Leaked food price report pushes ethanol debate

The University has done controversial studies on ethanol in the past, but a World Bank report leaked in early July pressed the debate even further.

The report, leaked to "The Guardian," a British newspaper , said that production of biofuels , such as corn ethanol, have forced global food prices up 75 percent. The United States is the world's top corn exporter , and Minnesota was the nation's fourth-highest corn producer in 2007. More here...

High Oil Prices? Blame Ethanol, OPEC Says

Ethanol is on the ropes because of the food versus fuel debate, but now a new heavyweight just stepped into the ring and this one has got some really big guns.

OPEC president Chakib Khelil has a new culprit for the rising cost of oil–ethanol. Mr. Khelil says about 40% of the recent rise in oil prices can be chalked up to ethanol, which accounts for about 1% of the world’s transportation fuel. The other 60%, apparently, is due to a weak dollar and “geopolitical worries.” The problem: OPEC’s boss doesn’t lay out the logic explaining why ethanol blended into gasoline is to blame for high oil prices. More from the WSJ...

OECD report says massive biofuel subsidies not helping to cut greenhouse gases

BRUSSELS, Belgium: Massive government subsidies for biofuels are not helping to reduce greenhouse gas emissions, according to an OECD report released Wednesday.

The U.S., EU and Canada spent €11 billion (US$17.6 billion) in public money to support energy crops in 2006 — and will more than double that over the next 10 years, according to estimates by the Paris-based Organization for Economic Cooperation and Development. More here...

Wholesale prices soar in June; Sales are sluggish

WASHINGTON (AP) -- The economy showed the depth of its twin problems on Tuesday, slow growth and rising inflation, as the nation wrestled with a teetering financial system, a slumping dollar and rising prices for food and fuel.

The Labor Department reported that soaring costs for gasoline and food pushed inflation at the wholesale level up by a bigger-than-expected 1.8 percent in June, leaving inflation rising over the past year at the fastest pace in more than a quarter-century. More here...

Food prices will continue to rise around the globe

In 1928, Republicans famously promised “a chicken in every pot.” These days, it’s becoming increasingly difficult to promise even an apple for every schoolchild.

And the growing number of poor people around the world will just have to wait in line. More here...

USDA Rule Change May Lead To Crops on Conserved Land

Under pressure from farmers, livestock producers and soaring food prices, the U.S. Department of Agriculture is weighing a policy change that could lead to the plowing of millions of acres of land that had been set aside for conservation.

At issue is the Conservation Reserve Program (CRP), under which the government has paid farmers to stop growing row crops, such as corn and soybeans, on 34 million acres across the country. Designed in the mid-1980s to hold down production and bolster commodity prices, the $1.8 billion-a-year program has turned into a major boon for conservation, with much of the acreage planted with perennial grasses or trees, or restored to wetlands. More here...

Let’s stop subsidising the production and use of bio-fuels

Editorial by Willem Buiter for Financial Times. A recent World Bank report on the causes of the rise in food prices during the past three years confirms the view, widely held outside the Washington DC White House and the French farmers’ lobby, that increased bio-fuel production has made a major contribution to rising food prices. According to Rising Food Prices: Policy Options and World Bank Response, global wheat prices rose by 181 percent over the 3-year period leading up to February 2008 and overall global food prices by 83 percent. Food crop prices are expected to remain high in 2008 and 2009 and then begin to decline. They are likely to remain well above the 2004 levels through 2015 for most food crops. Around 15 percent of the increase in food crop production prices is due directly to higher energy and fertilizer costs.