The "Republican war on science" has evidently opened a new front: economics, a discipline often fetishized by the right.
In a startling article published July 4, the Guardian reports that in a "secret" study, a World Bank senior economist concluded that the recent explosion in biofuels use has driven global food prices up by 75 percent -- a number much higher than estimates from other major sources. The USDA -- which has vigorously defended President Bush's seemingly bottomless support for crop-based fuels -- claims biofuels account for only 3 percent of recent food price hikes.
The World Bank study's author, Don Mitchell, finished his assessment in April, the Guardian reports. But it never saw light of day until the British newspaper got hold of a leaked copy.
Why was it suppressed? "Senior development sources believe the report, completed in April, has not been published to avoid embarrassing President George Bush," the Guardian reports.
I hope the Guardian piece inspires World Bank to release that report. It's been extremely difficult to find reliable analysis on how U.S. and European biofuel mandates and subsidies have been affecting food prices.
Biofuel booster/investors like Vinod Khosla like to point to studies from private research houses like Informa (PDF) and LECG (PDF), both of which concur with the USDA's assessment that the biofuel boom has virtually nothing to do with higher food prices.
But click on the above Informa link, and you find its report was "prepared for the Renewable Fuels Foundation." Meanwhile, the author of the LECG paper lists among his clients "the Renewable Fuels Association, National Corn Growers Association, American Soybean Association, and United Soybean Board, the National Biodiesel Board, [and] the Canadian Renewable Fuels Association."
Other studies, too, deliver conclusions that intersect with the interests of their funders. Keith Collins, for example, recently sashayed through the USDA/food industry revolving door, changing his gig from chief USDA economist to researcher for Kraft Foods. Transnational food processors like Kraft compete with ethanol makers for corn, and they would prefer to see ethanol mandates be discarded.
Coincidentally or not, Collins's recent Kraft-funded study (PDF) found that the ethanol boom has pushed up food prices by 25-35 percent.
These conflicting conclusions -- and the conflicting interests that fund them -- make the repressed World Bank report all the more important. The World Bank is hardly a neutral institution; Bush himself appointed the bank's current director, Robert Zoelick, last year. Zoelick has been bouncing between high-level posts in Republican administrations and the private sector since the 1980s. To claim the World Bank position, he left a plumb job at Goldman Sachs -- which he gained after five years of high-level posts in the Bush administration.
Zoelick's loyalty could explain why the World Bank has been hiding the biofuel study from the public since April. One unnamed "senior development source" told the Guardian that, if released, the report would "put the World Bank in a political hot-spot with the White House."
But even though the bank's leadership is politically beholden to Washington, its staff has always been capable of producing work cogently critical of Washington's agenda. Unlike Keith Collins or the rent-a-researchers cited by Vinod Khosla, World Bank staffers don't answer directly to people with a specific agenda on the biofuel question.
Indeed, given that 100 million additional people have been pushed under the poverty line worldwide by the recent spike in food prices, the World Bank has an interest in figuring out exactly what's behind the spike.
Until the report goes public, it's impossible to figure out exactly what's in it; all we've got is the Guardian account. So why is its estimate for the effect of biofuels on food prices so much higher than others? Here's what the Guardian says:
It argues that production of biofuels has distorted food markets in three main ways. First, it has diverted grain away from food for fuel, with over a third of US corn now used to produce ethanol and about half of vegetable oils in the EU going towards the production of biodiesel. Second, farmers have been encouraged to set land aside for biofuel production. Third, it has sparked financial speculation in grains, driving prices up higher.
The third factor -- speculation -- is often treated as an independent cause for the price spikes. But when you think about it, why did speculators suddenly start bidding up the price of grains and soybeans two years ago? Answer: because they knew the U.S. and European governments were insuring a steady, and rising, market for those goods in the years ahead. So the big speculation wave stems from the welter of mandates and subsidies propping up the biofuels market.
Meanwhile, Robert Zoelick has plenty of explaining to do about why it took a leak to bring this important study to light.
Cash for Clunkers brought us ... more clunkers!
Corn-based meat and ethanol: burning the planet to a crisp
Comments
View as Flat
GreyFlcn Posted 4:44 pm
05 Jul 2008
Got a David Fridley speachified presentation video for ya.
http://video.google.com/?docid=287398391460321023
FINALLY got around to ripping it, re-encoding it, and uploading it.
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GreyFlcn Posted 4:45 pm
05 Jul 2008
The title of the presentation is:
Myths of BioFuels
http://video.google.com/videoplay?docid=28739839146032102 ...
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justlou Posted 10:20 pm
05 Jul 2008
Food prices are being impacted by several major factors which are interconnected in global feedback loops -- the price of commodities, petroleum prices, mandated demand for biofuels, increased demand for meat in some developing countries as well as our own over consumption of meats, costs of production including rapidly rising fertilizer prices, climate and weather, transportation, hoarding of commodities, speculation, perceptions of shortages, and overall economic conditions. Placing an exact measure for any particular factor would be difficult to isolate due to all these interacting factors and feedbacks. The timing of the big increase in ethanol production just prior to the big increases in corn and soybean prices does tend to put a big target on the ethanol industry.
What is very troubling is that there seems to be an inflationary spiral at work here capable of growing out of control and that globalization has set the stage for this spiral to spin even faster by temporarily masking limits to growth via global trade, promoting rapid and unsustainable growth, giving us a false sense of security, and stalling preventative measures like reducing our demand for oil (see "American Energy Policy, Asleep at the Spigot", http://www.nytimes.com/2008/07/06/business/06oil.html?8dp ... ).
We are bumping against economic signs of a reckoning with the realities of living on earth as an alien culture. Rising prices only point toward much deeper problems with our delusional way of living.
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Jonas Posted 11:34 pm
05 Jul 2008
It concluded that the contribution of biofuels has been "marginal". No overall percentage, because the picture is rather complex.
But "marginal" is a pretty straightforward word.
Wageningen UR: biofuels not to blame for high food prices; decline in world food prices to continue -
June 17, 2008
I don't trust either the left or the right on this.
-The left says: "resisting biofuels is like commiting a crime against the world's poor".
-The right says: "producing biofuels is a crime against humanity".
It's not a good debate.
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Jonas Posted 11:43 pm
05 Jul 2008
Let the US and Europe develop electric cars. Let the South benefit from the much more economically viable biofuels.
Let's not forget that the World Bank isn't really pleased with the prospect of seeing developing countries grow. Because biofuels represent the biggest economic opportunity in decades for these countries, it is normal to see such an ideologically burdened anti-biofuels report from the Anti-People Bank.
By the way, the report is pretty hilarious. Rice prices have shot up more than 80% in under 5 months time. But no liter of biofuel is made from rice. And there is no evidence whatsoever that countries have scrambled for more rice to replace corn (which was indeed affected by U.S. ethanol).
The report does not make sense. It is written with the agenda to keep the South poor. Most of the research made by the Anti-People's Bank has that agenda in mind.
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Jon Rynn Posted 12:48 am
06 Jul 2008
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amazingdrx Posted 2:00 am
06 Jul 2008
Unless mass delusional media flogs a point to death, it's a secret from low information (swing) voters.
Mass media is still stuck on the clean, green fuel farming message. How do we get the secrets through?
Oh and it has tripled the price of fertilizer. And chemical fertilizer emits nitrous oxide, producing as much GHG effect as 2/3 of the CO2 the crop absorbs.
Mass delusional media and politics run on open secrets.
http://amazngdrx.blogharbor.com/blog John Schneider, Northern Wisconsin
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Ron Steenblik Posted 2:10 am
06 Jul 2008
The report does not make sense. It is written with the agenda to keep the South poor. Most of the research made by the Anti-People's Bank has that agenda in mind.
I have seen the report, and it is written with no agenda other than to try to identify the relative importance of the different factors that have contributed to the 140% rise in the World Bank's index of food prices between January 2002 and February 2008.
You will see once (if) Don Mitchell's draft (8 April 2008) report ever becomes public that it is well researched. It appears to have been an input to the World Bank's public document, "Rising food prices: Policy options and World Bank response" [140 kb PDF], which was released on 11 April 2008.
Some information about the report was already leaked in May. Asbjørn Eide, in a report for the Food and Agricultural Organization of the United Nations titled The right to food and the impact of liquid biofuels (agrofuels)" [620 kb PDF], for example, wrote:
David Mitschell [sic], Lead Economist at the Development Prospects Group of the World Bank, has pointed out that the World Bank's index of food prices increased 140 percent from January 2002 to February 2008, and he argues that three quarters (105 percent) of the rise was due to biofuel and the related consequences of low grain stocks, large land shifts, speculative activity, and export bans. While he recognizes that the increase was due to a confluence of factors, the most important was the large increase in biofuel production in the U.S, where 25% of the production of maize goes to ethanol production, and in the EU, where 47% of vegetable oil production is used for biofuel production. Without the increase in biofuel, Mitchell argues, global wheat and maize stocks would not have declined appreciably and price increases due to other factors would have been moderate.
The World Bank, in its 11 April report, explains further:
Almost all of the increase in global maize production from 2004 to 2007 (the period when grain prices rose sharply) went for bio-fuels production in the U.S., while existing stocks were depleted by an increase in global consumption for other uses.[2] Other developments, such as droughts in Australia and poor crops in the E.U. and Ukraine in 2006 and 2007, were largely offset by good crops and increased exports in other countries and would not, on their own, have had a significant impact on prices. Only a relatively small share of the increase in food production prices (around 15%) is due directly to higher energy and fertilizer costs.[3]
[2] From 2004 to 2007, global maize production increased 51 million tons, biofuel use in the U.S. increased 50 million tons and global consumption for all other uses increased 33 million tons, which caused global stocks to decline by 30 million tons (Mitchell 2008).
[3] Mitchell (2008) `A note on rising food prices' (mimeo).
Mitchell's analysis, in other words, isolates the various factors, and asks first how the markets for grains and oilseeds would have coped with those largely beyond governments' control -- namely, rising population, shifting preference for animal products, drought in some countries (and good harvests in others), rising oil prices and consequent knock-on effects on fertilizer prices. The rest he attributes to biofuels and the related consequences. Those related consequences include declining grain stocks, major land-use shifts, speculative activity and export bans.
Is it fair to attribute those "related consequences" to the surge in the use of crops for biofuels? In my personal opinion, yes. Had there been no diversion of crops to biofuels, the markets simply would have been calmer, and it is not unreasonable to suppose that speculation would have been modest, and fewer if any countries would have decided to impose export bans. Biofuels were the new factor, largely driven by policies. Everything else (yes, even the fact that in any given year there will probably be a drought somewhere), except perhaps the fall in the value of the U.S. dollar, had been anticipated.
What is interesting is the change in tone between the WB's 11 April document, "Rising food prices: Policy options and World Bank response" and the open letter [40 kb PDF], dated 1 July 2008, that the President of the World Bank, Robert B. Zoellick sent to the Prime Minister of Japan, who is hosting Monday's Group of Eight (G8) Summit. The 11 April document makes no specific recommendation on biofuels, and merely states, "Trade-offs between energy security, climate change and food security objectives need to be carefully monitored and integrated into both food and bio-fuel policy actions." By contrast, Zoellick's letter (finally) steps into the breach, albeit tentatively:
[W]e advise the United States and the EU to reduce mandates, subsidies and tariffs on biofuels produced from grains and from oilseeds, at least at higher price levels, and invest in second-generation cellulosic biofuels.
People need to understand the that there are two different approaches to measuring changes in food prices. People also need to look beyond average values and consider the distributional impacts.
The basis for comparison for the World Bank's work on food prices estimates is its index of food prices, which is an export value weighted dollar index of developing-country prices of export food crops. That is to say, its basis (as is IFPRI's and several other recent reports on food prices) is the prices of unprocessed commodities.
When the U.S. Administration talks about food prices, it is referring to changes in the consumer price index (CPI) for food, which is a measure of household expenditure on food (but not beer and wine), including restaurant meals, which have a 45% weighting in the Food-CPI. Of the 55% not spent in restaurants, a large amount of the cost relates to processing, packaging, transport and retail margins. Hence it is not surprising that various economists (e.g., U. of Nebraska's Richard Perrin) might find that biofuel policies have increased household expenditure on food by "only" 1 or 2 percent. But 1-2% of $1.1 trillion is still an increase in household food expenditure of $11 to $22 billion per year.
Now apply the same approach to the world. Assume, roughly, that annual per capita expenditure for the richest 1 billion people in the world is $4,000 (i.e., the same as in the United States); for the middle 3 billion people it is $1,600; and for the poorest 2.5 billion people it is $400 (55% of the expenditure of people living on $2 per person per day). That implies total global household expenditure on food of $9.8 trillion per year. If biofuel policies increased that expenditure by "only" 3%, as asserted by some analysts, that is still a staggering $294 billion per year.
Now, divide up that cost according to population (a fair starting assumption, given that at root of the food crisis is the increase in the cost of grains and oils, expenditure on which is more proportional to population than income), then how do the average increases play out by country grouping? My rough calculations show something like the following:
High-income consumers ... 1%
Mid-income consumers .... 3%
Low-income consumers .... 11%
That 11% is an average increase for the poorest 40% of the world's population. If one thinks of the really poor, some of which were already spending two-thirds of their income on food before the price increases, a 11% increase in their food bill (on top of increases caused by higher oil prices, and increases in demand for grains for food and feed), that is significant. It can make the difference between barely adequate nutrition and malnutrition or worse.
P.S., As for Wageningen, as with any institution, it does both good research and less-good research. In any case, I would think that economists at Iowa State University, Pennsylvania State University, U. of California-Davis, Cornell University, Purdue University and a whole host of other agricultural universities might agree that Wageningen is AMONG the world's leading agricultural economics institutions, but not that it is THE world's leading agricultural economics institution.
These are only my personal opinions.
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Jon Rynn Posted 2:23 am
06 Jul 2008
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amazingdrx Posted 2:47 am
06 Jul 2008
Maybe with Gore, Lester, Amory, Ed, .. and others speaking? Would the enviro orgs like Sierra and NRDC maybe kick in for something like this? Even after all the bad things we say about them here in the blog? They don't read it, do they? hehey.
http://amazngdrx.blogharbor.com/blog John Schneider, Northern Wisconsin
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amazingdrx Posted 2:51 am
06 Jul 2008
That way we could (torment) communicate with the mass delusional media from cyberspace, in REAL time! Mwhahahahaha
They could join in from their laptops.
http://amazngdrx.blogharbor.com/blog John Schneider, Northern Wisconsin
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Jonas Posted 4:14 am
06 Jul 2008
It is the most authoritative to date on rising food prices, written by researchers from the world's most authoritative agricultural science organisation. And it is also the least ideologically burdened (let's not forget that the World Bank does have a well known agenda, as have the other organisations that have produced similar reports.)
But apparently nobody cares about objectivity and scientific rigor any longer in this dead end debate.
It makes me wonder why Gristmill does jump on this World Bank report but hasn't mentioned Wageningen's once?
@Ron, since the report isn't public, anyone can write whatever he wants about its context (namely that it was written for the World Bank, one of the world's most problematic and dangerous institutions, with a horrible track record in development history.)
So if you do the post, please include the Wageningen study.
Here's the widely distributed press release (even though none of right wing media used it, only some left-wing blogs like my own):
Several factors influence world food prices
A complex of factors underlies the current, high food prices. The effects of speculation around food crops should not be overestimated nor should the influence of biofuels on world food prices. In time, food prices will again decline. These are some of the recent and most important conclusions in an economic analysis of the development in world food prices from experts at Wageningen University and Research Centre in the Netherlands.
Wageningen UR asked a number of experts to contribute to the national and international discussion by offering analysis from different perspectives. A first memorandum on the analysis of the recent price increases has already been presented.
Influence on price formation
The long-term trend of world food prices is declining. This is happening because, among other things, technological developments are pushing up the production per hectare and that, in turn, is pushing the prices down, researchers argue. Now and then brief peaks occur in food prices. It seems that the current wave of price surges is such a peak. The current peaks in the prices are lower than the peak in the food prices in the 1970s, which was the result of the oil crisis. Of course, the trend can change, but the expectation is that the response to the current, high prices will again cause a decline.
The effects of speculative investments in food crops should not be overestimated. On the one hand, they can lead to a quick increase in prices. However, on the other hand, if a decrease in prices starts, the same investments will lead to a quick fall in prices.
A large number of factors influence the current price development:
Poor harvests have caused low wheat and barley yields in Australia, the Ukraine and Europe. The stores of these grains are running out, and the current barley and wheat prices are high.
High maize yields led to a world-wide increase of the total grain harvest in 2007. Because of this, maize prices remained relatively low. Only very recently have increases in maize prices been detected.
High energy prices lead to high costs for artificial fertilizers and fuel, among other things. Higher transport costs lead to price effects for transport over long distances.
Argentine, Kazakhstan, India, Vietnam and Egypt have levied export taxes to protect their own food supply. This has pushed up prices on the world market.
The production limitations for food products in the EU have pushed up prices.
In the past, the low prices for food production were not an incentive to invest in technology that increased production.
The demand in Europe and North America is stable, but the demand is growing in Asian countries as a result of income developments and changes in diet.
The demand for agricultural products for the production of biofuels has a small effect:
-- Only 5 per cent of the oilseeds goes to biodiesel or directly to the transport sector;
-- 4.5 per cent of the grain production is used for ethanol.
Although this is a marginal demand, it still has an influence on the development of prices on the world market because the supply of food products on the world market is relatively small. At the same time, the increasing prices cause a decreasing demand from the biofuel sector because biofuel production is increasingly unprofitable.
Price pressure
In the opinion of the Wageningen UR experts, a number of developments will appear in response to the high prices. These developments will, most likely, cause a downward push.
The high prices will lead to the use of agricultural land that is currently not in production. Huge potential exists particularly in Brazil and Russia. In other countries, production will be intensified, and this will lead to a decrease in prices.
Because of the high prices, investments in R & D and technology will again become profitable.
To dampen price instability, strategic stocks are indispensable.
The influence of the biofuel directives on the development of world food prices is relative and depends on the technological developments around the production of biobased commodities. The investments in second generation biobased production are important because the production of second generation biobased products does not use the direct food product but the whole plant.
The development of the oil price is significant in predicting the demand from the biofuel sector. In the current price relation between oil and biofuels, biofuels are not profitable. With this price relation, the volume of the biofuel market will be limited to the commitments in the biofuel directive. With a relatively high oil price, biofuels can become competitive: the food and fuel markets will then be further integrated and the food prices will be determined, to a greater extent, by the oil price.
Unpredictable movements in food prices can still provide problems in the future. With high prices, the consequences in terms of hunger or malnutrition especially in poor areas will surface, and with low prices, the consequence for poor farmers will be large. In poorer areas of the world, the expenditure for food makes up, on average, about 50 per cent of an individual's disposable income. As such, price increases in these regions have dramatic effects. This percentage climbs to 65 per cent if the food prices rise by 30 per cent. In the wealthy lands, these effects, on the other hand, will be limited to 1 to 2 per cent of an individual's income.
Apart from this, the researchers state in their report that the hunger issue is, however, only partially attributable to the demand for biofuels and is much more attributable to bad policy and the poor performance of the markets.
And the actual report:
Why are current world food prices so high?
Authors: M. Banse, P. Nowicki, H. van Meijl
Den Haag, LEI, 2008, Rapport 2008-040; ISBN
Reason must rule.
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Bart Anderson Posted 8:12 am
06 Jul 2008
The report doesn't seem to me particularly authoritative. It's based on talks with some experts, existing literature and the authors' own research. In other words, it's more like a white paper for policymakers rather than anything deep or original.
The report is ideological, reflecting as it does the thinking of agricultural economists in the developed world. (My guess is that the ideology is not that different from the World Bank - that's what makes the leaked report from the World Bank so surprising.)
The authors of the report have a definite program and set of values, for example: Not particularly interested in soil health or ecological issues. Committed to the world market as a cure-all for hunger and agricultural issues. Ignore differences between industrial agriculture and small-scale agriculture. Open to occasional intervention to prevent starvation and hardship (though they oppose government intervention in general). For a different perspective, see the work of people in the food sovereignty movement, which claims "right of peoples to define their own food, agriculture, livestock and fisheries systems," in contrast to having food largely subject to international market forces. The key point of the Wageningen report (downplayed in the press release) is the interlocking factors of food and energy. Biofuels, however, create a more direct link between food and fuel prices and if fuel prices increase further, the long-term trend of declining real food prices might be dampened or reversed. If one assumes that fuel prices ARE going to rise long-term, as many do, then the food vs biofuel conflict will only get worse.
Elsewhere, the report says : The increased biofuel demand between 2000 and 2007, compared with previous historical rates of growth, is estimated to have accounted for 30 percent of the increase in weighted average cereal prices during 2000-07.
(p.22, from a International Food Policy Research Institute (IFPRI) study) and If all [biofuel directives and initiatives] are implemented together and technological change stays on the historic trend, then the impact on world prices is substantial and the long term trend of declining world prices in the reference scenario might be dampened or reversed. The arrival and impact of second-generation biofuels is uncertain.
(p. 25)
Bart
Energy Bulletin
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Ron Steenblik Posted 8:16 am
06 Jul 2008
I'll leave it to other readers to judge my own objectivity, buy I fail to see what Jon Rynn said in this string that is the least bit subjective.
Regarding the Wageningen report, it is one among many. Had my post claimed to be a literature review, I might have been remiss in not referring to it. But my post was in response to the discussion of the so-called "secret World Bank report", not a general discussion of all the reports that have investigated the link between biofuels and food prices. I could equally demand of you that every time you write about biofuels that you mention, and include a link to, the studies by the Global Subsidies Initiative.
Objectivity, Jonas, in my view means judging work on its merits, and not claiming higher authority for the authors because they happen to work at Wageningen, or Moscow State University, or Universität Tübingen, or wherever. Similarly, it is highly subjective of you to dismiss out of hand a piece of analysis that you have not even seen simply because it was done by somebody who works for the World Bank, which you seem to regard as the institutionalization of all evil. You should learn to keep your feelings for an institution separate from the individuals who work for it.
As for the study by Martin Banse et al. (2008), a lot of it concerns long-term trends. Their analysis of short-term trends is written in a rather telegraphic style, and does not assign values to the individual factors.
I wonder, also, if they fully understand what drives the derived demand for biofuel feedstocks. They assert, for example, that:
"[I]ncreasing food and feedstock prices make biofuels less profitable and food more profitable. This shifts production back to food (in US is this already visible; Trostle 2008, p.17).
But since they don't provide a list of references, I cannot verify that. Do they understand the full extent of the subsidies for biofuels, and the fact that until mandated volumes are filled, biofuel producers can outbid other buyers of the feedstock? They also speak of the poor economics of producing biodiesel in the United States. Are they aware of the phenomenon of "splash and dash"?
The fundamental difference between Don Mitchell's analysis and that by others, which is what makes it interesting, is, as I mentioned earlier, that he asks what would have happened to prices in the absence of grain- and oilseed-based biofuels, and then considers biofuels as the residual factor. Others, essentially, take a particular starting date and then treat each factor contributing to rising demand for grains and oilseeds from then on as having a weight in the price rises proportional to their added volume.
These are only my personal opinions.
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Biodiversivist Posted 9:44 am
06 Jul 2008
-The right says: "producing biofuels is a crime against humanity".
America's biggest biofuel proponent is uncurious George, followed closely by Khosla, also a lifelong Republican.
In the end, it all comes down to biodiversity. Poison Darts--Protecting the biodiversity of our world
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Biodiversivist Posted 9:54 am
06 Jul 2008
In the end, it all comes down to biodiversity. Poison Darts--Protecting the biodiversity of our world
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Jon Rynn Posted 10:39 am
06 Jul 2008
Biofuels are throwing oil (I guess pun intended) on the fire of soil and water depletion (I guess this is my subjective comment). The underlying, fundamental problem is soil and water. small-scale, food for a small planet-type farming, permaculture, biointensive, these techniques build up the soil and save on water.
And Jonas, we've been through this, there is a big difference between indigenous peoples sustainably harvesting biomass for things like direct electricity generation, and huge multinational agribusiness destroying whole ecosystems (and not giving anything back to the colonized).
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freewin Posted 12:24 pm
06 Jul 2008
And we want to grow fuel so we can drive to the supermarket and buy increasingly higher priced food.
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Delay And Deny Posted 2:54 am
07 Jul 2008
If the Greens would stop interfering with the human ecosystem, everything would be fine.
Look, every time a country industrializes, it creates fewer and more prosperous people. The faster we get the more backward people (those who don't live in Seattle or New York) to get higher incomes and start living in city condos and not having a kid until they're 42 (and only one at that), the faster we can all stop worrying about all the other stuff.
Eventually the world will be made up of 500 million weight conscious guppies (Green Yuppies) who's most pressing concern is reading Grist to see what the latest Prius accessory is.
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Ron Steenblik Posted 4:38 am
07 Jul 2008
These are only my personal opinions.
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Jon Rynn Posted 5:27 am
07 Jul 2008
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1Eco Posted 1:28 pm
07 Jul 2008
Not all feedstocks are equal. In fact biofuels can be made from biomass and soon will be, if I have my guess.
Ecosystems empowerment for the rural poor.
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amazingdrx Posted 2:52 pm
07 Jul 2008
That means biogas (methane) or natural gas can be substituted for gasoline and diesel.
Biogas can be made from coal too. Underground with no mining, just by injecting natural bacteria.
The natural gas we presently use for heating can be replaced with solar PV/heat cogeneration and ground source heat pumps.
The danger is that gas guzzling will continue, as natural gas is only $1 per gallon of gas equivalent. Plugin hybrids should compliment these other changes to make the price of natural gas stabilize.
http://amazngdrx.blogharbor.com/blog John Schneider, Northern Wisconsin
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Ron Steenblik Posted 4:07 pm
07 Jul 2008
Driving up the price on everything other than U.S. Real Estate.
Not true. Here are the results of the 2007 Iowa Land Value Survey [130 kb PDF] of farmland values in the State of Iowa:
Year $/acre % change
1999 ... 1,781 ... -1.1
2000 ... 1,857 ... 4.3
2001 ... 1,926 ... 3.7
2002 ... 2,083 ... 8.2
2003 ... 2,275 ... 9.2
2004 ... 2,629 ... 15.1
2005 ... 2,914 ... 10.8
2006 ... 3,204 ... 10.0
2007 ... 3,908 ... 22.0
Farmland values in the center of the corn belt doubled between 2001 and 2007, increasing by a whopping 22% between 2006 and 2007. Has your land increased in value so quickly?
These high land values are the results of expectations of higher returns from farming -- in this case, higher returns that are to a large extent the result of policy. This is why production-linked policies (as opposed to payments for environmental improvements), such as those supporting biofuels, are so difficult to change once they have become established: the rents (money earned above the normal returns to factors of production) become capitalized into the value of fixed assets, in this case land.
If the support for corn-ethanol and soy-biodiesel were to be suddenly ended, land prices would fall, and some of those farmers who borrowed heavily using the value of their land as collateral could run into financial trouble.
These are only my personal opinions.
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Ron Steenblik Posted 8:08 pm
07 Jul 2008
If you need an explanation for why farm subsidies, and biofuel support policies in particular, can so easily become entrenched, all you have to do is cite that one figure.
These are only my personal opinions.
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John former Marine Posted 10:28 pm
07 Jul 2008
Il faut cultiver notre jardin.
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timbuktu Posted 7:30 am
08 Jul 2008
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Amber Pearson Posted 7:49 am
08 Jul 2008
Read the Wall Street Journal article: http://blogs.wsj.com/environmentalcapital/2008/07/07/bad- ... .
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Ron Steenblik Posted 11:28 am
08 Jul 2008
The World Bank is now on record refuting that this unfinished paper reflects its position on biofuels.
The WSJ is right, to the best of my knowledge. But "refute" is Ms. Pearson's interpretation. The phrasing I would use is "The World Bank is on record saying that Mitchell's draft paper does not necessarily reflect its position on the contribution of biofuels to food prices", which would be more in keeping with the author's first footnote (there from the beginning), which states that "The views expressed in this paper are those of the author and should not be attributed to the World Bank or its Executive Directors." That is a standard caveat in these kinds of staff analyses.
But, of course, it does not mean that the analysis is any less valid for it.
These are only my personal opinions.
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Ron Steenblik Posted 12:13 pm
08 Jul 2008
G8 discussion centers on biofuel
Malaysia News.Net
Tuesday 8th July, 2008
The biofuel policies of wealthy countries have been on the agenda at the G8 conference in Japan.
World Bank President Robert Zoellick has called for reform of food resources, urging countries to grow more food to feed the hungry.
Speaking on the sidelines of the summit on Hokkaido island, Mr. Zoellick said biofuels had largely caused massive food price rises.
He laid particular blame on fuels made from corn and rapeseed and said both the US and Europe need to take action to reduce tariffs that benefit grain and oil seed biofuels but take food off the table of millions. [My emphasis]
If the above is an accurate reflection of what Mr. Zoellick said, it doesn't sound like much of a refutation to me!
These are only my personal opinions.
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Biodiversivist Posted 12:51 pm
08 Jul 2008
Are you seeking the truth or just doing your job?
"Amber is the Communications Specialist for the National Biodiesel Board. Amber's primary role is public relations efforts such as media relations.
http://www.biodiesel.org/aboutnbb/whoarewe/staff.shtm
Reality gets pretty slippery when there is an incentive for it to do so.
"It is difficult to get a man [or woman] to understand something when his [or her] salary depends upon his [or her] not understanding it." --Upton Sinclair
Biodiesel made from soy also uses four times more land than even corn ethanol, is destroying biodiversity and increasing global warming via crop displacement, all for what again? Certainly, increasing liquid fuel supplies 2% isn't going to make us safe from our numerous enemies. I suspect it is a combination of good intentions paving the road to hell and a way to buy votes using fellow citizens hard earned money to line the pockets of American farmers and industrial agriculture lobbyists.
I lifted the WSJ piece to highlight some things:
Bad Juice II: Biofuels Maybe Not Quite So Bad, World Bank Says
Posted by Keith Johnson
The biofuels battle just gets hotter.
We just wrote about the Guardian story on a World Bank report allegedly blaming biofuels for 75% of the recent rise in fuel prices, and which was reportedly suppressed for political reasons. Alas, it ain't so, Joe, the World Bank says.
Bob Davis of the WSJ spoke with Donald Mitchell, the author of the draft report--which wasn't secret at all, but a working paper. And like all working papers, it doesn't reflect the official position of the World Bank.
The report was meant to contribute to a World Bank position paper on rising food prices, which was released at the Bank's spring meeting in mid-April.
The final April report didn't include his specific calculation. But, Mr. Mitchell says, "I never saw that as political." Instead, he says he believes the changes were made because of "editing." He said that he has been encouraged by World Bank management to explore the issue of biofuels and the overall rise in food prices. "I had input" into the final report that was released at the spring meeting, he said.
Mr. Mitchell said that because of the publicity engendered by the Guardian piece, the World Bank is trying to put out a polished version of his report by the end of this week.
A World Bank spokesperson added:
[Mr.] Mitchell is still getting input from peer reviewers and the paper is still being finalized. As a result, the Bank chose not to use a specific figure in the Spring Meetings and G8 papers. As [World Bank boss Robert] Zoellick said today in Japan: "That's an internal study that we've been circulating to people to try to get different views from other aid agencies and different economic analyses. So, my own view is that that is probably at the far end. You see other people talk about ranges of 20 percent, 25 percent. There's s some at the lower end that I think are less credible. So, on this one I think I'm going to rely on the experts to be able to sort it through."
The draft itself--which we saw--makes clear that the headline figure for biofuel's role in the food crisis was a little overstated in the original article:
Thus, the combination of higher energy prices and related increases in fertilizer prices, and dollar weakness caused food prices to rise by about 35 percent from January 2002 until February 2008 and the remaining three-quarters of the 140 percent actual increase was due to biofuels and the related consequences of low grain stocks, large land use shifts, speculative activity, and export bans.
Not that biofuels are off the hook entirely. The draft report did say: "Increased biofuel production has increased the demand for food crops and been the major cause of the increase in food prices." That's still a stronger indictment of biofuels than most other recent studies, draft or otherwise.
In the end, it all comes down to biodiversity. Poison Darts--Protecting the biodiversity of our world
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amazingdrx Posted 12:55 pm
08 Jul 2008
http://amazngdrx.blogharbor.com/blog John Schneider, Northern Wisconsin
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persimmon Posted 1:58 pm
08 Jul 2008
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Biodiversivist Posted 3:08 pm
08 Jul 2008
Wind and solar do not destroy carbon sinks, biodiversity or increase GHG.
Soy, rapeseed, and palm biodiesel are not innovative, they are centuries old.
That's the problem with letting government invest billions in carbon sequestration, hydrogen filling stations, nuclear power, or food based biofuels. When the public finally realizes they have been screwed it is too late to back out because people with jobs to lose fight tooth and nail to keep them, understandably.
We may not be bright enough to pull this off.
In the end, it all comes down to biodiversity. Poison Darts--Protecting the biodiversity of our world
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Ron Steenblik Posted 3:52 pm
08 Jul 2008
Today's biofuels are not the answer and are by no means perfect, but we're getting there and if we pull funding now we'll be in an even bigger mess.
We're getting where? The dominant biodiesel technology, transesterfication (essentially, large-scale kitchen chemistry: mix a fat or oil with an alchohol in the presence of a catalyst), is well understood. And as long as it relies on conventional vegetable oils it is not scalable without either affecting food supplies or creating demand for new croplands (and all the consequences for biodiversity and disturbance of carbon sinks).
Many people are excited about the prospect of obtaining oils from micro-algae. But the technology is still experimental. Good luck is all I can say. But I fail to see how the current $1.00/gallon federal tax credit (plus a new $0.75/gallon state subsidy in Pennsylvania and a $1.00/gallon state subsidy in Kentucky, to name just two examples) is helping that technology along. The challenge for micro-algae lies not with the technology for turning the plant oil into biodiesel but in growing and harvesting the oil from the algae on a large scale.
Meanwhile, the $1.00 federal tax credit is providing a nice income for somebody. Last year, for example, the United States exported 1 million metric tonnes of biodiesel exports to Europe, at a cost to the U.S. Treasury of around $300 million. This year, the bill could be even higher.
Where that has gotten us is into a budding trade dispute with the European Commission.
These are only my personal opinions.
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Biodiversivist Posted 4:15 am
17 Nov 2008
In the end, it all comes down to biodiversity. Poison Darts--Protecting the biodiversity of our world
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Whiskerfish Posted 6:05 am
17 Nov 2008
Highly efficient cellulosic or '3rd generation' biofuels (presuming such things come to pass) are not likely to change this -- they are simply likely to make land theft, deforestation and unsustainable water use more profitable, and hence more widespread.
People like Jonas can carry on sticking their heads in the sand, or they can wake up and smell the last wildlands of Africa burning to feed this madness. Biofuels are not a chance for the 'South' to get rich. They are merely another excuse for corrupt Third World elites and their multinational enablers to screw the poor out of their most valuable asset, their land.
Simple.
Whiskerfish in Africa
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