307 comments on DrumBeat: November 2, 2006
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307 comments on DrumBeat: November 2, 2006
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Farmers in Colombia could make money with Normal crops so they raised Coca Leaf.
Maybe the Midwest farmers who can't make money raising corn could raise Hemp?
But if they did, How would the CIA increase it's slush fund income like they do controlling the other two examples??
The demand for the 'fiber' part was destroyed by the (many times better) fiber-from-oil market.
For the farmers to start winning again, they'd have to produce products which, when their labor is added, exceed the value of old stored sunlight. Good luck on a solution everyone will find as likeable as the 50 year+ model of oil-> food and oil-> fibers. Good luck on finding a solution that is just as good per acre for the small 40 acre operators as it is for the 400, 4,000 or 40,000 acre operation.
A current example is organic crops. Years ago organic growers were the odd balls of agriculture with a limited market - but they made money. However, as the market has grown, the initiators are being forced out as large-scale organic operations are taking over the organic market. In essence, organic crops are becoming a commodity, not a specialty.
Years ago I was a small-scale, certified organic grower. We had the local market to ourselves. However, we reached a point where we had to either spend a lot of money (mostly for additional greenhouse space) to expand our production or quit. Expansion was necessary to make more than day wages by selling in other towns. As we looked at the capital cost, the cost of hiring people and the transportation cost to additional towns, we said the risk/reward ratio wasn't worth it. We shut down.
Sure, there are still niche markets out there such as producing native plant seed but this won't help production agriculture. There is no good answer.
Todd; a Realist
Biofuels changes the game. Demand for gas for the car could swallow everything farmers could grow. Of course, with the ensuing mass starvation, demand might be lessened. Perhaps you're right after all.
It's unclear what your point is; even corn for ethanol is finite. I get the impression that you don't understand production ag. What will happen, just like llamas and wine grapes, is that farmers will switch out of a corn and beans rotation to corn on corn and create a glut of corn. This will drive the price of corn down and beans up so...
At the same time, by switching to corn on corn, their cost of production will go up since they won't have the residual nitrogen from the beans, possibly have to irrigate more, be paying for GM seed and their profits will likely go down short of an explosive increase in their corn price. This is why so many farm wives work off the farm (and do the farm's books in their spare time) - to balance the variability of income and, maybe, get some benefits like medical. You got to ask yourself, if farming is so great a profit center why does the farmer's wife work as the elementary school secretary?
But, I was addressing profitable farming in my initial response. Growing commodity crops is like being a slave to the bank because it is often impossible to plow down and plant crops without a loan each year.
Is overseas demand going to make a difference to farm profitibility? How are these countries with starving people going to pay for it? Via our tax dollars to subsidize it all? Are US consumers going to watch the price of food go up because the .gov mandates ethanol? How about the reality that new engines aren't tricked into better emissions because of the oxygenates added to gasoline?
In my county, I know of quality wine grape growers who didn't pick last year because they couldn't find a home for their grapes that turned a profit. The same thing will happen to corn growers.
I don't know the answer.
Todd; a Realist
My point is this:
Corn and soybeans are currently commodities because there has been an overproduction relative to world demand. Subsidies paid to farmers for these make things worse for everybody except ADM and Cargill. Farmers get hosed because they take all the risk and are usually in debt for equipment, land, etc. I'm not an ag expert, but my dad grew up on one and I have plenty of close relatives in Illinois that farm including a cousin that does pretty well. But most do work other jobs. That is the present, though. I'm talking about the next few years, and farmers are excited about a huge new market for their produc. Who can blame them?
There is currently under construction in western Washington a biodiesel plant capable of churning out 100 M gallons of product per year. Similar things are unfolding in Iowa and elsewhere. I added a few of them up and came to 1.2 billion gallon capacity in the next couple of years. Assuming they all use soybeans, that would use a third of the current US crop. But even that much biodiesel doesn't make much of a dent in the amount of diesel fuel consumed in the US. Same for ethanol, assuming that the EROEI really is 1.2 or so. Energy consumption is like a black hole--it will swallow everything and not so much burp.
I'm not saying things will turn out good for farmers, as it rarely does.
I guess we are coming from the same place in most ways - at least we aren't arguing about basics.
I believe that farmers are going to take it by over producing. You may be right that they have a few good years ahead. I just believe that farm profits, in the long run, won't come from producing commodtity crops regardless of their demand.
My rationale for this is that consumers are going to whoop and howler about farm "subsidies" just like oil profits if it hits them in the pocketbook. We'll see.
Todd; a Realist
However, offsetting 10% of gasoline use with a sustainable, climate friendly fuel such as sugar cane derived ethanol is exactly the type of step we need to take to completely solve peak oil and global warming. 3-4 more silver bul;ets of the same magnitude and peak oil would be a lot less of a worry.
Hmmm. Nylon makes good casings for bicycle tires. I remember tyres of silk, cotton, and linen, Nylon just as good, or better.
OTOH I have a new silk scarf. Handloomed, wild-gathered silk, vegetable dyes, that sort of thing. Not only do I get looks and compliments, total strangers walk up and want to touch it. You won't get that from oily products.
I think you'd be surprised.
Today's polyester is nothing like the kind that was infamous in the '70s. You'd never know it was polyester.
And I'm going to miss microfiber if it gets too expensive for ordinary peons. It's much better than cotton for athletic wear, because it wicks moisture away from the skin. And I love microfiber dusting cloths.
Then there's nylon stockings...
And the raptors and coyotes would love it too. Need to develop some new products though like Kentucky fried rabbit and maybe buffalo ears.
Seriously though Iowa and the corn belt have seasonal rains and fertile soils. Their production potential for summer vegetable production and for decentralized grain/meat as crop has been displaced by longer seasons in
California, industrialization of meat production, cheap energy and transportation.
My take on this situation is that it is a temporary situation and that energy futures will neutralize this subsidy driven corn/ethanol market for grain.
Best
offer them twice as much to use that land for food rather then making fuel.