CBO report, ethanol contributed 15% to food price increase (2007-2008) , energy? 22% or 36%

[JohnWxy]

depending on the index you use. CBO indicates the PPI for intermediate enrgy products is more likely a better measure of costs faced by rtail food sector gives you the 36% contribution for energy.


http://biofuelsandclimate.files.wordpress.com/2009/04/cbo-report-on-ethanol.pdf#page=20&zoom=100%,0,400


The impact on food prices resulting from hikes in the price of corn related to ethanol production was smaller
than the effect of higher prices for energy, which contribute to the CPI-U for food directly through higher costs
for transportation and electricity and indirectly through higher costs for producing commodities. As an example,
the CPI-U for energy rose by 16 percent between April 2007 and April 2008.36 Given the contributions that the
prices of transportation, fuel, and electricity make to the CPI-U for food, the increase in the CPI-U for energy
implies a direct boost in the CPI-U for food of 1.1 percentage points (22 percent) of the 5.1 percent increase in
food prices during the April 2007–April 2008 period. Alternatively, the producer price index for intermediate
energy products could be used as a measure (and may better reflect the costs that the retail food sector faces for
energy). Using that measure leads to an increase in energy prices between April 2007 and April 2008 of 25 percent,
which implies a direct increase in the CPI-U for food of 1.8 percentage points (36 percent) of the increase in food
prices during that period.37


When this was reported on by the Hill's, by Jim Snyder, all he reported was the CBO report said ethanol contributed to food pricers but he didn't mention the report said energy costs contributed more to food price increase than ethanol. that's what you call lieing by omission.

What the CBO report didn't go into was that since ethanol reduced demand for gasoline by supplying 6.3% of the transportation fuel needs ethanol actually reduced the price of gas about 15% (depending on whose measure of elasticity of demand for gasoline you use). and so ethanol actually reduced the impact energy prices did have on food prices.