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Majority of Americans Support Ethanol

by: Tim Plaehn July 20, 2008 | about stocks: AVR / PEIX / VSE    
Tim Plaehn

Tim Plaehn

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Renewable Fuels Association poll results

The Renewable Fuels Association contracted a pair of polling firms to survey voters' beliefs on ethanol as a renewable fuel. Two firms were selected to get both Democratic and Republican opinion. The opening paragraph of the report, linked above, gives the results:

 

The on-going campaign to force the nation to revisit and reduce its commitment to ethanol has failed to move most American voters. A recent bi-partisan survey of 1,200 registered voters shows that by a 2:1 margin, the public supports increased use of ethanol in our nation’s fuel supply. This majority crosses party lines, capturing conservatives and environmentalists alike. Voters largely blame the rising cost of food on fuel prices; less than one in ten blame the expanded use of ethanol.

 

59% of voters support increased use of ethanol while 30% oppose. The survey oversampled environmentalists and in that group 63% supported increasing ethanol production. Also, voters polled believe higher oil prices are causing increased food prices by a margin of 71% to 17%.

It appears the anti-ethanol campaign has failed to sway the American voting public, so I doubt elected officials will be changing the current laws regarding ethanol. My contention that ethanol is a growing integral part of the U.S. motor fuel infrastructure continues to strengthen. Those that think corn based ethanol will soon be history are in the wrong (and smaller) camp.

As this is an investment oriented site, take a look at VeraSun Energy (VSE) when they release their quarterly earnings early in August. You may be surprised.

Note: I have a long position in VSE.

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This article has 73 comments:

  •  
    Jul 20 04:39 AM
    The studies that have been done regarding Ethanol are not encouraging. It may actually be a net energy loser. I suggest the author do a little research before further misinforming an already misinformed public.
    Reply
  •  
    Jul 20 08:00 AM
    Corn ethanol is at best a marginal source of energy, and at worst a net loser. If the American public really believes in ethanol, then they're wrong. Public opinion can change.
    Reply
  •  
    Jul 20 08:25 AM
    Ethanol can not exist without substantial government subsidies making it more expensive than gasoline. Further, it gets only 80% or less mileage than gasoline per gallon. 25% of our corn crop has been taken out of the food supply for ethanol causing all food prices to rise.
    When taking a poll, the results are affected by the way the question is worded. In this case, I believe the poll's question was worded to favor ethanol.
    Reply
  •  
    Jul 20 08:26 AM
    loser aspects: to grow corn requires lots of fertilizer which requires lots of energy (natural gas), also lots of water at the right time. current corn prices work against crop rotation; a monoculture year after year depletes the soil, also potentially leads to corn blight affecting large areas. i remember the blight we had in the midwest in 1970, too much heat & humidity & a monoculture. in the EtOH manufacture from corn, energy can be supplied by burning coal & chopped-up rubber tires in a CFBC (see ADM).

    moral question: should corn be used to feed automobiles or to feed humans who are starving?
    > jack
    Reply
  •  
    Jul 20 08:39 AM
    Well thank you for disclosing your long position in VSE. I have no position in any energy-company stock.

    I agree with the previous commentators. The results depend on how the questions are framed -- in particular if no distinsction is made between corn ethanol and ethanol made from non-grain feedstocks.

    Another survey [50 kb PDF], conducted in May by a group that has <em>no</em>... connections to the ethanol industry (unlike the Renewable Fuels Association), found that 42 percent of the participants in the survey thought that that the mandate should be eliminated to reduce ethanol production and use. One-quarter percent wanted the mandate to be partly eliminated to reduce ethanol production and use, and 16 percent wanted it left unchanged. Of the rest, 6 percent wanted it partly expanded to increase ethanol production and use, and 2 percent wanted it significantly expanded to increase ethanol production and use.
    Nine percent were undecided, didn't know what to answer, or refused to answer.

    Even among people living in the Farm Belt, 25 percent percent said they wanted the ethanol mandate repealed entirely, and another 30 percent wanted it scaled back.
    Reply
  •  
    Jul 20 08:40 AM
    Sorry, here's the link to the aforementioned survey:

    www.nationalcenter.org...
    Reply
  •  
    Jul 20 08:41 AM
    Corn-based ethanol is a long-term net loser for everyone, as it increases the price of corn, which is a fundamental food source, and uses more energy and other inputs. There is short term benefit to the corn farmers, fertilizer companies, seed companies, and ethanol producers. The questions of the survey were obviously oriented to get the desired response.
    Reply
  •  
    Jul 20 08:47 AM
    In addition, this situation is contributing to the largest dead zone in the gulf from New Orleans to Galveston and below due to the effluent of nitrogen and phosphates in the Mississippi river, which naturally is destroying the shrimp and crab industries in this geography.
    Reply
  •  
    Jul 20 08:50 AM
    And... If this was nothing more than a farm bill, sold as an energy bill, why do we impose a tariff on cellulose and sugar cane ethanol from Brazil, (around 57cents I think) which is cheaper, has less impact on world food and commodities and performs better as a fuel supplement. Perhaps Monsanto wrote the current bill.
    Reply
  •  
    Jul 20 09:00 AM
    Corn biofuel is a waste of subsidized tax dollars..it is using more fossil fuel to produce a gallon than by itself...It has 30-40% less BTU per gallon than oil based...We need to make food out of corn and use the renewable low cost high efficient algae based biofuel that is not hurting other groups and by the use of warm h2o, breed new units in days not a limited access season It is also capable of liquid hydrogen.. runnig of current through h2o to the edge of conductivity ..becoming more functional than at 100% where scientific research is at..there are small research group able to do this NOW..
    Reply
  •  
    Jul 20 09:16 AM
    John: to be precise, the U.S. import tariff is 2.5% of the f.o.b. value of the ethanol, plus $0.54 per gallon (including the denaturant). At current export prices for Brazilian ethanol, that comes to around $0.60 per gallon in total.

    Also, most life-cycle analyses of corn ethanol show a net return of energy compared with the fossil energy that went into producing it. But that is neither here nor there: lots of energy forms are profitable to make by using cheaper, less-convenient energy. That is what happens when electricity is generated from coal, for example.

    What is more important is that, ignorring land-use effects, corn ethanol yields only small improvements in greenhouse gas emissions. When prairie land is ploughed up to plant corn for ethanol, it is a net loser. And when Amazon forest is cut down to plant soybeans as a result of expanding corn acreage at the expense of soybean production in the United States, it becomes an important contributor to GHG emissions.

    Tim Plaehn may be right that it is too early to sound the death knell for corn ethanol. But that is because the lobby for it is so powerful, not because corn ethanol makes any economic or environmental sense.
    Reply
  •  
    Jul 20 09:31 AM
    Let's see, send my money to the oil companies and Arabs or send it to the farmers....
    Reply
  •  
    Jul 20 09:33 AM
    Voting makes no sense in determining if anything should be used in the market place. Take away the subsidies and ethanol is gone.
    Reply
  •  
    Jul 20 09:49 AM
    We need to move to Natural Gas to propel our vehicles.
    Reply
  •  
    Jul 20 10:10 AM
    john s. gordon: Please don't use the "people are starving" argument. For one people have been starving in undeveloped countries for thousands of years and ethanol hasn't changed this unfortunate circumstance one way or the other. Second - Americans waste so much food it's a sin. Just look at what your local buffet throws out in the garbage. Furthermore in my state by law that wasted food must be thrown out, and can't be given to any homeless shelter or charity. Mangolfer: Yes it's that simple! Keep the money in the U.S. or continue to fund the very people that kill/maim our troops.
    Reply
  •  
    Jul 20 10:16 AM
    In answer to mangolfer: Let's see, rob from taxpayers (via subsidies) and transfer som of that to people who already owned farms worth millions of dollars (farm prices in Iowa increased 22% between 2006 and 2007 alone -- by $30 billion across the whole state), and some of it to welfare cases like Archer Daniels Midland. In the process, drive up the costs of feedgrains for livestock producers and catfish farmers, not to mention the cost of grains all over the world. Gee, what a deal. And for displacing only 3.5% of gasoline needs (1.7% of all petroleum consumption) -- less than could be saved if all drivers kept their tires properly inflated. Sounds like a great deal to me!
    Reply
  •  
    Jul 20 10:26 AM
    In answer to bm1087. Does 1087 stand for October 1987, the year you were born? It might explain your callous attitude to the poor of the world.

    Yes, there have always been hungry people in the world. But the recent rises in the prices of grains and oilseeds have hit the urban poor in developing countries particularly hard. Analysts at the World Bank estimate that biofuel policies (in the EU as well as in the USA) have accounted for more than 2/3 of the increase in food-commodity prices since January 2002. Commodities only account for 20-25% of the final cost of food purchased in America, where the typical diet includes highly processed and highly packaged items. And Americans spend only 10% of their income (obviously more if you are poor), on average on food, whereas people in the poorest third of the world spend 50% and in some cases 70%. Those people do not eat Corn Flakes, they eat corn meal, or corn flour, or cracked wheat -- products for which the price of the grain accounts for a large percentage of the final price of their food.

    For them, the biofuel-driven price rises have been a disaster.
    Reply
  •  
    Jul 20 10:34 AM
    Voters, including farmers, need some education on the evil that is corn-based ethanol.
    Reply
  •  
    Jul 20 10:43 AM
    Here we are once more sweating the small stuff. When Al and his buddies finish with us after this year's election, we won't be able to afford corn to eat or put in our gas tanks.
    Reply
  •  
    Jul 20 10:44 AM
    Is corn fuel ethanol policy a Big oil welfare program.

    Some folks think so
    Reply
  •  
    Jul 20 10:46 AM
    Should a grand jury consider the cause of death of Alexander Farrell, 46, expert on alternative fuels?



    www.sfgate.com/cgi-bin...
    Reply
  •  
    Jul 20 10:47 AM
    Should Gov. Arnold Schwarzenegger consider a fee on corn fuel ethanol use?



    * * Lower price for food, gas, water, beer, cleaner air and funds for the budget from oil profit.
    Reply
  •  
    Jul 20 11:02 AM
    The majority of Americans are stupid and it's for reasons like this.
    Reply
  •  
    Jul 20 11:03 AM
    the majority is usually wrong. just picked up pbr on the dip. cost effective ethanol, future oil production and a fertilizer division. thank you PAUL8756 and STOCKACCUMULATOR. i will increase my position if this pullback will hold a little longer. it seems logical to ramp up all energy production and to be drilling here. we need the energy. none of it will help on monday or tuesday. ethanol production needs to follow the south american example. i do not like subsidies. if it does not work financially take a new course and try the old course again if and when it becomes profitable. i do not think PICKENS PLAN is complete in that he seems to be leaving out nuclear and oil. i have only heard one of his adds, and have not had time to go to his website. one thing for sure he has made more money than most of us and that success means he deserves to be heard. at least he is not sitting on his hands worrying about votes or campaign donations. while i love nature and clean land the extremist green movement is an exorbant luxury we cannot afford right now. we need energy. iam for developing all of the new technologies but i want it to make us richer not poorer then we can afford to be greener. but even with all of it we still are going to need more oil for decades. if a man is starving with his family he does not give a damn if it is the last dolphin on earth. flipper will be eaten. wealth is what makes environmentalism even possible. if we face reality we have a chance but i fear that that is asking to much of the dumbed down public. if pickens is open to outside investment i will certainly try to ride his coattails.
    Reply
  •  
    Jul 20 11:15 AM
    this is an aside for those who are trying to move dollars to metals. on saturday morning i went to my coin dealer to purchase a couple of hundred silver dollars. he had 33 that were going at bullion plus minting premium prices. he had no gold coins. he said that he connot keep gold bullion coins either. he had none. that was one small dealer but this is the first tmie in twenty five years he did not have all that i wanted to buy. i am sure i will be able to find the rest if i decide to look harder.
    Reply
  •  
    Jul 20 11:19 AM
    JOHN S GORDON the more i read your posts the more i think you would like gbrc. i hope you have caught one of my messages to take a look.
    Reply
  •  
    Jul 20 11:23 AM
    Wow. I was opposed to ethanol from the very start, even before news of the "energy loss" of production was known. I simply cannot support, morally, using farmland to do anything but feed people and animals. Particularly in light of the part weather has played most recently in production and distribution worldwide. I've learned a lot from posters here, thanks. Part of the answer to energy dependency in the US is obviously conservation (which I don't think we will ever "get"), more domestic production, better fuel efficiency technologies and, well, better BATTERIES too. Can anyone speak with authority on batteries?
    Reply
  •  
    Jul 20 11:51 AM
    Further to the topic of renewable energy as a whole, solar power technologies are essential. Wind farms make me really nervous. The positive aspects aside - I can't help worrying about the impact on sealife and the migratory patterns of birds and other land animals. Does anyone have any fact-based intelligence on this issue?
    Reply
  •  
    Jul 20 12:18 PM
    Tim

    Don't you wonder where all these people with wild ignorant statements with nothing to back them up come from? Are they being generated by some hacker?
    Reply
  •  
    Jul 20 12:28 PM
    Charlie Peters, with insightful comments such as yours...you really should write a book...wow. Probably would be a best seller! Any other nuggets of wisdom to help the world solve the energy problems?
    Reply
  •  
    Jul 20 12:51 PM
    The majority of Americans also consider "American Idol" fine art and entertainment. But I wouldn't trust them to pick my investments for me.

    Yes, some things are done due to populist sentiment, but it won't be long before even the masses are informed about what a bad idea corn based ethanol was. They have near ZERO motivation to push for it as a fuel once it's explained that it makes no sense economically, enviromentally, or even morally.

    It's just a matter of time before those who chose to invest based on this boondoggle crash and burn.
    Reply
  •  
    Jul 20 03:05 PM
    Even delusional elitists, such as I, have to suppress a gag reflex whenever anything purports to extrapolate on ‘all Americans’ or “majority of Americans” or, my favorite, the “masses”. Much too much nonsense is generated by self-serving data farming and after the fact data refining from all persuasions. Also tiresome is the attribution to ‘Americans’ of failings common to humanity as if America had a corner on the market. The masses stubbornly refuse to accord their obviously ethical and moral and mental superiors the deference they warrant. Really, should most people be allowed to vote?
    Reply
  •  
    Jul 20 03:14 PM
    the media would convince you that Al Gore is correct about his global warming disaster, but with everyone worried about this winter's heating oil cost and activating their iphones and going to see batman during the summer reruns on tv, I am not sure I know what to believe. I may need to watch Oprah!
    Reply
  •  
    Jul 20 03:23 PM
    Nice choice. Energy or food.
    With everyone in crisis mode regarding the US economy,
    this sounds like "rearranging deck chairs on the Titanic".
    From a scientific and economic standpoint, "growing energy"
    is a net loser, despite popular opinion; which is just that, opinion spoon fed by the media & politicians.
    Reply
  •  
    Jul 20 03:29 PM
    BTW this is analogous to the Germans figuring out how to make gasoline from coal during WWII. It worked & they had the coal, but they lost interest due to the economics after the war.
    Reply
  •  
    Jul 20 03:32 PM
    SEARCHER there were 3 restrictions in the origional voting laws. no government employees or anyone who recieves a government stipend, no non property owners, and no debtors because these groups have a conflict of interest. before i get accused of racism or sexism those problems have been corrected already. i am the ultimate non racist non sexist. i do not care if you are male female or something in between, black, white, red, green or blue get off the government tit get to work and pay your own way. and yes searcher i think those restrictions should apply. hard to buy a mans vote if he wants nothing from you. you are correct americans have no corner on the market of stupidity or sheep like behaviour. TEXASGOLFER that was funny and on the pulse. it is sad too. SEARCHER do you believe the majority of americans are behaving in an intelligent manner?
    Reply
  •  
    Jul 20 03:46 PM
    perhaps your questionnaires could have been worded like this which I am quite certain they were not...If you were aware Senator Grassley,R-Iowa and Family received million$ in Farm Subsidies would this affect your stance on Ethanol?....Or do you think it would be ethical for Senator Grassley to even vote on the $300B Farm Bill knowing his pro-corn/ethanol stance?...or Do you believe 1 gallon of Ethanol is worth 1700 gallons of fresh H2O the average amount of water nescessary to make that 1 gallon?...or When you buy a dozen eggs this year for 2.50/dozen and last year those eggs cost 1.25/dozen do you believe the Corn which goes into the feeding of chickens that lay those eggs or making Ethanol from the same corn has anything to do w/ the increased price?...you will get a different end result!!! I would say your 2:1 in favor goes to 1:2 at best!


    you see like the previous posts have illuminated...How you ask and the wording can make a difference in answers! Even the American public which is not too bright would see through the Ethanol Conspiracy!
    Reply
  •  
    Jul 20 04:41 PM
    Sugar ethanol to be used (CZZ) in europe. Debatable if we will go that route as Brazil may send most of it europes way with Sweden stepping to the plate first methinks.
    As for corn, 7years of feeding it to my cat via Friskies has given him Chronic Renal Failure, the most prevalent feline disease and every morning when I give him his shot of saline solution to keep him alive he looks out through the slider window at the corn fields and curses Monsanto ADM and Nestle. He leaves a shriveled up tater in the field at night, that's his rationale and thoughts about ethanol.
    Reply
  •  
    Jul 20 07:01 PM
    SHENENDOAH so are you going to back up your statement? were you generated by a hacker?..........SEARC... read the title to the article again. it has nothing to do with anything but american opinions.
    Reply
  •  
    Jul 20 07:53 PM
    Over the past 30 years we killed nuclear, we killed additional drilling in the most productive areas, we killed many wind projects in various states (because of birds and aesthetics), we are making coal taboo, biofuels like ethanol are getting killed, and large scale solar in the deserts is being questioned on environmental grounds. We are our worst enemy and the comments here demonstrate that. Lots of complaining, no solutions.
    Reply
  •  
    Jul 20 08:38 PM
    BACON pickens is the only one offering any solution. i do not have enough to start a movement but i will as i said add a drop in the bucket if pickens allows inv