Article

2007-10-16 International-UN-NGOs

WTO - US loses big on cotton subsidies - billions in fines.

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Posted by 3dc 2007-10-16 00:00|| || Front Page|| [5 views ] Top

#1 Should be good for American consumers, and bad for American taxpayer farmers.

Posted by Bright Pebbles 2007-10-16 06:07|| 2007-10-16 06:07|| Front Page Top

#2 They aren't where you think they are. I've been seeing big growers in the Delta and Texas, which have been heavy into cotton and rice for as long as I've been pushing yield, reporting corn instead. Tens of thousands of acres were shifted out of cotton this last season into corn.

They follow the subsidies, and the subsidies are shifting to ethanol, even in the cotton kingdoms. Don't be surprised if everybody just folds like wet cardboard. They've already shifted into the ethanol scam instead.

Posted by Mitch H.">Mitch H. 2007-10-16 09:48|| http://blogfonte.blogspot.com/]">[http://blogfonte.blogspot.com/] 2007-10-16 09:48|| Front Page Top

#3 The ethanol scam is alive and well in Kansas. Productive wheat acreage being taken out of production as marginal corn acreage goes for the subsidies. Ethanol factories being built while eastern environmentalists block coal fired electrical plants out here in the west. Is Al Gore behind this crap?

Posted by Heriberto Ulusomble6667 2007-10-16 12:16|| 2007-10-16 12:16|| Front Page Top

#4 Ethanol subsidies go to the distillers. Farmers are planting more corn because prices have almost doubled due to ethanol production, not because of corn subsidies which have been decreasing as prices rise.

Cotton should not be subsidized or protected since it is not a critical commodity.

Posted by ed 2007-10-16 13:12|| 2007-10-16 13:12|| Front Page Top

#5 If it's being driven directly by prices, then why is wheat through the roof & corn overplanted, Ed? The agricultural markets are futures-driven, and thus highly vulnerable to herd behavior. There's going to be a rebound into wheat due to the sky-high wheat prices, but for now, for this season, it's corn from the Gulf to Cairo, and from the Rockies to the Three Rivers.

Posted by Mitch H.">Mitch H. 2007-10-16 16:47|| http://blogfonte.blogspot.com/]">[http://blogfonte.blogspot.com/] 2007-10-16 16:47|| Front Page Top

#6 Mitch, want to drive down corn prices? Eliminate the ethanol subsidy. 1/3 of the US corn crop will be used to produce ethanol. Even with the additional acreage planted, there is net less corn for food (some of it is made up by distiller's grain byproduct). By eliminating the $0.51/gal ethanol subsidy, the economic value of a bushel of corn drops by $1.25 (2.5 gals ethanol/bushel), so value of corn for ethanol producers drops by that amount. As long as gas prices stay high and ethanol subsidies flow, more corn will be made into ethanol. In a steady state market, the entire corn crop could be converted to ethanol and therefore food corn prices will follow ethanol prices, not the other way around. It's about using resources (corn, wheat) to make the largest total profit and gov subsidies are part of the equation.

Wheat prices have risen because of drought (esp Australia), substitution by corn acreage and European wheat conversion to ethanol (Yes, it is as stupid as it sounds. Gov policies supplanting market prices.).

Want cheaper food and ethanol? Get rid of subsidies and import tariffs/quotas on Brazilian ethanol/sugar. But that would spill the rice bowl of entrenched interests *cough* farmers, distillers, Florida sugar producers *cough*.

Posted by ed 2007-10-16 18:10|| 2007-10-16 18:10|| Front Page Top

#7 I read an article that Heinz is breeding a supersweet tomato because they foresee a sharp increase in the price/availability of corn syrup for ketchup. There will be some interesting trickle down effects of the ethanol craze, even if it only lasts a year or two. Americans may even lose significant girth, if all the complaints about the hidden corn syrup calories in processed foods are true. ;-) The rest of us may not have to become as disciplined as Rob Crawford!

Posted by trailing wife 2007-10-16 18:22|| 2007-10-16 18:22|| Front Page Top

#8 Reduce or eliminate the corn subsidies. Do the same for suger. Let the market find the most efficient mix between food and biofuel production. Sugar-based ethanol is substantially more efficient than corn-based ethanol, but the money is chasing the corn, because of the subsidies.

Posted by Glenmore">Glenmore 2007-10-16 19:01|| 2007-10-16 19:01|| Front Page Top

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