The only thing we can be sure of about the future is that it will be absolutely fantastic. So if what I say now seems to you to be very reasonable, then I have failed completely. Only if what I tell you appears absolutely unbelievable, have we any chance of visualizing the future as it really will happen.
- Arthur C. Clarke (h/t Brin)
Thursday, May 5, 2011
I see it here being flogged bit by a biofuels interest group, but I'm not sure I'm going to take their word for anything.
So what does this mean? We see that oil at $25 leads to food at 90 while oil at $100 leads to food at 180. Consider the simplest formula
food = G + H * oil
Then G = 60 (fixed cost) and H = 1.2 (units per dollar in oil price)
So at the baseline, non-energy costs of production are 2/3 of the total while at the peak they are 1/3. Any further increases will track the fuel prices even more closely.
The breakdown of the food index is here.
The question I have is why there is so much energy in food. The claim that it is about shipping is very unconvincing. This volatility must be a severe stress for poorer countries where food dominates the household budget. How hard would it be to break this link? If fuel continues to rise, can some of the energy be subsituted by human labor?
How much of this energy link traces to the manufacture of artificial fertilizer? Presumably that is not shown, because the fertilizer is made using a natural-gas based process, and gas prices have not risen. But that means an even bigger slice of the cost of food is just fossil fuel, right?
Can we feed the world without artificial fertilizer?
Can we feed the world without carbon emissions?
Posted by Michael Tobis at 10:54 PM