Will a drought affect the price of ethanol?

Food or Fuel
An Iowa farmer shows off his corn seeds as increases in ethanol demand lead farmers to grow corn for ethanol production.
An Iowa farmer shows off his corn seeds as increases in ethanol demand lead farmers to grow corn for ethanol production.
Mark Hirsch/­Getty Images


We're still a long way from making cars that can use household garbage for fuel. However, there may be waste products that allow for ethanol production without compromising corn use in food someday.

Scientists at the leading edge of ethanol research are investigating ways to make the fuel from biomass, organic by-products that might normally be considered useless.

This so-called cellulosic ethanol can be made from wheat and rice straw, switchgrass, paper pulp, and agricultural waste products such as corn cobs, citrus, algae and corn stover. (Stover is the name for leaves and stalks left over after corn is harvested.)

Environmentalists knock ethanol because they say it puts a misplaced emphasis on growing corn for fuel rather than food. They also say it does little to curb harmful atmospheric emissions, since fossil fuels must be burned to process ethanol.

But cellulosic ethanol, if fully developed, could alleviate those concerns. Proponents of cellulosic ethanol say it holds twice the energy potential of corn-based or sugar-based ethanol. That means less land would have to be devoted to harvesting crops for fuel. Furthermore, making and using cellulosic ethanol creates far fewer greenhouse gas emissions than corn-based ethanol. Whereas standard ethanol reduces harmful emissions by 20 to 30 percent compared to gasoline, cellulose-based ethanol cuts emissions by 80 percent [source: Energy Information Administration]. By 2008, a handful of companies, including Western Biomass Energy L.L.C. and Iogen Corp., had set up facilities to produce cellulosic ethanol, with several more announcing plans to follow suit [source: Fehrenbacher].

For more insight on ethanol, have a look at the links below.

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More Great Links


  • Babcock, Bruce. "Statement Before the United States Senate Committee on Agriculture, Nutrition and Forestry." Center for Agricultural and Rural Development; Iowa State University. August 18, 2008. (Accessed Sept. 29, 2008) http://www.card.iastate.edu/presentations/babcock.senateag.8-18-08.testimony2.pdf
  • Cendrowicz, Leo. "Europe Grapples Over Biofuels." TIME. Thursday, May 8, 2008. (Accessed Sept. 25, 2008) http://www.time.com/time/business/article/0,8599,1738434,00.html?loomia_si=t0:a3:g2:r1:c0.18673
  • Ethanol Promotion and Information Council. "Cellulosic Ethanol is Here Today and Coming to a Pump Near You." (Accessed Sept. 23, 2008) http://www.drivingethanol.org/about_us/team_epic.aspx
  • Fehrenbacher, Katie. "11 Companies Racing to Build U.S. Cellulosic Ethanol Plants." Earth2tech. June 3rd, 2008. (Accessed Sept. 22, 2008)http://earth2tech.com/2008/06/03/12-companies-racing-to-build-cellulosic-ethanol-plants-in-the-us/
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  • McPhail, Lihong Lu and Babcock, Bruce A. "Ethanol, Mandates, and Drought: Insights from a Stochastic Equilibrium Model of the U.S. Corn Market." Center for Agricultural and Rural Development, Iowa State University. Working Paper 08-WP 464. March 2008. (Accessed Sept. 25, 2008)http://www.card.iastate.edu/publications/DBS/PDFFiles/08wp464.pdf
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  • National Agricultural Statistics Service, United States Department of Agriculture. "Crop Production." Sept. 12, 2008. (Accessed Oct. 1, 2008). http://usda.mannlib.cornell.edu/usda/current/CropProd/CropProd-09-12-2008.pdf
  • National Corn Growers Association. "Frequently Asked Questions." (Accessed Sept. 29, 2007) http://www.ncga.com/education/main/FAQ.html
  • Peer, Melinda. "Corn Chomps Into Ethanol Producers' Margins." Forbes.com. June 18, 2008. (Accessed Sept. 20, 2008)http://www.forbes.com/2008/06/18/ethanol-producers-closer-markets-equity-cx_mp_0618markets48.html
  • Sachs, Jeffrey D. "How to End the Global Food Shortage. TIME. Thursday, April 24, 2008. (Accessed Sept. 24, 2008)http://www.time.com/time/magazine/article/0,9171,1734834,00.html
  • Seager, Richard, et al. "An Imminent Transition to a More Arid Climate in Southwestern North America." Lamont-Doherty Observatory of University of Columbia. March 2007. (Accessed Sept. 28, 2008)http://www.ldeo.columbia.edu/res/div/ocp/drought/science.shtml
  • Swaminathan, Nikhil. "Dust Bowl 2.0: Is the Southwest Drying Up?" Scientific American. April 5, 2007. (Accessed Sept. 28, 2008)http://www.sciam.com/article.cfm?id=southwest-america-drying-climate
  • Yousfi, Jennifer. "Money Morning -- Corn Price Report." Money Morning. (Accessed Sept. 24, 2008)http://www.moneymorning.com/money-morning-corn-price-report/

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