for them with your taxes) add in the 20% spike in food products that
rely on field corn for food stock (Beef,pork) in the last year, apply
all at a weighted average in your life and you get the real cost of
Account for the equivalent in subsidies and tax treatment to
petroleum-based production then, too, in order for it to be a more
nearly level playing field.
As noted before, the increase in food costs is made much of and ascribed
in the popular press as owing to ethanol production but it is not so
nearly a direct correlation as that. Much is owing simply to production
costs are higher owing to (gasp, hold on now, revelation coming!) higher
petroleum costs -- fuel, fertilizer, chemical, irrigation costs are all
petroleum based and have skyrocketed if you haven't noticed. As a
simple example, it now takes almost $500 of fuel to fill the tractor
which lasts only one day during planting season. It also was a lower
yield year owing to weather through much of corn belt and wheat
production was down drastically in all the major wheat-producing regions
worldwide so stocks are down irrespective of demand.
I'm not aware of directly paid subsidies. I was in that (oil and gas)
industry for twenty years prior to joining the woodworking machinery
company. Maybe I missed them.
There are tax breaks, primarily for the production of marginal wells
and tertiary recovery, but they are not directly paid subsidies,
require profitability to be relevant (not always the case) and some
depletion allowances that, I believe, are only available to small
independent producers. The big incentives ended in 1974.
USDA Forecasts Record-Setting Corn Crop for 2007
WASHINGTON, Aug. 10, 2007 U.S. farmers are expected to produce the
largest corn crop in history in 2007, according to the Crop Production
report released today by the U.S. Department of Agricultures National
Agricultural Statistics Service (NASS). Corn production is forecast at
13.1 billion bushels, 10.6 percent above the previous record of 11.8
billion bushels set in 2004.
Based on conditions as of August 1, corn yields are expected to
average 152.8 bushels per acre, up 3.7 bushels from last year. This
would be second highest corn yield on record, behind the 160.4 bushels
per acre produced in 2004. Growers are expected to harvest 85.4
million acres of corn for grain, the most since 1933 and 14.8 million
more acres than last year.
Wonder how it came out? There was plenty of water in the corn belt.
I would suggest that you graph a few things on top of each other since
the incentive for E85. The price of refined diesel and other refined
petreleoum products. The price of a bushel of #2 corn. The
production of corn in total bushels/year. The amount of corn used for
feed stock and the amount diverted to the production of biofuel. And
then get a pie chart that shows the impact of energy costs as a
percentage of the total price of a pound of beef. See if you still
hold the same opinion
I've read a number of studies that agree with your point.
"Independent" studies by organizations like the corn growers
association. They're for the subsidies, imagine that. If I was a
corn grower, I would be too.
Not as good as those early forecasts -- there was _NOT_ plenty of water
in the corn belt in August thru September despite early wet springs.
The end of July is about when the rains stopped.
Diesel is an input, not an output. Correlation does _not_ imply causation.
The price of a bushel of #2 corn. The
Check DOE and EIA for latest work on overall energy balance. Not funded
by growers' associations.
If I were a petroleum industry maven, I'd be of your viewpoint as well.
Would you have us simply wait and rely on the oil companies to provide
all without any other efforts? That seems foolish to me (see earlier
note on the local natural gas production company advertising against
coal-fired power plant permitting applications on implication of
minimizing carbon footprint.)
IMO, a tax break indirectly is no different than a direct break. I
don't argue they should be removed from public policy for the oil
industry, I simply point out the actual cost differentials aren't as
one-side as one might like to imply and there's a lot of infrastructure
and other investment in the current petroleum distribution system that
has a lot of costs that are hidden in maintaining supplies.
We're producers, but not of corn. Wheat, milo, cattle, all dryland. So
far this year, no wheat drilled even; last decent rain was July 4th
weekend. There will be no wheat crop on much of the dryland wheat
ground next year because it's now too late even if it rained this
weekend for it to make much of a crop if it were planted now and what
little is in is in such poor condition it is unlikely to make. Last
year was a very good-looking year early but spring storms (hail,
tornados, a late freeze Easter weekend, then excessive rain through
June) destroyed a very significant fraction.
Don't know where you are but are there no varieties that can be planted
on into January? In fact, our rancher was planting varieties as late as
mid-January in recent years primarily to reduce the exposure to wintering
geese (I never thought a gaggle of geese could pack an ag field so hard).
Karnes County, Texas received more than three times it's average annual
rainfall this year, ~65 inches through the end of August. The corn was more
than a month late getting in the ground and about the same late getting
combined. It was iffy if it was even going to make it to combine, it just
did get dry enough to allow the equipment in the field.
But because of all that rain it made 84 bushels/acre vs. an average year
of 40-50 bushels/acre. And, it brought $3.30/bushel, about a dollar more
than previous years.
And now wheat is going to be a hot commodity. About six weeks ago the
price of wheat for December delivery was $9.42/bushel and that is about
double a year ago. Our lessee had to go to Comfort, Texas to lock in enough
seed which he intends to drill mid-December. Then he'll have a fight on his
hands to keep the hogs, the sandhill cranes, and the geese from helping
Until this past weekend the rains had just about quit at the end of
August. But 2.5 inches this past Saturday and Sunday came at just the right
time. I'd rather be lucky than good.
Planted, yes. Have enough warm weather, length of days and most
critically moisture to make a crop? Not likely. This is SW KS where
normal planting time for winter wheat is from September 1 through about
Most dryland corn here wasn't able to be planted until too late owing to
the early wet field conditions, then after about July 1 the hot, dry
winds pretty much killed the fill. The irrigated guys had some
reasonable yields, but nothing like were hoping for early and ended up
w/ water bills that were higher than average despite the early moisture.
Central/SE KS and OK had wet all spring until about end of June. Much
wheat was lost to the Easter weekend freeze, then much of what was left
that looked really, really good up to and into harvest time was either
hailed out, knocked down by all the rain or simply unable to get cut
owing to being too wet to thresh or even get into the field. Some guys
tried bringing in rice machines for the flotation problem but most still
couldn't thresh it or if could it was so wet it was docked heavily.
Much that was cut only tested in the mid-50s for test weights which
makes it essentially useless for anything except animal feed.
Far west had one of better yields in years -- for many in NW it was
first crop in 5-7 years owing to the continuing drought conditions
there. Here in SW, most had gotten enough to cut at least something
through all except 2 or 3 of those, but it's been really lean here as
well. Of course, you only got a good yield on what you actually had to
cut -- there was a lot that didn't make it through the winter or died
the previous fall before the rains started in the spring.
We had 1" over the July 4 weekend -- since then, only a few sprinkles
and a couple of very light showers -- 10-15 hundredths kinda' things.
Had a couple inches of dry snow last weekend after three days of 80+F
temperatures w/ dewpoints in the teens and 30 mph winds to makes sure it
took every bit of residual moisture we had first. They're talking this
next front Fri/Sat has reasonable chances but again, it'll have to
saturate the whole atmospheric column to the ground before there's a
chance for anything to actually reach the ground so by the time that
that happens the actual accumulations will again probably be pretty minimal.
As always, there are the occasional showers -- talked to fella' about 15
miles south of us down in OK -- he got one of them in September we got
the sprinkles off of, got his wheat in and up and has cattle running on
it. Said there's an area right around him about 3-5 miles wide and 8-10
long where they got that cell. Of course, they're going to have to get
some more shortly or it won't last.
If we don't get some good general rains or snow and the winds keep
blowing, going to be a dirty winter, enough to remind one of the 50s or
even the 30s if one is that old... :(
As I noted earlier, the wheat pricing is owing to world-wide demand and
low production. You've heard, I'm sure that Australia is in 100-yr
drought. KS/OK/TX panhandle was down significantly this year as well
which is large part of why seed wheat is so tight -- many of the
certified seed producers were also hit hard. Add to that the Russians
were also short as were the South Americans.
Local markets never broke $8.50 on close -- KC was near or maybe even at
the $9 mark, briefly, but we get docked pretty hard by the
transportation costs out here because there's no competition to the
single railroad. It's typically near a 50-cent "tax" for the 200-miles
to Wichita difference, even more to major terminals.
Of course, as they say -- it could be $100/bu but if you don't have any
to sell, it doesn't matter. That's going to be next year for us, it
appears unless miracles happen. We'll probably just keep holding some
reserve from this year and "hide and watch" to see what happens.
I don't believe August is early for field corn. However, USDA
November report is slightly better than the August forecast. Reckon
that corn is in yet?
Didn't say that, just pretty much don't believe in government
involvement. And I don't believe that ethanol is the answer. System
80 would have been a good start, but it was killed by the left wing
wacko's in the early 70's.
Well, "believing in" isn't the same thing as being realistic. The
government _is_ involved and they're involved in a big way and will
continue to be. They're just as involved in oil and agriculture as
anywhere else, it's just a little more convoluted as it's been longer in
the making than ethanol itself. Last I checked all the major oil
producers are significant contributors to both the "ins" and the "outs"
in the political process, maintain significant lobbying staffs and run
tremendously expensive ad campaigns to convince the public of the wisdom
of their particular choices for tax and energy policies. Right, wrong,
indifferent, it's simply the way things work.
Didn't figure you would want to. Can you say Middle East oil has many
ancillary costs that aren't on the books of the majors? And that's only
the _most_ obvious.
And, if you'll recall, I've repeatedly agreed I don't think biofuels in
general (and ethanol in particular) are "the" answer, either. I do
think there's a role in a transition that is useful, however.
Given the political realities, doesn't appear as though there's
sufficient political will to yet allow for new exploration in many of
the currently off-limit places and even if that were to change now, it
wouldn't have an effect on production for quite some time. It also
doesn't do anything to improve/increase the refining capacity which,
while it has grown owing to expansion efforts, is still a bottleneck.
Meanwhile, if it can coincidentally pump some life into the farm
economies of the central plains, that can only be, imo, _a_good_thing_ (tm).
If you're referral is to the CE "standard design" they named that, then
yes, there's (yet another) place we went far wrong way back when, along
with Jimmy pulling the plug on the CRBRP and stopping NRC licensing
review for the proposed GE-built/financed commercial fuel reprocessing
facility at Barnwell.
It _is_, otoh, heartening to note that TVA/NuStart have actually filed a
formal licensing application for a new unit at the Bellefonte site in N
AL (about three weeks ago, now). Of course, it's more than a little
disheartening that the Bellefonte I unit sits there over 90% complete,
abandoned in situ since the late 80s/early 90s along w/ the roughly 850
MWe that Rancho Seco could have been producing in CA if not for the
ill-considered plebiscite orchestrated by the same groups.
Coincidentally to your energy-related background, in a former life I was
NE for B&W NPGD Lynchburg. I came back to farm after 30-something years
mostly generation-related engineering last 10 or so mostly for the
fossil utilities at the EPRI I&C Center located at Kingston Fossil.
Oh, you have no problem convincing me of the advantages of nuclear as
the rational long-term choice for baseload electricity generation; it
unfortunately doesn't really directly address the issue of liquid fuels
under discussion here.
While more nuclear generation would, if were to replace current gas and
oil-fired units, alleviate a small portion of current demand and
undoubtedly make a (very short term) dent in the current price pressure
if it could happen in a short time but, of course, it can't so we're
still in the position of "what do we do now that can actually get done?"
Who we always considered (their nuc generation division, of course) a
quality and fair competitor... :)
Sadly neither are still in the nuclear island marketplace leaving the
field in the US to GE and circle-W. :(
Since you know this to be true, a compairison was made between a Prius and a
Hummer. The compairison included the energy used to manufacture every
component of both vehicles, the energy used to maintain and operate the
vehicles through their expected life spans, and the energy used to recycle
the components of the two vehicles when the vehicles were considered worn
out. Because the Hummer out lived the Prius by a margin of over 2 to 1 the
Prius had the disadvantage of the energy spent on building, maintaining, and
disposal being increased by the same margin.
The Hummer ended up being the most ecological and effecient vehicle to
produce, operate, and dispose of.
www.Zapworld.com This company has been producing electric vehicles for more
than 10 years in California and has a great looking vehicle yet to come out
called the Zap X.
A very interesting vehicle.
Also Honda is selling a Hydrogen fuel cell car in California now.
The only problem with that is the recharge time. Currently, battery
technology doesn't allow for enough use between charges, nor a fast
enough charge time. Having to charge your battery for 8 horus for
every 4-5 hours of use will never work and the things are so
ridiculously heavy that exchanging them at a station is unworkable.
I agree that it's just not reached an efficiency that's worthwhile yet
but it's a growing technology and one that's feasibly renewable.
Take a look at www.zapworld.com They are claiming that the technology is
here now. Crusing range of 350 miles, 1 cent per mile energy cost, recharge
time in as little as 10 minutes, and loads of hp.
IIRC DeWalt is getting similar results from their latest batteries.
Unfortunately I can see the oil companies buying this company out and
shutting the whole thing down.
ZAP is well known as a company which is 95% hype, 5% substance. The
actual products they are selling are generic Chinese electric scooters
and low speed three wheel electric vehicles which are little more than
golf carts. Why three wheels you might ask? Well, so that for safety
regulation purposes they are considered motor cycles.
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