phc june 2011
www.phcnews.com
MECHANICAL CONTRACTING
Biofuels are the main culprit for the food cost explosion. To put this ill-timed choice into perspective, the use of
biofuels had reached 6% of the global grain consumption in 2010, from early in the last decade, when it took off from a less than one percent base. It’s expected that this acceleration will reach as high as 30% of the world’s total grain crop by 2025. Oil prices are expected to increase in tandem with expanding demand, decreasing reserves and the attendant costs necessary to excavate the diminishing residue of the black gold. It isn’t only the Obama-led EPA hysteria that is causing
such a swing to biofuels. While Congress has mandated that U.S. biofuels use must reach 36 billion gallons by 2022, the European Union stipulates that 10% of transportation fuel must come from renewable energy sources by 2020. Even China, India, Indonesia and Thailand have adopted biofuel targets. Even though
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worldwide grain production has also grown impressively in the past decade, it cannot begin to keep up with the world population explosion and the vast numbers, in Southeast Asia especially, that have entered the middle class and its subsequent consumption demand. It must be remembered that the current unrest in the Mideast and North African nations emanated from Tunisian food riots earlier in the year, when government subsidies for foodstuffs were greatly reduced. Although the
mainstream media credits the subsequent revolutionary outbursts on a yearning for democracy, or alternatively on the imposition of strict Shariah law, as advocated by the Moslem Brotherhood, the threat of starvation has been the specter dangling dangerously over the Third World. Paradoxically, this is the area that has seen its population double in the last 20 years, with 90% of the population in
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Islamic North Africa and the Middle East averaging under 25 years of age. This is dolefully accompanied by a 50% or more unemployment rate, unleashing firebrand youths who have nothing to lose. In historical terms, ethanol and its ancillary gasoline
blends may prove to be the catalyst that makes food prices the breaking point in a world struggling to climb out of the Great Recession. It’s the ultimate irony that the pollution dangers of fossil fuel energy production in the U.S. will be overwhelmed by out-of-control food prices beckoning just around the corner. ;
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