Healthy soil and sustainable growing

["TradingPostPaul" <tradingpost@riseup.net>]

Some of us have been warning about this no-win tradeoff for months. How
obvious does it have to get? 

paul tradingpost@lobo.net
-------------------

CORN: FUEL OR FOOD ???
By Mike Meyers Minneapolis-St. Paul Star Tribune
February 8, 2007
http://www.startribune.com/535/story/977495.html

Full fuel tanks could mean many more empty bellies within the next two
decades, according to new research by two University of Minnesota
economists.

The number of hungry people worldwide could grow by more than 50% by 2020,
as corn, sugar and other food staples are increasingly devoted to making
fuel here and abroad, according to the projections by C. Ford Runge and
Benjamin Senauer.

The same trend would bring much higher food prices to the United States and
the rest of the developed world, the economists predict. The sharp increase
in world hunger isn't inevitable, however. The economists say increased
conservation could do more to wean the United States from foreign oil than
all the corn-based ethanol plants now online.

Corn and ethanol producers dispute the claims. 

"Based on the numbers and the amount of ethanol we're producing, there's
not a negative implication for corn destined for the rest of the world,"
said Jeffrey Zeiger, executive director of the Alternative Fuels Institute,
a nonprofit group based in Watertown, South Dakota. However, pork, poultry
and egg producers are beginning to sound alarms of their own about
ethanol's impact on food prices.

Some aspects of the scenario laid out by Runge and Senauer already are
coming to pass. This winter's imposition of tortilla price controls in
Mexico in an attempt to quell unrest is an early indication of the
consequences of food price shocks, the two write. "These impacts are
[already] being felt right at America's doorstep --- in Mexico."

Runge and Senauer's forecast stands in contrast to their views of only four
years ago and shows how quickly the mathematics of food production are
being changed by the worldwide push for biofuels.

In 2003, Runge and Senauer forecast that the rise of both agricultural
output and Third World incomes would ease world hunger. They expected the
number of hungry people in the world to fall 23%, from 830 million at the
end of the 20th century to about 625 million in 2025. They now believe the
ranks of the world's hungry will rise to 1.27 billion people by 2020.

"But if staple food prices increase [as is now expected]," the economists
warn, "the number of undernourished people could climb by 600 million or
more by 2020. Many would be over the edge of subsistence into outright
starvation," their paper warns. "Many more would die from a multitude of
diseases."

Ethanol plants are on pace to consume more than 35% of the U.S. corn crop
within a few years, and their growth rate has attracted the notice of food
producers who rely on corn in the production of everything from cereals to
butter and meat.

Richard Bond, president and CEO of chicken producer Tyson Foods, said last
week that the country must "carefully consider the negative and unintended
consequences of over-using grains" for fuel. "Companies will be forced to
pass along rising costs to their customers, meaning consumers will pay
significantly more for food," Bond said. "If left unaddressed, the bigger
long-term issue will be the availability of U.S. and global grain for
protein and other foods."

In a speech last year, Warren Staley, CEO of Cargill, the Minnetonka-based
commodities trading firm that also has invested millions in ethanol plants,
said fuel shouldn't displace food as the primary reason for growing crops.
"We have to look at the hierarchy of value for agricultural land use: Food
first, then feed and last fuel," Staley said. "Today we are providing
subsidies to fuel uses while often erecting barriers to new food and feed
technologies."

Zeiger of the Alternative Fuels Institute rejects the argument that hunger
will rise worldwide as the use of biofuels increases. U.S. food prices are
bound to rise in the short term as millions of tons of corn are diverted to
new ethanol plants. But new technologies for producing ethanol from other
crops or grasses will ease the need for corn, Zeiger said.

Mark Hamerlink, a spokesman for the Minnesota Corn Growers Association,
pointed out that corn prices rise and fall in cycles and that Mexican
tortilla prices didn't rise five-fold, as they have in recent months, when
U.S. corn prices spiked to $4.66 a bushel in the mid-1990s. "There's some
faulty logic on what may be going on south of the border," he said.

Hamerlink blames the soaring tortilla prices on corn speculators in Mexico.
Runge and Senauer counter that Mexico was far less dependent on U.S. corn a
decade ago. The NAFTA treaty opened the U.S.-Mexican border to increased
trade, making the two countries' grain markets, and grain prices, much more
interlinked.

Senauer, co-director of the U's Food Industry Center, said Mexican
speculators have aggravated rising food prices but are not the source of
the phenomenon. "Certainly, one reason for the increased price of tortillas
is that Mexico imports much of its corn from the U.S.," Senauer said. "As
prices of the commodity have soared, so has the cost of tortillas,
prompting the Mexican government to impose price controls on the staple
food in the face of hoarding and speculation."

By the two economists' reckoning, every one percent rise in the price of
staple foods translates into another 16 million people worldwide going
hungry. And they forecast that the prices of many grain staples will rise
by 11% to 40% just by 2010, with steeper increases coming afterward. Of
course, growers can plant more corn, but often at the expense of other
crops.

For instance, Runge and Senauer note estimates by U economist Verne Eidman,
who projects a decrease of 3.3 million U.S. acres planted in soybeans by
2010-2011. "At the same time ... [soybean's] myriad food processing uses
are projected to increase in price by 27%," Runge and Senauer write.
"Meanwhile, the price of soybean meal used to feed livestock will increase
eight percent, while the farm price of soybeans increases only four
percent. "This illustrates an important aspect of 'downstream' price
impacts of biofuels: They have the effect of cracking the whip on the
prices of products for which corn and soybeans are used," the authors said.

While the topic is complex, the pair used simple arithmetic and numbers
derived from many well-recognized sources --- from the World Bank and
United Nations to the Department of Agriculture --- to peer into what might
be ahead in the competition of food and fuel for crops.

Spurred by high oil prices and large government subsidies, ethanol
production has been growing fast, with 110 U.S. ethanol refineries running
at the start of 2007. From September 2005 through August 2006, the USDA
reported 1.6 billion bushes of corn went to U.S. ethanol plants, or 15% of
the crop.

But some 73 more plants are under construction, or an increase of
two-thirds in less than two years when the new facilities come online by
2008. Feeding those plants will raise total ethanol demand, "requiring 35
percent of the total corn crop even in a good harvest," they write.

And if corn-based ethanol delivered all of President Bush's call for 35
billion barrels of "alternative fuels" by 2017, reaching that goal would
require 107% of the current corn crop, Runge calculates. Meanwhile, 82
low-income countries already suffer "food deficits," by U.N. measures, even
before the effects of food-to-fuel take hold.

While researchers are working on ways to make ethanol from switch grass and
prairie grasses, breakthroughs might be years or decades away. And Runge,
director of the U's Center for International Food and Agricultural Policy,
believes it will be a challenge to change course from an alternative fuel
production system being built now to run largely on corn, given the array
of subsidies that have been instituted to support ethanol plants.

"It's hard to find a politician anywhere who isn't doing cartwheels
cheerleading for ethanol," Runge said.

Lester Brown, president of the Earth Policy Institute, a Washington-based
think tank, said it might take a sustained rise in food prices to change
policymakers' thinking. "What we may see before too long is a consumer
response, kind of a backlash against the ethanol industry," Brown said. At
a recent agricultural conference, Brown said, soybean growers, pork and
poultry producers agreed that higher corn feed prices will inevitably
leading to higher food prices.

"When you think of what's in your refrigerator, it's stuffed with corn
products --- the meat, the butter, the eggs, the ice cream" all depend on
corn feed, Brown said. "There may be 100,000 corn growers in the country,
but there are 300 million consumers."