Curmudgeon's Corner

Corn For Food, Or Corn For Ethanol?

Posted by Al Campbell on July 17, 2012

U.S., Wisconsin, Political, Quality of Life, Economy

Do we prefer to use corn for ethanol or for food and food stock for animals and poultry?

We are obviously experiencing a severe drought in our corner of the world.  That threatens the corn crops; those will either be greatly diminished or, in some cases, nonexistent. Every 2.8 gallons of ethanol consumes 1 bushel of corn.  At the same time we are subsidizing the production of ethanol at the rate of about $0.45 per gallon from taxpayer’s dollars.  We also pay some 10% more for the gasoline that contains ethanol while obtaining some 10% lesser fuel efficiency according to my experience anyway.

We are also witnessing rapidly increasing food prices since corn and its derivatives are a common part of the foods we consume.  The price of better cuts of beef has increased by nearly $1.50 per pound in the past couple of weeks according to grocers.

Are we at the point where our government ought to cause ethanol production to be severely reduced or cut out entirely in order to have lower priced food in greater quantities?  Are we at least at the point where the debate ought to commence?

Of course, this is the high season of presidential elections, so there is a price to be paid for either espousing such discussions or for ignoring the possibility.  Farmers affected by the drought may have purchased ‘crop insurance’ in which case they will get some compensation for the damaged or ruined yield to at least offset part or all of their costs of planting.  There are some huge corporations involved in the agricultural world, and they have a lot of financial clout from the perspective of candidates running for office.

Is the curtailment of ethanol production a good idea or would that have more repercussions than benefits?

Corn for food or corn for ethanol?