Ethanol

Speaking of engines ......

I was filling my gas tank in the USA and noticed that the fuel there contains at least 10% ethanol, the source of which, is food. I had just heard, minutes ago, that the severe droughts in the USA were devastating the corn crops and in many areas the crops were a complete write off. This year will experience the lowest corn yields since 1995 and the highest prices, ever!

"Corn is the single most important commodity for retail food," Richard Volpe, an economist for the USDA told the Los Angeles Times. "Corn is either directly or indirectly in about three-quarters of all food consumers buy."

The last time corn prices spiked, there were price driven food riots over many parts of the world. Why then is 40% of all corn grown used for fuel? Ethanol is a sticky substance that destabilizes when sitting in a gas tank, thus making engines, especially small engines difficult to start after remaining idle for a while. It also gunks up engines that run on it for any length of time, thus a myriad of fuel additives and engine cleaners have evolved to solve the problem. The trucking industry refuses to use ethanol fuels because they run "dry" causing the engines to break down early in their career. Boaters and aviators will not use ethanol based fuels because of the potential problems.

This whole ethanol business was mandated by the government in 2005 based on the assumption that traditional fuel, petroleum, was unsustainable and therefore had to be supplemented. There was also the whole carbon issue which was a farce because the carbon produced to create one litre of ethanol exceeds the carbon saved when burning it. But that is government thinking at its best. Tinker with the market in order to save the world. As it turns out, the world is discovering unprecedented oil reserves, while the precious corn crops that can feed the world are being converted into ethanol.

If you think that you can avoid food price increases by not buying corn, think again. Animal feed with corn in it is more expensive and that cost trickles down to chicken, beef, eggs, dairy, and the vast amounts of food containing high fructose corn syrup.

Once a government program is in place, it is almost always there in perpetuity. Maybe this time a famine and a good dose of food riots will change that reality.