Author: Elaine Shannon
Website: http://www.enviroblog.org/2009/05/higher-ethanol-fuel-looks-…
Corn prices are projected to reach $5 a bushel this year, thanks to heavy rains in the corn belt and fewer acres planted. That’s good news for corn farmers, who have watched prices sag after last year’s record highs past the $7 mark.
But it’s not so good for consumers, who can expect higher food prices.
And it puts even more stress on the corn-based ethanol industry, which ramped up too big, too fast in mid-decade and then suffered a flurry of bankruptcies and lagging demand.
Ethanol industry desperate
As reporter Philip Brasher of the Des Moines Register pointed out in a smart analysis yesterday, “Biofuels producers didn’t take into account sufficiently the potential risks of a downturn in energy prices, or the possibility that agricultural commodity prices could increase sharply.” Also, Brasher writes, “Their dependence on the government created another risk for the industries.”
Fact is, there wouldn’t be much of a market for ethanol if the 2007 energy…
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