Food Price Advantage

DDI 2008 Kernoff/Olney

Krishnan Ramanujan

1AC Food Price Advantage

The use of corn ethanol as a fuel has driven food prices up.
Reuters 7-4-08, “Update 1 – Biofuels blamed for food price crisis-report,”
http://uk.reuters.com/article/oilRpt/idUKN0436153420080704?pageNumber=2&virtualBrandChannel=0&sp=true

World Bank President Robert Zoellick has said biofuels are a "significant contributor" to the increase in food prices.

Recently, he wrote in the Financial Times that the use of corn for ethanol by the United States had consumed more than 75 percent
of global corn production over the past three years, and called on the United States and Europe to ease subsidies and tariffs on
biofuels derived from corn and oilseeds.

"The use of corn for ethanol has consumed more than 75 percent of the increase in global corn production over the past three
years," he wrote. "Policymakers should consider 'safety valves' that ease these policies when prices are high," he wrote.

The switch to Brazilian ethanol will reduce the demand for corn ethanol,
reducing crop prices.
Reuters 2-28-08, “Brazilian Sugarcane Industry Welcomes Bernanke’s Remarks on U.S. Ethanol Tariffs,”
http://www.reuters.com/article/pressRelease/idUS293569+28-Feb-2008+PRN20080228

SAO PAULO, Brazil, Feb. 28 /PRNewswire/ -- The Brazilian Sugarcane Industry Association (UNICA) applauds today's remarks
by U.S. Federal Reserve Chairman Ben Bernanke favoring a reduction in tariffs on Brazilian ethanol to help take pressure off
food prices in the United States as a positive approach that goes far beyond economics. In UNICA's opinion, Bernanke's suggestion
favors clean renewable energy, boosts the fight against global warming and defies the distorted logic now in place that taxes
biofuels while fossil fuels move unobstructed around the globe, without trade barriers or any other restrictions.
UNICA President and CEO Marcos Jank called it, "The type of move, if adopted, that would set an example for other
countries and regions of the world to commit to using sustainable biofuels, so that the renewable fuel industry can develop
worldwide in an orderly and productive manner, with due regard for the necessary balance between producing food and fuel."
Brazil is a pioneer in the large scale production and use of ethanol as a motor vehicle fuel, an option it adopted in the mid-seventies
following the first oil crisis. The country is now the world's second-largest ethanol producer, and flex-fuel cars are a runaway success,
accounting for close to 90% of all new car sales in the country. In mid-February, ethanol surpassed gasoline in terms of volume sold
on the Brazilian market. Sugarcane ethanol is also the most cost-effective and energy-efficient biofuel available anywhere in the world
-- for every unit of fossil fuel used in its production, 9 units of renewable energy are generated with a reduction of about 90% in
greenhouse gas emissions when compared with gasoline.
Bernanke told the U.S. Senate Banking Committee that allowing Brazilian sugarcane ethanol to enter the country tariff-free
"will reduce costs in the United States." The remarks were made during an exchange with Senator Wayne Allard (Republican-
Colorado), who asked about benefits of reducing tariffs in order to contain inflation caused by escalating food prices in the United
States.
Bernanke admitted it is difficult to say to what extent demand for corn ethanol is boosting food prices in the U.S., but "a
significant portion of the corn crop is being diverted to ethanol, which raises corn prices." He added that some soybean acreage
has also moved to corn production, which probably has had some effect on soybean prices as well. By way of comparison, Brazil's
entire ethanol production occupies about 1% of the country's arable land.

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Food Price Advantage
DDI 2008 Kernoff/Olney
Krishnan Ramanujan

1AC Food Price Advantage

High food prices cause global famine and food shortages
Hubpages, October 2007, “The Rise in Global Food Prices Is Famine Inevitable,” http://hubpages.com/hub/The-Rise-in-Global-
Food-Prices-Is-Famine-Inevitable
Food riots in some countries recently also show that the situation is serious and if something is not done soon a lot of
people in the world would starve.
Take a look at what some of the experts had to say about this emerging problem:
World Bank: Zoellick Calls For Coordinated Effort To Cope With Rising Food Prices
Josette Sheean, Director of the UN World Food Programme
"We are seeing a new face of hunger. We are seeing more urban hunger than ever before. We are seeing food on the shelves
but people being unable to afford it."
Robert Zoellick, President of the World Bank
"Food policy needs to gain the attention of the highest political levels because no one country or group can meet these
interconnected challenges. We should start by helping those whose needs are absolutely most immediate. The UN's World Food
Programme says that they require at least $500 million of additional food supplies to meet emergency calls. The US, the EU, Japan
and other countries must act now to fill that gap - or many people will suffer and starve."

Food shortages cause extinction

Douglas S. Winnail, Ph.D., MPH, ’96, “On the Horizon”: Famine, From the World Ahead, Sep/Oct,
http://www.survivalplus.com/foods/page0004.html

Perhaps you have been too busy to notice, but the concern about our global food supply is real! Major news magazines are
reporting that after a quiet few decades, talk of a world food crisis is again in the air. Government leaders, economists and scientists
are seriously pondering such sobering questions as: Does the world face a global shortage? and Will the world starve? There is a
growing sense of urgency. In November 1996 the United Nations Food and Agricultural Organization will convene a World Food
Security Summit in Rome. The conference was called due to growing concerns that shrinking world food reserves, rising prices and
the declining production of food grains could be the precursors of an imminent food security crisis. Dr. Jacques Diouf, the FAO
Director-General, has stated, "The very survival of humanity depends on world food security ". Just what does the future hold for
humanity? Will there be enough food to go around? What does a look at all the evidence indicate? And how will this issue affect your
life in the months and years ahead? HOW LONG BEFORE THE CUPBOARD IS BARE? Numerous sources document that global
supplies of rice, wheat, corn and other key commodities have dwindled to their lowest levels in years . The U.N. recently warned that
food stocks stand far below the minimum needed to provide for world food security. The world's grain harvest has not increased in any
of the last five years, and since 1992 world grain consumption has exceeded production... this year--for the first time since World War
II--there are basically no surplus stocks in government-owned reserves. The tight supplies have led to steep price increases for wheat,
rice, and corn. Grain stockpiles have fallen particularly fast in the U.S. and the European Union as a result of agricultural reforms that
have focused on reducing overproduction and selling off surpluses--primarily to China--to gain revenue from exports. Bad weather
and a string of poor harvests in grain producing areas of the world have also contributed to the dwindling reserves. A CRISIS
AHEAD? Opinions are sharply divided over what the future may hold. The world's food economy may be shifting from a long-
accustomed period of overall abundance to one of scarcity and that food scarcity will be the defining issue in the future. The lack of
growth of the world grain harvest since 1990 coupled with the continuing growth in world population and the increased likelihood
of crop-damaging heat waves in the years ahead at least carries the potential of severe food shortages.

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Food Price Advantage
DDI 2008 Kernoff/Olney
Krishnan Ramanujan

Corn Prices Rising

Corn prices are rising due to an increase in ethanol production.
The Star Press 7-27-08, “Burning our Crops for Fuel,”
http://www.thestarpress.com/apps/pbcs.dll/article?AID=/20080727/NEWS01/807270320/1002
As more and more of Indiana's -- and the nation's -- corn crop is diverted to produce ethanol, a homegrown fuel touted as a
renewable, environmentally friendly alternative to gasoline, there is more and more of a backlash .

The controversy is known as food versus fuel, and some wonder if we are burning our crops in our automobile gas tanks in a false
hope of reducing the country's reliance on foreign oil.

Critics include food manufacturers, livestock producers, famine-relief organizations and even bakers.

The global supply of corn has sunk to the lowest level in a quarter of a century, partly because of the growing interest in
ethanol. Food shortages have produced riots in Third World countries. Domestically, there is no lack of groceries but costs are
skyrocketing. The price of eggs and milk and chicken have risen sharply, and if the demand for ethanol persists, that likely will
continue.

And there's no end in sight. Indiana already has eight biorefineries that produce ethanol from corn, and three more plants are nearing
completion. The capacity of those 11 plants is about 310 million bushels of corn a year. An expert at Purdue University estimates
Indiana's corn crop this year at 860 million bushels, meaning 36 percent of the state's corn crop would be diverted to ethanol
production if the plants operate at capacity. Compare that to 2005, when just four percent of Indiana's corn crop went for ethanol
production.

Our reliance on corn ethanol is driving up food prices – must switch to

alternative biofuels.
The Star Press 7-27-08, “Ethanol truths or falsehoods?”
http://www.thestarpress.com/apps/pbcs.dll/article?AID=/20080727/NEWS01/807270377/1002
"The answer is $1 of the $4 is due to the subsidy, and $3 is due to the higher oil price. So corn would have been $5 earlier this year if
we had no subsidies for ethanol. Here's the logic: Higher oil price leads to higher gas price, and higher gas price leads to higher
demand for ethanol because it's a perfect substitute for gasoline. The higher ethanol price leads to more investment in ethanol
plants and more ethanol production. That leads to of course more demand for corn and higher corn price."

The federal subsidy referred to by Tyner is the tax credit of 51 cents for every gallon of ethanol blended in the U.S. fuel supply.

The Grocery Manufacturer Association's response: "High crude-oil prices are providing sufficient market incentives to produce
corn ethanol, making government intervention unwarranted. We believe Congress should revisit and reform food-to-fuel mandate
schedules and subsidies to gradually reduce our reliance on food as an energy feedstock and to accelerate the development of
biofuels that do not pit our energy needs against the needs of the hungry or the environment.

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Food Price Advantage
DDI 2008 Kernoff/Olney
Krishnan Ramanujan

Food Prices Rising

The use of corn for fuel drives up the prices of all crops.
C. Ford Runge is Distinguished McKnight University Professor of Applied Economics and Law and Director of the Center for
International Food and Agricultural Policy at the University of Minnesota, and Benjamin Senauer is Professor of Applied
Economics and Co-director of the Food Industry Center at the University of Minnesota, Foreign Affairs, May/June 2007,
http://www.foreignaffairs.org/20070501faessay86305-p0/c-ford-runge-benjamin-senauer/how-biofuels-could-starve-the-poor.html
Now, thanks to a combination of high oil prices and even more generous government subsidies, corn-based ethanol has become the
rage. There were 110 ethanol refineries in operation in the United States at the end of 2006, according to the Renewable Fuels
Association. Many were being expanded, and another 73 were under construction. When these projects are completed, by the end of
2008, the United States' ethanol production capacity will reach an estimated 11.4 billion gallons per year. In his latest State of the
Union address, President George W. Bush called on the country to produce 35 billion gallons of renewable fuel a year by 2017, nearly
five times the level currently mandated.

The push for ethanol and other biofuels has spawned an industry that depends on billions of dollars of taxpayer subsidies, and
not only in the United States. In 2005, global ethanol production was 9.66 billion gallons, of which Brazil produced 45.2 percent (from
sugar cane) and the United States 44.5 percent (from corn). Global production of biodiesel (most of it in Europe), made from oilseeds,
was almost one billion gallons.

The industry's growth has meant that a larger and larger share of corn production is being used to feed the huge mills that
produce ethanol. According to some estimates, ethanol plants will burn up to half of U.S. domestic corn supplies within a few
years. Ethanol demand will bring 2007 inventories of corn to their lowest levels since 1995 (a drought year), even though 2006
yielded the third-largest corn crop on record. Iowa may soon become a net corn importer.

The enormous volume of corn required by the ethanol industry is sending shock waves through the food system. (The United
States accounts for some 40 percent of the world's total corn production and over half of all corn exports.) In March 2007, corn
futures rose to over $4.38 a bushel, the highest level in ten years. Wheat and rice prices have also surged to decade highs,
because even as those grains are increasingly being used as substitutes for corn, farmers are planting more acres with corn and
fewer acres with other crops.

Corn-based ethanol increases the prices of all foods.

C. Ford Runge is Distinguished McKnight University Professor of Applied Economics and Law and Director of the Center for
International Food and Agricultural Policy at the University of Minnesota, and Benjamin Senauer is Professor of Applied
Economics and Co-director of the Food Industry Center at the University of Minnesota, Foreign Affairs, Sept/Oct 2007,
http://www.foreignaffairs.org/20070901faresponse86512/tom-daschle-c-ford-runge-benjamin-senauer/food-for-fuel.html
First, we, too, know that meat-producing animals eat more than half of the U.S. corn crop. But people do eat chicken, eggs, pork,
steak; drink milk; and consume foods containing cornmeal, corn oil, and corn sweeteners. U.S. consumers spend over 20 percent
of their food budgets on meat, eggs, and dairy. And the share of the corn crop used to produce ethanol will rise from less than ten
percent in 2004 to an expected 20-25 percent of the crop next year. As more acres are devoted to corn, fewer acres are
available for other types of dairy feed, such as alfalfa, or for table vegetables, such as green beans. As a result, milk and vegetable
prices are rising. And as acres are bid away from soybeans and turned over to corn, the price of soybean-based feed is also
increasing, adding to the pressure on meat prices. In March 2007, the U.S. Department of Agriculture forecast that demand for
ethanol would push the prices of poultry, pork, and beef higher. The Wells Fargo economist Michael Swanson noted in June 2007
that the rising costs of corn and soybean feed also "have a direct and significant impact" on "oils, cereals and bakery products." Corn-
based ethanol, Swanson concluded, "is indeed responsible for the increased rate of food inflation" (even though it is not its sole
cause).

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Food Price Advantage
DDI 2008 Kernoff/Olney
Krishnan Ramanujan

Sugar cane doesn’t affect food prices

Cane ethanol doesn’t increase food prices – Brazil proves.
UNICA, União da Indústria de Cana-de-Açúcar, 2008, http://www.sugarcaneethanolfacts.com/about-sugarcane-ethanol.html
Cane ethanol production has not impacted the production or price of food in Brazil. With only 1% of its arable land
dedicated to sugarcane for ethanol production, Brazil has been able to replace half of its gasoline needs with sugarcane
ethanol - making gasoline the alternative fuel. While cane production has increased steadily in recent years, food
production in Brazil has grown dramatically without any material price increases. In fact, grain and oilseed harvest has
doubled in the last ten years.

Cane ethanol doesn’t affect prices – different cane types are used for fuel than food.
The Economist 6-26-08, http://www.economist.com/world/la/displaystory.cfm?story_id=11632886
But might ethanol be indirectly responsible for lifting food prices and for pushing cattle ranchers into the Amazon?
Such concerns look premature. Sugar cane occupies only 7m hectares (17m acres) of Brazil’s farmland (and only about
half of the crop is distilled into ethanol). This compares with some 200m hectares devoted to cattle ranching, much of which
is extensive (a Brazilian cow enjoys, on average, a lordly hectare of grazing). Sugar could expand on degraded pasture with
little or no effect on beef prices.

Besides, the ethanol industry may be poised for a leap in productivity. “The sugar-cane plant is now where corn was at the
beginning of the 20th century,” reckons Fernando Reinach, a biologist turned venture-capitalist at Votorantim, a conglomerate.
His fund has backed two start-ups in Campinas in São Paulo state.
Click here to find out more!

One of them, CanaVialis, breeds better varieties. The other, Alellyx, alters the genes in the plant to give them new
properties (one strain being tested gives about 80% more sucrose; another can go for 45 days without water). It is run by Paulo
Arruda, a Brazilian who led a team of 200 people in sequencing the DNA for sugar cane. Across the road is Amyris, a
Californian company which has developed enzymes that in laboratory experiments have turned sugar into substitutes
for motor and jet fuel

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Food Price Advantage
DDI 2008 Kernoff/Olney
Krishnan Ramanujan

Impact – Poverty and starvation

We must switch to sugar cane ethanol – price rises lead to poverty and
starvation.
C. Ford Runge is Distinguished McKnight University Professor of Applied Economics and Law and Director of the Center for
International Food and Agricultural Policy at the University of Minnesota, and Benjamin Senauer is Professor of Applied
Economics and Co-director of the Food Industry Center at the University of Minnesota, Foreign Affairs, May/June 2007,
http://www.foreignaffairs.org/20070501faessay86305-p0/c-ford-runge-benjamin-senauer/how-biofuels-could-starve-the-poor.html

This might sound like nirvana to corn producers, but it is hardly that for consumers, especially in poor developing countries,
who will be hit with a double shock if both food prices and oil prices stay high. The World Bank has estimated that in 2001, 2.7
billion people in the world were living on the equivalent of less than $2 a day; to them, even marginal increases in the cost of
staple grains could be devastating. Filling the 25-gallon tank of an SUV with pure ethanol requires over 450 pounds of corn --
which contains enough calories to feed one person for a year. By putting pressure on global supplies of edible crops, the surge in
ethanol production will translate into higher prices for both processed and staple foods around the world. Biofuels have tied oil
and food prices together in ways that could profoundly upset the relationships between food producers, consumers, and
nations in the years ahead, with potentially devastating implications for both global poverty and food security.

6
Food Price Advantage
DDI 2008 Kernoff/Olney
Krishnan Ramanujan

No impact on Amazon
Sugarcane is harvested far from the Amazon – no impact on biodiversity.
UNICA, União da Indústria de Cana-de-Açúcar, 2008, http://www.sugarcaneethanolfacts.com/about-sugarcane-ethanol.html
No. Sugarcane for ethanol is harvested more than 1,550 miles from the Amazon-roughly the distance between New York City
and Dallas, or between Paris and Moscow. Ninety percent is harvested in South-Central Brazil and the remaining ten percent is
grown in Northeastern Brazil.

Less than 0.2% of Brazil's total sugarcane production is processed at four mills in the Amazon that were built more than 20
years ago - at a time when the government provided fiscal incentives to set up industrial facilities in this region.

Sugarcane doesn’t hurt the Amazon – it’s harvested thousands of miles away.
The Economist 6-26-08, http://www.economist.com/world/la/displaystory.cfm?story_id=11632886
For those worried about climate change, Brazilian ethanol is worth buying only if it is as green as it claims to be. It is certainly much
greener than its corn-based rival in America: it packs 8.2 times as much energy as is used in its production, compared with just 1.5
times for corn ethanol, according to the Woodrow Wilson Centre, a Washington think-tank. Some greens say that the spread of
sugar is deforesting the Amazon. That is not true. The vast majority of the sugar crop is grown thousands of miles away from
the forest, in São Paulo state or the north-east. Some 65% of new planting of sugar cane has been on land that was previously
pasture; the rest was previously used for other crops, according to Conab, a government agency.