07/2008 8:39:00 AM
Ben asks what would happen if the biofuel plants shut down. Well, according to Merril Lynch chief commodities analyst, Francisco Blanch, the price of oil would increase 15 percent. That oil increase would add much more to the price of food than the biofuel driven increase has. With 8 cents worth of corn in a $3 packet of corn flakes, and 15 cents of wheat in a $2 loaf of bread, the cost of grain is insignificant compared to the cost of energy in food. In fact the packet on the flakes costs more tha the corn. What many people don't appreciate is that grain selling for less than the cost of production has been the driver of food shortages. Farmers in unsubsidised nations have struggled to remain viable, and the subsidised nations have had caps on production. This increase in the cost of grain, up to a whopping 3 percent of the cost of a packet of corn flakes, will provide the driver to increased production and food security. And as a beneficial aside, biofuels will moderate oil price rises and improve our environment and health.

A 10 percent ethanol blend would halve our respiratory health problems at a massive saving to our economy and health system let alone the agony of those that suffer. I just wish our legislators had a clear perception of the benefits of biofuel implementation. But all we do is argue about whether we have 20 or 50 years of oil left, and how much we have to tax our farmers and industries to assuage our conciensces. It seems that our political horizons are electoral cycles, and our environental horizons are our own expected lifetime only.

Posted by JB, 21/07/2008 9:13:38 AM

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