December 22, 2008

Is Ethanol Off The Hook For Rising Food Prices?



There have been several articles over the last few days that articulate the disconnect between the rhetoric waged by the anti-ethanol campaign in blaming food prices increases on ethanol production and the fact that food prices have remained high despite the recent fall in commodity prices. Here is a sampling of those articles.

Investigation: Inside the ethanol subsidies controversy

Fact vs. Fiction on Food vs. Fuel

It is nice to see that the food versus fuel issue is dying down somewhat but as one article points out the battle being waged against ethanol isn't over just changing terms.

There are signs that the GMA and Food Before Fuel lobby are changing tack a little in attacking ethanol. There also seems to be a slight de-emphasising of the price-rise issue to instead concentrate on ethanol's supposedly detrimental affect on the environment.


But as all the articles point out the campaign has created an atmosphere in which food companies can increase their profits and after all that is what trade organizations such as the GMA are supposed to do.

2 comments:

Paul Winters said...

Thanks for this post. Rhapsody in Green (http://www.rhapsodyingreen.com/rhapsody_in_green/2008/10/food-vs-fuel-should-be-put-out-to-pasture.html) also notes a Reuters article (http://uk.reuters.com/article/oilRpt/idUKN2338007820081023) that explores the real causes of food price rises in 2008. Hopefully, reporters will retain some memory of the facts.
They should also note that this data is a key to the indirect land use debate, since price rises are one signal for other countries to bring new land into production.

mus302 said...

There have been a few good articles over time but the fact that several had come out in such close order was what got my attention. I think that most reporters just assumed that because ethanol production was increasing and so were food prices that the two events were connected more closely than what they actually are. Now that the two events are acting independently of each other I think that we are seeing in this grouping of articles a shift in their thinking.

I agree that this could and should have key implications in the indirect land use debate. Most of the estimates seem to suggest that global agricultural output will fall next year because of lower commodity prices and so some farmland will be returned to it's prior use even though ethanol production will increase next year. That should test the link between ethanol production and land use changes.

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