Hypocrites on this site

[samhill]

Simple me,I don't see why this can't be done, we grew hay for horses.

[dmlfarmer]

And the hypocrisy continues. Go back and read AF5's initial post. It is one of the best posts I have read on this site. Pay close attention to "We all sound the same, government is the problem don't tax me, don't tell me what to do, let the free market function. Until the free market tells us that it doesn't want our product at the price we like, then suddenly we demand that government step in and fix the obviously broken free market for us."


Yet it seems everyone is jumping on the bandwagon for a mandated biofuel initiative. This is nothing more than a disguised tax. If biofuels were economical, investors would have built the plants needed already without a mandate or subsidies.

A mandate would mean higher fuel prices for everyone, exactly what a carbon tax does, as the higher biofuel cost gets transferred to the consumer. Yes, farmers may gain initially, but any price spike would quickly be lost as production ramps up as a result of higher prices. Given global trade, if Canada could not meet demand for biofuel production, decreased exports and even imports of commodities to meet the increased demand would put a ceiling of prices. Just look at the production increase in corn to meet the ethanol mandate in the US. Prices did go up but production increases outstripped even the new ethanol demand and now real dollar prices for corn are lower than ever.

At best, a mandate is a zero sum game for farmers over the long term. The only real winners are the investors who put up the funds to build the plant for which there is a guaranteed demand for a product which is not competitive in a true free and open market.

And contrary to a carbon tax which everyone understands is a penalty for using carbon based fuels (which biofuels do still contribute too) a mandate provides no psychological incentive to reduce fuel usage.

[AlbertaFarmer5]

And the hypocrisy continues. Go back and read AF5's initial post. It is one of the best posts I have read on this site. Pay close attention to "We all sound the same, government is the problem don't tax me, don't tell me what to do, let the free market function. Until the free market tells us that it doesn't want our product at the price we like, then suddenly we demand that government step in and fix the obviously broken free market for us."


Yet it seems everyone is jumping on the bandwagon for a mandated biofuel initiative. This is nothing more than a disguised tax. If biofuels were economical, investors would have built the plants needed already without a mandate or subsidies.

A mandate would mean higher fuel prices for everyone, exactly what a carbon tax does, as the higher biofuel cost gets transferred to the consumer. Yes, farmers may gain initially, but any price spike would quickly be lost as production ramps up as a result of higher prices. Given global trade, if Canada could not meet demand for biofuel production, decreased exports and even imports of commodities to meet the increased demand would put a ceiling of prices. Just look at the production increase in corn to meet the ethanol mandate in the US. Prices did go up but production increases outstripped even the new ethanol demand and now real dollar prices for corn are lower than ever.

At best, a mandate is a zero sum game for farmers over the long term. The only real winners are the investors who put up the funds to build the plant for which there is a guaranteed demand for a product which is not competitive in a true free and open market.

And contrary to a carbon tax which everyone understands is a penalty for using carbon based fuels (which biofuels do still contribute too) a mandate provides no psychological incentive to reduce fuel usage.

Thanks for the kudos, not sure if I should be flattered or not?

The winners are the investors, why can't farmers also be investors, and therefore winners?

As for the psychological incentive, money talks, whether we call it a carbon tax, sin tax,or just plain more expensive, we all respond to higher prices. As of today, unsubsidized ethanol would be cheaper at the pump than straight gasoline. That won't disincentivize anyone from prolonging the reign of the infernal combustion engine.

I don't have the official numbers, but yeild of biodiesel is 40% ( oil content of canola) That is 20 pounds per bushel, which is 10.36 litres per bushel. So at $11 per bushel, and rack price on #1 diesel is 83.6 cents per litre, one bushel will yield $8.66 worth of biodiesel. Meal is worth $4.8 per bushel using $352 Dec 17 futures per metric tonne( using 60% of a bushel as meal) So there is (8.66+ 4.8 - 11 =) $2.46 to crush the canola get it to the rack and have profit. Soyoil is currently $35 per hundred weight, which is $7 for the oil. So if I did the math right, the biodiesel is worth more than the oil market? I assume canola oil trades at a premium to soyoil?