Food for Fuel, Again
- October 14, 2011
- 29 views
For every 10 ears of corn that are grown in the United States today, only 2 are consumed directly by humans as food. The remaining 8 are used in almost equal shares for animal feed and for ethanol. And, for the 12 months from August 2011 to 2012, the U.S. biofuels industry used more corn for fuel than domestic farmers did for livestock feed – a first for the industry. This significant milestone in the shifting balance between crops for food versus fuel shows the impact of government subsidies for the biofuels industry. And, it could represent a tipping point in the conflict between food and fuel demand in the future.
According to Rabobank’s head of agricultural research, Luke Chandler, this shift in the balance between food and fuel could be the tipping point in world grain markets. China, once able to supply its internal corn demand, currently expects to import (from the U.S.) a few million tons of corn next year. This will likely place additional stress on the United States corn industry, as it will introduce another source of demand (and corresponding market pressures) for the nation’s corn harvests.
See the article — a blog posting on the Scientific American site — for more details on the potential for a (long overdue) legislative correction to this mess. I will believe we have a major change in this area when I see it.
Even without major subsidies promoting the use of corn for fuel, it’s not going away. There’s far too much infrastructure devoted to it already for that to happen. Significantly reduce or eliminate those subsidies and we will surely see more corn being sold for consumption, whether to China or some other foreign market, or used domestically, as well as less corn grown overall. But I would be surprised to see the portion of the US corn crop turned into fuel drop from its current level of roughly 40% to less than 25% in the first five years. That’s still a hell of a lot of ears of corn being used to maintain our fossil fuel addiction.
Which brings me to the point of this post: How much longer will the US be able to persist in this absurd practice of turning food into fuel before it becomes a diplomatic hindrance? In a world where rising population, shifting dietary patterns (more people around the world trying to eat American-style diets, in essence), and climate change and its various temperature and water related impacts all have us on a path for greatly increased food stress, turning over 100 million tons of corn into motor fuel at current rates doesn’t seem like a particularly prudent — or humane — path.
 I know this is somewhere between anecdote and real data, but I can’t help but mention what my wife and I have seen first hand, in terms of corn production even in NY and PA. We visit relatives several times every year in PA, and we’ve noticed over the last few years a conspicuous jump in the number of very small fields planted with corn. Along our route we see many dozens of these small plots, some under an acre I’d guess, up to a few acres at the high end, right next to various highways, all planted with corn. This was land not used for any farming at all in prior years or used for something much less obvious than corn. I’m not suggesting that the Keystone State and the Empire State are about to challenge Iowa and Nebraska for corn production, but it certainly looks like an obvious and expected reaction to market conditions.