More about the coming ethanol train wreck

[royalfan5]

http://www.journalstar.com/articles/...6066474346.txt

More about why corn-based ethanol isn't a sustainable solution to the nation's energy issues. Mass corn based ethanol production is going to punish livestock producers severely, and be inflationary to our food prices, and not make much of dent in our foreign oil dependence. Simply put we don't have enough acres for the corn we need, and we aren't getting it from somewhere else because right now we are the only people with corn to export. America's pursuit of instant gratification through legislation and bad policy will cause more problems than they fix yet again.

[crawfish]

Yet another reason why Nebraska sucks.

[royalfan5]

Yet another reason why Nebraska sucks.

Don't forget Iowa, Illinois, and Minnesota. Plus, the mind numblingly stupid tax credits and tariffs on ethanol.

[IronSooner]

While I'm not familiar enough with the science of it, I've heard it actually operates at an energy deficit, costing more energy to produce than it yields. Seems like that'd be something to look into...

[royalfan5]

While I'm not familiar enough with the science of it, I've heard it actually operates at an energy deficit, costing more energy to produce than it yields. Seems like that'd be something to look into...

It doesn't operate at any energy deficit, that study like to pretend we are raising corn like we did in the 1970's. The fact that we need to come with 13 million more acres by 2008 just to keep pace is the problem, and that higher prices will knock the **** out of livestock producers, especially pork and chicken producers.

[OklahomaTuba]

I don't think ETH will ever go away. Too much legislated demand for it.

Verasun is getting ready to build yet another plant I just heard. Probably based on their new technology to produce ETH and biodiesel from multiple feedstocks.

[mdklatt]

http://www.journalstar.com/articles/...6066474346.txt

More about why corn-based ethanol isn't a sustainable solution to the nation's energy issues. Mass corn based ethanol production is going to punish livestock producers severely, and be inflationary to our food prices, and not make much of dent in our foreign oil dependence. Simply put we don't have enough acres for the corn we need, and we aren't getting it from somewhere else because right now we are the only people with corn to export. America's pursuit of instant gratification through legislation and bad policy will cause more problems than they fix yet again.

You mean we can't get something for nothing?? DAMMIT!

[royalfan5]

I don't think ETH will ever go away. Too much legislated demand for it.

Verasun is getting ready to build yet another plant I just heard. Probably based on their new technology to produce ETH and biodiesel from multiple feedstocks.

I don't think it will go away either, but there will be a lot of people losing money because of it in the near future. The corn belt will go corn-deficit shortly. When you have to start railing corn into Nebraska and Iowa, you aren't going to be making money.

[OklahomaTuba]

I don't think it will go away either, but there will be a lot of people losing money because of it in the near future. The corn belt will go corn-deficit shortly. When you have to start railing corn into Nebraska and Iowa, you aren't going to be making money.

What really needs to happen is the government just back off and let the market figure it out. Thats the only way things can work out.

[royalfan5]

What really needs to happen is the government just back off and let the market figure it out. Thats the only way things can work out.

exactly. But that would require rationality from the gov't.

[tbl]

I wonder if hemp oil causes the same problems...

[49r]

...dude...


what?

[GottaHavePride]

I thought the biodiesel research was sounding pretty promising. didn't they put a test facility next to one of the Tyson chicken plants?

[Tear Down This Wall]

Oil and gas work the best. We have plenty of it. The problem is that is spineless politicians want tourists in their states instead of drill rigs offshore. Fine. Pay your higher gas prices and shut up.

As for the cost of ethanol...all of the alternative fuel sources currently cost most to produce than oil and gas. But, because people have their heads shoved up their as*ses, we're trying to implement them before they're perfected.

Yes, it's stupid, but that's America. It makes enough idiots "feel good" about the environment, so we do it.

[Ike]

The problem is this: as the news media outlets are reminding us, the Iowa caucuses are only a year and a half away or so. So all the potential candidates have to go out there and ramp up their rhetoric so that they will be percieved as good folk by the farmers. Farmers probably like ethanol, because it gives them yet another reason to stick with farming. So even if it is ultimately bad, nobody in washington really cares.

That said, I think some (moderate) inflationary pressure on food prices isn't a terrible thing.

[royalfan5]

The problem is this: as the news media outlets are reminding us, the Iowa caucuses are only a year and a half away or so. So all the potential candidates have to go out there and ramp up their rhetoric so that they will be percieved as good folk by the farmers. Farmers probably like ethanol, because it gives them yet another reason to stick with farming. So even if it is ultimately bad, nobody in washington really cares.

That said, I think some (moderate) inflationary pressure on food prices isn't a terrible thing.

grain farmers think it's a good thing. Livestock farmers get railed.

[Ike]

grain farmers think it's a good thing. Livestock farmers get railed.

possibly. But then they just pass that price along to the consumer ultimately.
There are some that say grain farmers are getting railed right now.


Still, Ethanol isn't a cure-all for energy. I don't think anyone thinks it will be.

[royalfan5]

possibly. But then they just pass that price along to the consumer ultimately.
There are some that say grain farmers are getting railed right now.


Still, Ethanol isn't a cure-all for energy. I don't think anyone thinks it will be.

Livestock finishers are price takers. They have take what the packers give them for prices on the open market, and pay open market prices for feeders. Swings in grain prices chew up the small margin they live on. The packers pass the price along to the consumer, not the producer. Livestock also isn't subsidized by the gov't directly, like grain farmers. Grain prices are very good right now, and stocks are historically tight. When grain stocks are tight, and grain is worth more as grain than on the hoof, bad things start happening to agriculture and the consumer. Meat prices will rise when livestock producers start going under in droves decreasing supply. Dairy Farmers have been getting hammered all year, and it's going to be pork and beefs turn real soon. Once the agricultural equilibrium gets thrown off, it will cause a lot of problems. The United States will have to decide between food or fuel soon.

[Tear Down This Wall]

The problem is this: as the news media outlets are reminding us, the Iowa caucuses are only a year and a half away or so. So all the potential candidates have to go out there and ramp up their rhetoric so that they will be percieved as good folk by the farmers. Farmers probably like ethanol, because it gives them yet another reason to stick with farming. So even if it is ultimately bad, nobody in washington really cares.

That said, I think some (moderate) inflationary pressure on food prices isn't a terrible thing.

Excellent point. I discussed politicians with my dad at lunch. We think its funny that so many think we buy into their crap. There's a reason so few politicians really get out and talk to people in uncontrolled settings...we'd actually tell them how stupid they were to their faces.

[Ike]

As for the cost of ethanol...all of the alternative fuel sources currently cost most to produce than oil and gas. But, because people have their heads shoved up their as*ses, we're trying to implement them before they're perfected.

There is some validity to this argument, but then there is the other side of the coin. At some point (the exact date of which is currently unknown, but it is possible that it will occur within my lifetime, or perhaps my kids lifetime), as more and more countries develop and have more energy needs, demand for oil and gas will surge past the planets ability to produce it. this will create a fairly large energy crisis, here and everywhere else. It's true that none of the alternatives are perfected yet, and even when they are they may or may not be a cheaper alternative to oil and gas. Still though, in anticipation of a future energy crisis, it makes sense to explore alternatives and push to perfect them so that when the oil crisis hits (and it will, just who knows when), we'll have a backup plan ready to go.

Now, one can argue about how bad the coming oil crunch will be...it could be a slow building kind of pressure, in which case market forces would probably produce a solution all by themselves....or it could be much worse if we suddenly see a spike in world oil demand at the time when production starts to taper off. In that scenario, I don't know that market forces would be able to react quickly enough to make a near-seamless transition to alternative energy sources, and things could be tumultous enough to put us at great risk.

So with a worst-case scenario in mind, perhaps it's prudent to create enough financial incentive for the markets to tinker around with alternative energy in the hopes that something will be available to take over when oil and gas go kaput.