The Price of Wheat

For those of you looking for the real costs of unsustainable consumption, look no further than your local grocery store where the demand for new fuel sources has increased the price of wheat-based products almost 3-fold in only one week! Don't understand how the two are linked? The folks at ABC.com do a pretty good job of putting things in plain enough terms...

"Just a few weeks ago, 50-pound bags of flour cost about $15. Today, they're $40."

"Blame it on the price of wheat. Demand for alternative energy has farmers planting less wheat and more corn, the key ingredient of ethanol. According to the USDA, since 1997, the amount of farmland dedicated to planting wheat has dropped from 70.4 million acres to 60.4 million, while corn acreage has risen from 79.5 million to 99.6 million."

Click here to read the rest of the ABC.com story.

This startling connection was actually described by the Earth Policy Institute's Lester Brown as early as 2003. The predicament is particularly well described in the newest edition of Brown's Plan B 3.0 (go here to read the entire Preface).

"From an agricultural vantage point, the world’s appetite for crop-based fuels is insatiable. The grain required to fill an SUV’s 25-gallon tank with ethanol just once will feed one person for a whole year. If the entire U.S. grain harvest were to be converted to ethanol, it would satisfy at most 18 percent of U.S. automotive fuel needs.

"Historically the food and energy economies were separate. But with so many ethanol distilleries now being built to convert grain into fuel, the two are merging. In this new situation the world price of grain is moving up toward its oil-equivalent value. If the fuel value of grain exceeds its food value, the market will simply move the commodity into the energy economy. If the price of oil jumps to $100 a barrel, the price of grain will follow it upward. If oil goes to $120, grain will follow. The price of grain is now keyed to the price of oil.

"The emerging competition between the owners of the world’s 860 million automobiles and the 2 billion poorest people is uncharted territory for humanity. Suddenly the world is facing a moral and political issue that has no precedent: Should we use grain to fuel cars or to feed people? The average income of the world’s automobile owners is roughly $30,000 a year; the 2 billion poorest people earn on average less than $3,000 a year. The market says, Let’s fuel the cars" (pp. 40-41).

It's all coming true, only sooner than anyone would have guessed -- well, almost anyone. I think it's time for us Barack supporters to tell Obama he needs to rethink his stance on biofuels.

UPDATE

Newsweek: Ethanol boom threatens West's water