Biofuels, Natural Gas Prices and Farm Subsidies
Dramatically rising food prices are linked to the expanded use of biofuels.
Natural gas prices in the U.S. rise 93% in eight months.
Political wrangling continues over the 2007 federal farm bill.
1. INTERNATIONAL
Dramatically rising food prices are linked to the expanded use of biofuels.
CEI Expert Available to Comment: Adjunct Analyst Steven Milloy on expanding impact of using food for fuel:
“Food riots also broke out in Egypt, Cameroon, Ivory Coast, Senegal and Ethiopia. The military is being deployed in Pakistan and Thailand to protect fields and warehouses. Higher energy costs and policies promoting the use of biofuels such as ethanol are being blamed. ‘When millions of people are going hungry, it’s a crime against humanity that food should be diverted to biofuels,’ an Indian government official told the Wall Street Journal. Turkey’s finance minister labeled the use of biofuels as ‘appalling,’ according to the paper.”
2. ENERGY
Natural gas prices in the U.S. rise 93% in eight months.
CEI Expert Available to Comment: Senior Fellow Marlo Lewis on what’s fueling this dramatic price increase:
“Thanks to the development of methods for super cooling and transporting the fuel across the ocean in liquefied form, natural gas is now a global commodity. Other things being equal, this helps moderate U.S. gas prices, by increasing the supply available for domestic consumption. But it also means that U.S. prices now reflect not only U.S. demand but also fast-growing demand in India and China. In addition, competition for liquefied natural gas imports in the global marketplace means that high prices in Japan, for instance, exert upward pressure on prices in the United States.”
3. AGRICULTURE
Political wrangling continues over the 2007 federal farm bill.
CEI Expert Available to Comment: Adjunct Fellow Fran Smith on what’s at stake in the debate:
“With negotiations stalled on the 2007 Farm Bill, President Bush is expected to sign a one-week extension of the current law so that lawmakers and the Administration can try to resolve issues. Without that extension, farm programs would revert to a 1949 law that would increase even more the huge subsidies farmers receive. The major contentious issues between the Administration and Congress are the funding of the $286 billion package over five years and high income limits — $2.5 million in adjusted gross income — for farmers eligible to receive subsidies. Check out CEI’s video “Farming for Dollars” on how the farm bill hurts consumers, taxpayers, and the poor.”
Blog feature: For more news and analysis, updated throughout the day, visit CEI’s blog, Open Market.
FOR MORE INFORMATION
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