Record corn prices and ethanol

[lukeh]

I see with the drought that corn is at record prices. I've also spoken with several farmers in my area and they are saying their crop is a total loss and they'll be needing to purchase feed for their animals.

So will ethanol prices jump at the pump? What will these ethanol plants do when the corn crop for entire areas are wiped out? I know this is a loaded question but what does this say when you use our food for fuel and will this cause any repercussions going forward.

[legion]

I suspect the federal subsidies will increased on ethanol to further hide how expensive it really is....

[jyl]

Not just corn but also soybean futures are at record levels, possibly other crops too, due to the most extreme drought and heat since at least the 1950s. This situation as been getting worse over the past couple of months. A few months ago, farmers and the market were expecting a big crop because so much was planted; now it looks like a very, very poor crop.

This will increase food costs in the supply chain and food prices at the grocery store. How much, depends on how weather and crops behave in other growing regions of the world - if they can make up for the decline in the US crop. So look for weather disruptions elsewhere.

Ranchers are cutting their herds since there isn't enough pasture and feed/hay prices are high. This will cause a temporary increase in beef supply, as those head move through feedlots and go to slaughter, but then we will see higher beef prices - not sure when, end 2012/early 2013 maybe?

As for ethanol - the price is already jumping. I don't know if this link will work but anyway you can search for ethanol futures.
http://www.cmegroup.com/popup/mdq2.html?code=ZHX2&title=November_2012_Ethanol&type=p#link=monthly

[lukeh]

Who decides where the corn goes...the open market? Can a farmer just sell the corn to whoever is paying most?

Let's say the crop is real bad and we need the corn for food products and feed...can any organization just jump in an say all corn needs to go to food based products? And if that is the case what would happen to the states that have mandatory ethanol in their gas?

[lane912]

whoever went short on this one should be buying a round for the pelicans-

[porwolf]

It is about time to scrap the ethanol fuel program. It was originally a nice idea: Grow fuel material instead of refining it from fossile oils. But it turned out to require, gallon for gallon, as much or more fossile originated fuel to get it to the pumps in the US. In other words a net loss!

[lane912]

*just found out that the service station down the street from the house I bought has premium without ethanol!!!!!!
god my cars run better with just gas in the tank-

[mossguy]

How do you know that it doesn't contain ethanol? Seriously.

[gtc]

it tastes different

[on2wheels52]

I've heard talk of $10/bushel corn and $20/bushel soybeans by the end of the year. Time will tell.
Jim

[intakexhaust]

E85 production is slammed down and some plants have already shuttered. High cost of corn makes it even further unprofitable.

[lane912]

Originally Posted by mossguy

How do you know that it doesn't contain ethanol? Seriously.

pump is labeled-
will take photo next time i am there--

[Brando]

This may be the needed incentive for refiners to switch away from terribad gasahol and find a better agent.

[sammyg2]

Originally Posted by Brando

This may be the needed incentive for refiners to switch away from terribad gasahol and find a better agent.

The refiners hate ethanol more than the rest of us but gubmint regulations and subsidies make it a necessary evil.

Doesn't matter how stupid or expensive or inefficient it is to turn food into ethanol, as long as it makes lefty feel good it's ok.

[GH85Carrera]

Originally Posted by mossguy

How do you know that it doesn't contain ethanol? Seriously.

The LAW in Oklahoma is that the pump be labeled. The gas station I shop at has a huge banner that proclaims their station is ethanol free, as does the competition across the street. One mile away I can fill up with Gas-ahol for 10 cents per gallon less. I will not be using that option.

[enzo1]

[widebody911]

Originally Posted by sammyg2

Doesn't matter how stupid or expensive or inefficient it is to turn food into ethanol, as long as it makes lefty feel good it's ok.

It's not the lefties, it's agribusiness.

[EarlyPorsche]

Originally Posted by sammyg2

The refiners hate ethanol more than the rest of us but gubmint regulations and subsidies make it a necessary evil.

Doesn't matter how stupid or expensive or inefficient it is to turn food into ethanol, as long as it makes lefty feel good it's ok.

To be clear, and not to make it political but to address the issue, under what President was ethanol added to fuel?

[Brando]

Almost makes it worth-while to venture out-of-state, fill up large containers and store it (since real gas doesn't break down as fast as gasahol) for use in our cars. With real gas you get prolonged life of your fuel-system and better Fuel Economy.

[dmcummins]

I wish there was more places to get ethanol free gas around here. I can run ethanol free gas in my plane. But not gas with ethanol. It would save me a lot.