The Corn Store - Energy

As I outlined yesterday, your local grocery store is about 25% corm.  Both politics and biology have played major roles in filling up the aisles with corn.  The other variable that allowed this to happen was energy.  Not just any energy, but cheap energy.  When you add together the natural gas in the nitrogen fertilizer to the fossil fuels it takes to make the pesticides, drive the tractors, and harvest, dry, and transport the corn, you find that every bushel of Iowa corn requires the equivalent of between a quarter and a third gallon of oil to grow it - - or around 50 gallons of oil per acre of corn.  Engineers would say that it takes more than a calorie of fossil fuel energy to produce a calorie of food (keep in mind that before the advent of chemical fertilizer, namely nitrogen, the typical Iowa farm produced more than two calories of food energy for every calorie of energy invested).  This all makes perfect sense, right up to the point of $150 per barrel oil (What about ethanol?  Using high BTU energy sources to produce, transport, and distribute low BTU energy sources has lots of lukewarm thinking embedded in it).

Every increase in productivity can be traced to an external input.  Engineers are more productive than we were 50 years ago namely because of a technology input - - we design things better and faster because of an external input of lines of computer code.  To run all those servers and workstations, it also took an input of cheap energy in the form of electricity.  Chicken consumption in the United States is up approximately 90% since 1980.  This is fundamentally a function of declining unit costs.  The primary external input that has produced this huge productivity increase is cheap energy (not much computer code regarding your basic chicken).  Cheap energy for food, climate control for confinement buildings, processing, and distribution - - the entire value chain is a function of cheap energy (Processing has benefited from low-skill, low-wage labor - - namely in the form of illegal immigrants - - that was another key input).

When you see huge productivity improvements - - think in terms of what were the external factors that produced the improvements.  Then ask - - are the inputs sustainable at the current production levels?