30 Nov 2006
Corn Prices Surge to 10-Year Highs

This may be good news for grain farmers, but watch out! Higher food prices are on the way. The feed I buy for my chickens has gone up by a penny a pound since July, and more increases are on the way.

The upshot of all this is that it's not caused by market forces, really. It's another government intervention, and a stupid one at that:

David Pimentel, a professor of ecology at Cornell University who has been studying grain alcohol for 20 years, and Tad Patzek, an engineering professor at the University of California, Berkeley, co-wrote a recent report that estimates that making ethanol from corn requires 29 percent more fossil energy than the ethanol fuel itself actually contains.

Ethanol is not going to make us "energy independent" - it's going to give us higher food prices, higher taxes and make us more dependent on foreign oil than ever. In other words, just a classic bureaucratic bungle.

Corn prices on the Chicago Board of Trade rose sharply to 10-year highs Thursday, on concerns about the size of the U.S. corn crop and ongoing demand for ethanol.

(link) [Examiner.com]

11:14 /Agriculture | 1 comment | permanent link