Susanne Retka Schill in the October 2007 issue of
Biodiesel Magazine wrote and outstanding article, "
Soybeans, Wheat and Corn compete for acres,"
that reviews 2007 biodiesel economics. It is helpful in
understanding the confusing bio-fuel industry and the challenges
biodiesel faces to stay competitive. It is an article well worth reading.
by Susanne Retka Schill
There’s a battle underway in the commodity sector—soybean, corn
and wheat markets are all signaling for more acres to be planted.
What’s unusual is that the wheat sector is the only one that should be
sending strong signals because of a second year of poor worldwide wheat
crops. In fact, wheat was setting new highs in early September, with
Chicago December wheat contracts trading well over $8 a bushel. In the
meantime, this year’s all-time record corn crop should have depressed
prices far more than it did; and last year’s record soybean crop and
healthy carryover forecast for this fall should have resulted in lower
prices. Despite those market fundamentals, both soybean and corn
markets—although not posting any records—remained strong the past
several months. “Last year it was clear we needed more corn acres and
the market signaled producers to do that,” says Darrel Good, University
of Illinois agricultural economist. Farmers responded by planting more
corn and less soybeans, planting 64.1 million acres of soybeans in
2007, down from the 75.5 million acres that produced last year’s record
soybean crop. “Now we’ll need more acres of everything, and how do you
do that?” Good says.
Read more at Biodiesel Magazine
