Category: Biofuels

EconTalk Podcast on Organic Farming

Last month, Russ Roberts interviewed organic farmer Lisa Turner for EconTalk. Mrs. Turner is a civil engineer, and she and her husband are the owners of Laughing Stock Farm in Maine. Laughing Stock Farm sells to restaurants as well as to individuals through a community-supported agriculture (CSA) scheme and at farmers markets.

The conversation covers everything from the socialist aspects of CSAs to capitalism, and from a typical day in the life of Mrs. Turner to the federal government’s grab of the organic label in the early 2000s.

I have learned a lot while listening to it, and a lot of this might eventually inform my lecture on local and organic agriculture in my food policy seminar.

You can download or stream the hour-long podcast by clicking here.

HT: Jayson Lusk.

Biofuels and Food Security in Guatemala

Recent laws in the United States and Europe that mandate the increasing use of biofuel in cars have had far-flung ripple effects, economists say, as land once devoted to growing food for humans is now sometimes more profitably used for churning out vehicle fuel.

In a globalized world, the expansion of the biofuels industry has contributed to spikes in food prices and a shortage of land for food-based agriculture in poor corners of Asia, Africa and Latin America because the raw material is grown wherever it is cheapest.

Nowhere, perhaps, is that squeeze more obvious than in Guatemala, which is “getting hit from both sides of the Atlantic,” in its fields and at its markets, said Timothy Wise, a Tufts University development expert who is studying the problem globally with Actionaid, a policy group based in Washington that focuses on poverty. Continue reading

Food Prices, Meat Consumption, and Paternalism

I took part it a Triangle Institute for Security Studies event at NC State last week on the theme of “Energy and Security,” where I briefly discussed my work on food prices and social unrest.

At the end of my talk, I mentioned a few policy options that global policy makers could pursue if they want to keep food prices down: Continue reading

What Can We Do About Food Price Volatility?

A new article by Brian Wright, of UC Berkeley, in the World Bank Research Observer:

In the long view, recent volatility of prices of the major grains is not anomalous. Wheat, rice, and maize are highly substitutable in the global market for calories, and when aggregate stocks decline to minimal feasible levels, prices become highly sensitive to small shocks, consistent with the economics of storage behavior. In this decade, stocks declined due to high global income growth and biofuels mandates, making markets unusually sensitive to subsequent unanticipated shocks, including biofuels demand boosts in reaction to high petroleum prices, the Australian drought, and other regional grain production problems. To protect their own vulnerable and politically influential consumers, key exporters restricted supplies in 2007, exacerbating the price rise. Understandably, vulnerable importers are now building strategic reserves. To reduce costs and disincentive effects, reserves should have quantitative goals related to targeted distribution to the most vulnerable in severe emergencies. For countries with significant animal feeding or biofuels industries, options contracts to protect the consumption of the most vulnerable from harvest shocks are likely to be more cost-effective than emergency reserves.

 

Ethanol and High Food Prices

It is not often that a stroke of a pen can quickly undo the ravages of nature, but federal regulators now have an opportunity to do just that. Americans’ food budgets will be hit hard by the ongoing Midwestern drought, the worst since 1956. Food bills will rise and many farmers will go bust.

An act of God, right? Well, the drought itself may be, but a human remedy for some of the fallout is at hand — if only the federal authorities would act. By suspending renewable-fuel standards that were unwise from the start, the Environmental Protection Agency could divert vast amounts of corn from inefficient ethanol production back into the food chain, where market forces and common sense dictate it should go.

From an excellent New York Times op-ed by Colin Carter, from the Department of Agricultural and Resource Economics at the UC Davis, and Henry Miller, a senior fellow at Stanford’s Hoover Institution.

Here is a telling series of numbers from the same op-ed: Continue reading