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Wall Street Journal Editorial: In Light of Food Inflation, Ethanol Policy Could Soon Become 'Immoral'

Monday, January 24, 2011

(American Meat Institute)

“The global economy is getting back on its feet, but so too is an old enemy: food inflation. ... So why is the United States, one of the world's biggest agricultural exporters, devoting more and more of its corn crop to . . . ethanol?” asks a recent Wall Street Journal editorial.

The editorial noted that Department of Agriculture data shows a remarkable trend over a decade: in 2001, only 7 percent of U.S. corn went for ethanol, or about 707 million bushels. By 2010, the ethanol share was 39.4 percent, or nearly five billion bushels out of total U.S. production of 12.45 billion bushels. Four of every 10 rows of corn now go to produce fuel for American cars or trucks, not food or feed.

“About 40 percent of U.S. corn production is used to produce feed for animals. As corn prices rise, beef, poultry and other prices rise, too. The price squeeze has already contributed to the bankruptcy of companies like Texas-based Pilgrim's Pride Corp. and Delaware-based poultry maker Townsends Inc. over the past few years,” the editorial stated.

The editorial noted that this damage coincides with a growing consensus that ethanol achieves none of its alleged policy goals.

“The Environmental Protection Agency has found that ethanol production has a minimal to negative impact on the environment,” the editorial stated. “Even Al Gore, once an ethanol evangelist, now says his support had more to do with Presidential politics in Iowa and admits the fuel provides little or no environmental gain. Not that this has changed the politics of ethanol.”

“At a time when the world will need more corn and grains, it makes no sense to devote scarce farmland to make a fuel that exists only because of taxpayer subsidies and mandates. If food supplies tighten and prices keep rising, such a policy will soon become immoral,” the editorial concluded.

To view the editorial in its entirety, click here: http://www.meatinstitute.org/ht/a/GetDocumentAction/i/65947


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