Ethanol no longer seen as big driver of food price - Guardian UK

http://open.salon.com/content.php?cid=37481

The Guardian UK has an interesting article on ethanol and food prices in light of recent declines in corn prices.

Heavy demand for corn from ethanol makers was seen as a key driver of corn futures to record highs in June, but since then the sharp decline of corn along with other commodities shows that belief was mistaken.

Instead they say that commodity prices were pushed up primarily by speculation.
Analysts said soaring corn prices were a symptom of big shifts of investment money into corn and other commodities. As big money began shifting out of stocks a few years ago, commodity markets like corn futures began climbing. "There was a speculative bubble in the market and that's one of the bigget things that came out of the market is just that equity markets weren't good and for a while the money came into commodities," Ramsay said.

Given the fact that corn prices are falling even while ethanol production is continuing to increase, all the signs suggest that ethanol wasn't the main driver for the high prices seen during the summer. The Guardian article is the first that I have seen that points this out.

Source : Guardian UK
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The Guardian was one of the loudest proclaimers of the theory that biofuels were driving up food prices last year._JW

are driven not by fundamentals -- what the man in the street would call "supply and demand," but by greedy ratbastards (by which I mean my fellow human beings) gaming the system.

Maybe it's the system that's the villain here.

interest rates are near zero

companies are going bust left and right

worldwide, there is 50 trillion USD looking for something to do,
which is about one year of global finantial output

widows, pension funds, orphans, etc
sought out commodities,

the bubble eventually burst

more complete discussion. You may have been asleep the last several months but Credit Default Swaps have been recognized by all those not in a coma, as central to the credit catastrophe. OF course, Republicans (NOT that YOU are one of them) will have some other way of explaining it (of obfuscating the issue), but that's to be expected - it was their philosophy (or I should say their lobbyist controllers philosophy) that brought about this disaster.

But people seemed to want to buy into the hysteria.
It was hedge funds....investors ...what the fuck ever.
Ending stocks are higher than they have been for a few years and ethanol production has increased.
Still something like 50 million acres laying in reserve.....about 22 million to come out in the next 5 or so years.
I just shook my head at the panic that people were spewing...
Beside....I believe the hysteria started from an article published in the Washington Times....put out by a think tank funded by the grocers association. Checked your grocery bill lately???

biofuel haters can STFU

:D