Using food for fuel
June 17, 2008
A few years ago, using food to produce fuel seemed like an inspired idea. Instead of buying all of our gasoline from oil-rich nations, we would forgo eating a few ears of corn each summer, and voila, a cleaner version of petrol would flow into our tanks.
In 2007, Congress mandated that refiners blend 15 million gallons of corn-based ethanol with our gasoline by 2015.
Now, some environmentalists and food industry experts argue that the legislation has pushed the price of corn and soybeans sky high, not to mention most items on the average grocery shopper’s list.
On Tuesday, local food organizations, like the Maryland-Delaware-DC Beverage Association, the Maryland Retailers Association and restaurateurs joined the national Food Before Fuel Campaign to urge Congress to revise its ethanol policies.
Their argument is that although other factors like high energy prices, poor weather and rising agricultural demands are contributing to the rise in food prices, the increased demand for ethanol is an unnecessary part of the equation. Legislators may not be able to control the weather – including floods ripping through the Corn Belt – but they can do something about the ethanol mandate.
Not everyone agrees. The Maryland Grain Producers suggest that the production of corn-based ethanol only accounts for 3 percent of the rise in food prices, while energy costs have a much bigger responsibility for the increase. (PDF)
The grain group quoted analysts at Merrill Lynch, who said without biofuels, the price of a barrel of oil would be $13 higher than it is today.
Too bad for us, the price of a barrel could easily jump $13 in the next week.
DANIELLE ULMAN, Business Writer
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