Archive for the ‘Land’ Category

“The endgame of biofuels is price parity between food BTUs and energy BTUs”

This quote comes from a comment beneath a story on Grist, Biodiesel in the dumps – original source (for me) of this article from the Atlanta Journal Constitution.

Biodistillers nationwide now realize that their industry’s survival depends on the vagaries of world trade. Cheaper soy and palm oil from Asia, Africa and Latin America increasingly replace domestically grown soy oil. Environmentally conscious Europe takes most of the U.S.-produced fuel.

Globalization of the American biodiesel industry, though, wouldn’t be possible without lucrative assistance — a $1-per-gallon tax break — from Washington. Alterra and other biodiesel producers receive the excise tax credit for each gallon of alternative fuel that is mixed with regular diesel.

And, since most of the biodiesel is shipped overseas, Congress essentially subsidizes the price European drivers pay for fuel.

“And we’re not really lessening our dependence on foreign fuel supplies,” said Mark Ash, an economist with the U.S. Department of Agriculture.

The blame falls mainly on the skyrocketing price of soybean oil used in 80 percent of the nation’s biodiesel production. Soy oil cost 22 cents per pound when Johnson broke ground in Plains. Wednesday, a pound cost 56.4 cents.

It takes 7.7 pounds of soy oil — or $4.34 — to produce a gallon of biodiesel, according to the Food and Agricultural Policy Research Institute. Add overhead and other processing costs (about 70 cents per gallon), federal and state taxes (54 cents) and subtract the dollar tax credit and a gallon of biodiesel could sell for $4.58 at the pump.

Regular diesel sold for $3.86 a gallon Wednesday in Atlanta.

“How’re you going to sell it at that price?” asked Davis Cosey, who owns an idled biodiesel factory in Perry. “The industry’s horrible. It’s in the ditch.”

Farmers aren’t doing producers any favors. In 2006, more than 75 million acres of soybeans were planted in the United States. Last year, only 64 million acres were planted, according to the USDA. Congress’ ethanol mandate — 37 billion gallons annually by 2022 — fueled the switch from beans to corn. In addition, rapidly developing China and India boosted soybean demand, and prices.

Interesting article (“Only federal subsidies keep the industry afloat” – one for the small-government-ers), if including odd lines like

“The American public, with rare exception, is 100 percent price-sensitive,” Johnson said. “They will not pay a penny more to go green.”

I kind of follow the argument – but 100% price sensitive? Dude, we’re all 100% price sensitive. It’s how sensitive we are that defines our markets (and in this “Johnson” is mistaken – of course we will pay more to go green. We just aren’t stupid enough to call something as daft as crop-grown biofuels shipped half-way ’round the bloody world and back “green”).

So US biodiesel manufacturers are importing soy and palm oil (the latter a truly horrible product, vis, the environment) in order to make biodiesel that is shipped to Europe because the market here is too small – meanwhile only surviving thanks to subsidies (meaning your tax dollars are subsidising European motorists).

Stop me when you can’t take the stupidity any longer.

So this would be where the comment came from. Personally I don’t fancy their chances, however much I agree with their sentiment. For a start food BTUs aren’t at all close to being adequately priced – but, then, neither are things like biofuels, oil shale, etc. Maybe one day. One day when we stop IV-subsidies to wasteful industries and make agriculture compete like everyone else.


Land ahoy: buyers spy relief in fringe release

Or at least, that’s what I’m told (with apologies to Johnny Cash).

Sydney home buyers should get some relief from high housing prices, following the State Government’s release of more than 17,000 new vacant lots, to go on sale over the next 18 months.

Premier Morris Iemma said yesterday the land will add to the 33,000 Landcom housing lots already earmarked for new housing developments in the city’s south-west and north-west fringes.

The home sites are near Mount Annan and Campbelltown in the south-west and The Ponds in the north-west as well as Oran Park, near Camden and Stanhope near Blacktown.

Mr Iemma warned increases in interest rates were the major deterrent to people investing in the new home developments.

This is some definition of fringe. Mount Annan is way out:

Mt Annan

Oran Park is known as the home of a raceway, put there because of its (then) isolation – but you’ll be right on the doorstep of those supertruck races, now)

Oran Park

While Stanhope Gardens (damn newspapers) isn’t so much near Blacktown as Baulkham Hills – i.e. North-East-ish, where few trains go.

Stanhope Gardens

In all of these cases, you will need a car. From Mount Annan you drive to Campbelltown and settle into a 90-minute-odd train ride into the city (if that’s where you work – more on that in a second), although my Uncle (who lives near Picton, just south of there) has more than a few stories of that plan coming undone. Same with Oran Park, and from Stanhope Gardens you probably would drive to Blacktown to spend only about 40 minutes on the train into the city.

This assumes you work in the city. Blacktown and Parramatta are doing a good turn becoming serious commercial hubs within the greater City of Sydney. If your job is there, you might be okay, although you’ll still face an impressive commute, considering it’s to an outer urban hub. I can’t comment further about not being involved in or through Sydney city itself, because I’ll sound like an asshole.

If you’re one of those people suffering from, or getting all worked up about (or both) house prices in the Inner Suburbs, this will do nothing at all for you – you probably have never been to Mount Annan, for all I know (nice parks and gardens out there, though. I recommend it). I doubt you’d manage at all well, living there, if you even would, and I can’t see it doing much for house prices in Sydenham or Marrickville, if you don’t.

Bear in mind also the shortfall in NSW is scheduled to be in the 95,000 mark – an extra 17,000 lots makes a dent, but not much of one. Moreover it applies a weak balm to the central irritation – clinging to the city of Sydney, when there are many areas in the state (and the country) where you quality of life would arguably be better, as a family. Certainly better than some suburban island with barely a municipal bus network. A look at petrol prices and a few peak-hours practiced on the highway will probably deter most people.

I just don’t see how “here, strand yourselves in this community, own your own home and shut up” counts as policy. Unless the state government (currently borrowing a whopping AUD10.4bn to add to its already AUD25bn of debt) has some big plans to deal with the infrastructure required to actually service and include these communities, this move is just offering potential owners the one thing we insist they want – ownership – and hoping urban sprawl will end up working itself out, in the end.