Posted: June 25, 2008
The Farm Foundation just concluded a conference in their series titled, “Transition To A Bio Economy.” This one was on risk, infrastructure and industry evolution and all the presentations were on biofuels. I conducted a series of interviews with the presenters which you can find with this link.
One of them has done some interesting research on the link between the volatility of ethanol production and corn prices. He is Michael Wetzstein, University of Georgia. His talk dealt with two issues. One is on price volatility and the other is on food and fuel. Michael says that gas price volatility can be avoided with fuel diversification by blending renewable fuels with fossil fuels.
Another part of his research is on food and fuel and to answer the question of “Is there a direct link between the volatility of ethanol production and the volatility of corn prices. His research has found that there is a link but not a persistent or long lasting one. In fact, in the long run he says there is no direct link.
The bottom line he says is that we just need to produce more food. After talking to Iowa corn growers last weekend, I can say that American farmers are certainly doing their best.
You can listen to my interview with Michael here: