Is Ethanol Creating A New 'Ear Economics'?

Process Plus counters the claims that corn is now a 'four-letter' word due to ethanol production. The company asserts that corn for ethanol has a minimal effect on food prices; rather energy prices are the culprit of rising food prices. Process Plus, headquartered in Cincinnati, Ohio, is an engineering and design firm that builds ethanol production facilities across the United States.

"Rising food prices are primarily due to two facts, explains Grant Mitchell, VP and partner at Process Plus. First, higher income people in China have increased their demand for food and secondly, crude oil is selling at record highs, affecting not only the transportation of food but also the cost of fertilizer. Therefore, with demand already high, the effect of corn to ethanol is amplified."

Recently Ed Schafer, the US Secretary of Agriculture, addressed criticism that US subsidies for corn-based ethanol production was driving food price inflation around the world. Critics who blame high food prices on US policies they say encourage corn to be diverted from food and livestock feed use to alternative fuels are "flat out wrong," said Schafer.

According to Ed Shafer, energy costs, increased consumption around the world, and weather-related production problems have more to do with rising prices in corn than ethanol.

The company plans to post facts about the new 'ear economics' on its website, www.processplus.com. "While energy initiatives in the US and around the world are driving the demand for corn, we have a responsibility to accurately inform employees and stakeholders of the story beyond the headlines," states Jim Wendle President of Process Plus.

In 2007, US growers planted 24 percent more corn, which supplied all the corn that went into ethanol for the year. Specifically, 13,200,000,000 bushels of corn were produced with 2,400,000,000 bushels going to ethanol leaving 10,800,000,000 available for food or other purposes. "For 2008, if we produce 10 billion gallons of ethanol, 3.7 billion bushels of corn would be required out of the 12.1 billion bushels projected for harvest," explains Mitchell.

As a process engineer, Grant Mitchell has spent over 25 years working in agricultural-related businesses. He explains that the by-product of corn conversion to ethanol is DDGS. This is a source of protein and is used as feed for cattle and other animals. "Farmers in the Midwest don't have enough animals to keep up with supply of DDGs, which is another fact that is contrary to popular claims that corn for ethanol is responsible for a food shortage," says Mitchell.

For more information on corn for ethanol production visit ethanol.org or contact Grant Mitchell at (513) 618 4723. Process Plus is a privately held engineering firm headquartered in Forest Park. They provide process and facilities engineering and design, architectural, and construction services to the Chemical, Renewable Fuels, and Pharmaceutical Industries. Process Plus serves clients throughout North America, South America, Europe, Africa, and Asia.