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Sharp Decline Forecast for World Cereal Stocks; Ethanol Demand a Contributor

19 July 2006

Fao_1
Global cereal production and consumption. Click to enlarge.

World cereal end-of-season stocks are expected to decline 10% in 2006, due to a slight 1% decrease in global cereal output and growth in utilization, according to the latest forecast of the UN Food and Agriculture Organization (FAO).

Increased demand is expected to be driven by a recovery in feed use due to a rebound in poultry consumption. In addition, the growing demand for ethanol is likely to boost industrial use of coarse grains, particularly maize, especially in the United States and in China.

Course grain production is expected to drop 1.3% while utilization increases 2.8%. Coarse grain stocks are projected to decrease 20.3%.

While down about 1% from 2005 levels, world cereal production for 2006, forecast at 2,020 million tonnes, would still be the third highest on record and above the five-year average, the report said.

International prices of most cereals remained firm or rose further in recent months, supported by strong demand and tighter supply prospects, FAO said in its latest Crop Prospects and Food Situation report.

Many countries are experiencing severe food difficulties and require external assistance, however, despite what the report called a ”generally satisfactory global food outlook.”

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July 19, 2006 in Ethanol | Permalink | Comments (31) | TrackBack (0)

Comments

NBK:
You vulgarize some (not all) of my points and then fight them on trivial level.
I am not “mathematically inclined”. I have Master degree in mathematics. And I long ago passed point where reading of popular books somehow could benefit my knowledge. I am not against statistical analysis and sensible implementation of it. I am pointing out that there are some examples when applying of statistically correct findings to individual cases is not correct. Currently California insurance companies are fighting government legislation to set car insurance premiums according to driver’s record, experience, and miles traveled. They want to continue their old practice, when these premiums are calculated according to driver’s postal code alone. They pointing out that it is statistically sound. To my opinion regulation of human diet, which is highly individual, according to statistical trends of population as a whole is incorrect too. You can argue this particular point, but please do not imply that I am against statistical analysis and its implementation as a whole.

Same with government regulation and especially regulation by taxes/fines. I am not against it, because it is necessary and it works. But it has it limitations, doesn’t it? The only thing I am saying that government should not employ preferential food taxation/pricing to encourage us to it “healthy food”. Again, you can argue this point, but please do not explain me how speeding tickets are working.

As you rightfully pointed out, climate change issue is very complicated. No one could exclude possibility that human activity could tip the natural balance. But on current level of scientific knowledge, it is not even nearly proved that this balance is tipped or will be tipped in near future. More research is needed to clarify the mechanics of climate change, and to develop effective, reversible, and economically non-destructive strategy of climate control (if needed). What I am seeing is over simplified, bullish, self-benefiting for Climate Change lobby attempts to rush on the society economically and socially damaging practices of questionable efficiency. Also very alarming is trend of Climate Change lobby to humiliate critics of their approach in scientific community to oblivion, playing lowest possible human emotions (like hatred to America, hatred to rich, hatred to society because of their own low social status, national supremacy complexes, end-of-the world hysteria) alienating with marginal extremist movements like tree-huggers, neo-communists, anti-globalists, and currently even with islamo-terrorist supporters to bash anyone who does not want to pay immediate extortion tax to the Lobby. Anyone raising doubts about some specific point of their strategy is immediately labeled as villain trying to destroy the Earth on payroll of Exxon-Mobil.

And the last. Your analogy of finely balanced see saw is good example of oversimplified, incorrect, yet impressive to uneducated auditory way to describe the problem of climate change. I do not believe that you do not understand this, no matter what you would say. For other (hopefully) readers of this discussion: balanced see saw represents UNSTABLE equilibrium, where it is correct to claim that relatively small impact could totally tip the equilibrium. However, complex systems, as any natural system is, have STABLE equilibrium, where system fight back any impactr contributing to equilibrium change. The question is while human activity could tip global climate system beyond its ability to maintain equilibrium. And the first factor in assessing this problem is to know what is relative input of human activity into natural process. If it is 50%, the danger to wreck system out of control is big. If it is 2-3%, as it is in reality, PROBABILITY of such catastrophic impact diminishes exponentially. Again, Climate Change lobby is shy to explain this fact to general public for quite understandable reasons.

Looking forward to further productive discussion on incoming topics, NBK

Posted by: Andrey | July 21, 2006 at 03:39 PM


Two Lies a Truth Don't Make.

Ethanol is not a renewable substitute for oil, not even close to be a solution. Ethanol is grown with huge amounts of energy + fertilizers + pesticides all made from ... what else ? oil + natural gas by 'farmers' who don't give a hoot about the land, you, me, themselves or the planet, devastate the watershed, polute air, water, soil, food, poison children, men, women alike with vast amounts of carcinogens and mutagens, are sold slaves of the genetically modified and pesticide corporations, use fertilizer, chemicals, herbicides, pesticides, diesel transportation, diesel tractors, and guess where all that comes from ? oil...yes ?
If in doubt, read the published research papers in peer reviewed scientific journals by Prof. Patzek, UC Berkeley, and Prof. Pimentel, Cornell U. The energy balance of ethanol is at least negative 6:1, ie, pay for six gallons of gas, drive one, could be worse, plus all the above, not the positive 1:1.2 or 1:1.3 without any consequences claimed by the 'industry' peddlers.

Have a great day.

Posted by: no more wars | July 22, 2006 at 05:17 PM

No more wars:

Relax, man. Have a good meal, couple of drinks, and start smiling. It will be OK.

Posted by: Andrey | July 23, 2006 at 03:38 AM

no more wars -

I suggest that you actually *read* the article by Pimentel and Patzek. It contains a few questionable assumptions.

zianet.com/ehusman/weblog/2005/07/actually-reading-article-better-than.html

Posted by: Eric H | July 23, 2006 at 11:54 AM

In conclusion: earth is overpopulated, stop the humans.

Posted by: Bajoras | August 03, 2006 at 05:07 PM

Andrey:
I agree with yr last point of stable vs unstable equilibrium. The natural system is exceedingly complex and does try to "fight the changes contributing to climate change", in the form of hurricanes, lightning thunderstorms, melting glaciers, breaking ice shelves, thawing permafrost, droughts, heatwaves, coldwaves, El Nino, 1 degree C increase per century, highest co2 reading in 10,000 years, earthquakes, eruptions, hailstones, fire & brimstone, and whatnot. I agree wholeheartedly ;-)

Posted by: Fishlipps | August 08, 2006 at 10:31 AM

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