ETHANOL MANDATES AND ECONOMICS IN THE US
Government mandated ethanol in gasoline is causing increases in the cost of gasoline, food and the cost of living. United States Government laws mandating ethanol in gasoline as an alleged energy saving and environmental protector not only are incorrect, they are counterproductive as they actually increase energy use and help destroy the environment.
Ethanol is an inferior fuel for gasoline. Ethanol is 35% by weight of non-combustible oxygen as oxygen will not burn in spite of common misconception. Ethanol is hydroscopic meaning it attracts water which attracts oxygen and helps cause rust in any ferrous parts, carburetors and fuel lines. Aluminum, brass and bronze are also somewhat incompatible with ethanol. Ethanol has other disadvantages. The approximately 35% less energy available from ethanol compared to gasoline means that all vehicles that use gasoline need to burn more fuel and create more exhaust gases. Shipping unusable oxygen in the form of ethanol is a waste of energy and counterproductive at best.
Ethanol in the US is made from corn. The corn used to produce ethanol could instead be used to feed cows, sheep, horses, chickens and humans. Ethanol use has forced the price of corn to record highs in 2011 of about $7.50 per bushel and continues to support this historically high price currently (2012) at about $6.50/ bushel.
The land used for growing corn cannot be used for growing cotton, row crops, wheat, raising cattle or for reforestation projects. Therefore there is an interrelationship between corn and these other land uses. Cattle, horses, sheep and humans compete with ethanol for corn. While humans eat sweet corn and animals eat field corn, the allocation of corn for ethanol affects all other food consumers.
Feeder Cattle prices are essentially at a current record high of $1.51 a pound. The prices of corn and cattle are due to a number of factors but when approximately five billion bushels of corn per year or more are used to produce ethanol, then ethanol consumption is the primary factor in the price of corn and hence food prices in general. It is estimated that 33% of the 2011 corn crop was used in ethanol production, hence the high corn prices.
The claim that ethanol produces environmental benefits is ridiculous at best. Considering that approximately 35% less energy by weight is available from ethanol compared to gasoline means that all vehicles (including farm tractors) that use gasoline need proportionally more fuel to burn and consequently create more exhaust gases.
While I am not knowledgeable as to how many acres of land, how many cubic acres of silt are washed into ocean, how many tons of fertilizer, how many acre-feet of water, or how many tons of fertilizer runoff from the land used to produce corn etc. the bottom line is that these factors are real even if they are not able to be quantified with precision. One industry source states that three gallons of ethanol is used for every gallon of ethanol produced.
The corn-ethanol situation in the US is linked to the sugar-ethanol situation in Brasil. Recent sugar crop difficulties in Brasil have caused a reversal of ethanol flow from Brasil to the US. This is one of the reasons for the current high prices of US corn. World sugar prices have gone from about $ 0.12/lb at the beginning of 2009 to about $ 0.24 currently in Feb 2012. This is a doubling of prices in 3 years. Brasilian refiners instead of producing ethanol have sold sugar on the world market. Another benefit to the sugar sellers is that the costs of ethanol production are avoided with this substitution. This means that the need for US corn will continue to be high to meet the demand of both US and Brasilian consumers.
If crop failures in the US due to weather conditions occur as has recently happened in Brasil, the current supply and price factors will only be exacerbated.
Congress appears to be responsive to the big agricultural interests with their powerful well-paid lobbyists. Until the food shortage or price situation becomes obvious to all and the public makes its voices heard, just as Congress recently refused to pass additional Internet copyright laws, nothing will change. Considering that this is an election year possibly Congress will be more sympathetic to the gasoline and food using public and not to corn special interests.
Russell Walker
7 February 2012
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Russell Walker is a Professional Engineer has long experience in the petroleum and chemical industries. He resides in Hoke County, North Carolina. He became interested in the chemistry and economics of Ethanol after he observed a local, $100 million Corn to Ethanol plant, financed, nearly entirely with public funds, that opened and closed after operating for only three months in 2011. The plant is now in private Farm Credit Bureau lender hands after going through a bankruptcy sale. USDA funds amounting to about $35 million were not repaid. Mr. Walker set out to find out why.
He can be contacted at <littlefarm1@windstream.net>
