Friday, January 5, 2007

Corn Shortage Means Death for All

The NYTimes reports today that, due to massive demand for ethanol, there may not be enough corn left over as food. Choice quotations:
Renewing concerns about whether there will be enough corn to support the demand for both fuel and food, a new study has found that ethanol plants could use as much as half of America’s corn crop next year.
Farmers have always responded to price signals from the marketplace and, historically, we have had much more challenge with overproduction than shortage.

Dozens of new ethanol plants are being built by farmers and investors in a furious gold rush, spurred by a call last year from the Bush administration and politicians from farm states to produce more renewable fuels to curb America’s reliance on oil
Something tells me these plans are being spurred by massive subsidies, not a call from W. And something tells me that supply and demand will still intersect somewhere...

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