Listen to JohnTS that is the real story on biofuels. His point about the CRP is also important. There presently is 34 million acres of cropland that the government is now paying to keep OUT of production. Not all of this is quality cropland, but a good portion is. The market is responding to higher prices and that land is slowly (2 million acres per year) coming back off contract and back on line. This will help increase the supply of all commodities and prices will moderate as supply and demand go toward equilibrium. If the government did not have these CRP acreages under contract or if it would early allow opt out of the program, these acres would be available now alleviating these price spikes. Any remaining marginal acres could be used to jump start cellulosic ethanol production. Again our friends the environmentalists are fighting any change to allow early exit from the CRP program without the huge penalty. This means CRP acreages will remain inaccessible for up to ten more years. Thank the greens once again for making our lives difficult, but even more so for making lives of those in less developed countries miserable.
