Cost of producing ethanol raises serious questions

Tuesday, June 6, 2006

By Jack H. Knowlan Sr.

Recent articles promoting ethanol make it sound like a good investment, good for the corn growers and good for consumers by reducing the need for gasoline.

Although in Brazil ethanol is produced from treetops and brush, in the U.S. it is only produced from corn. Two of the main expenses in growing corn are nitrogen fertilizer and diesel or gasoline for fuel.

Nitrogen is produced from natural gas, and right now there is a critical shortage of natural gas. Ask anyone who heats with it, and he will tell you his gas bill has practically doubled this past winter.

Likewise, ask any farmer and he will tell you that anhydrous ammonia and other forms of nitrogen fertilizer have virtually doubled in cost.

This has caused many farmers to seriously consider planting less corn, which should greatly increase the price of corn. I am guessing it will go up to $3.50 to $4 a bushel. The corn farmers will need a price like this to pay for the extra cost of nitrogen and fuel.

If this sounds like a vicious circle, it is one. If the corn farmers come out all right with the high corn prices, look what it does for the cattlemen and the pork producers.

Corn is the principal ingredient in practically all beef, pork and poultry feed, and feeders (feed lots or farm fed) who cannot control selling prices will either go broke or cut production. In either case it will end up increasing the consumer price of meat.

The farmer who feeds his own corn to hogs, cattle or poultry will certainly be no better off.

The last I heard, the federal government was giving tax breaks and offering subsidies to promote ethanol production. Although we may not recognize it, this too is coming out of the consumer's pocket. So it seems like we are robbing Peter to pay Paul.

Do we really want to use up our natural gas, causing it and food prices to go sky high just to produce ethanol that can only be used by mixing it with gasoline and which, without tax breaks, would probably cost more than fossil fuels?

Looking to the future, what are we going to do with all those ethanol plants when natural gas gets so short it can no longer be used to make nitrogen to grow corn?

Jack H. Knowlan Sr. is a Jackson resident.

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