May 22, 2008

University Of Nebraska Studies Ethanol's Effect On Food Prices

Ethanol's effect on food prices.Researcher Richard K. Perrin of the University of Nebraska at Lincoln just finished a study on ethanol's effects on food prices. Like other studies published recently it concludes that ethanol's effect on food prices is pretty limited.

The evidence available suggests that the ethanol industry alone is responsible for perhaps 30-40% of the increase in grain prices over the past two years, while these high grain prices themselves are responsible for no more than a 4% increase in U.S. food prices. This implies that ethanol is responsible for a 1-2% rise in US food prices.

Source : Ethanol and Food Prices - Preliminary Assessment

Below, in the related posts, are some of the other recent studies and reports that have concluded that other factors are having a larger effect on food prices than is ethanol production. In light of this growing body of research one has to wonder what the real reason is for the opposition to ethanol production by certain groups.

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