In his excellent book Plan B 2.0, agricultural economist and environmental visionary Lester Brown notes one potential downside to recent pushes for increased production of ethanol: the emergence of a battle in the marketplace between those who buy grain for food, and those who buy it for fuel. The winner of this battle isn't nearly so important as the losers: consumers who will end up paying higher prices for food. In the developed world, the blow won't be felt so hard; in the developing world, this could lead to starvation and political instability.

Brown addresses these concerns in an essay at Environmental News Network (ENN), and notes that the figures publicized by the US Department of Agriculture likely lowball the problem:

The U.S. Department of Agriculture (USDA) projects that distilleries will require only 60 million tons of corn from the 2008 harvest. But here at the Earth Policy Institute (EPI), we estimate that distilleries will need 139 million tons—more than twice as much. If the EPI estimate is at all close to the mark, the emerging competition between cars and people for grain will likely drive world grain prices to levels never seen before. The key questions are: How high will grain prices rise? When will the crunch come? And what will be the worldwide effect of rising food prices? …

The competition for grain between the world’s 800 million motorists who want to maintain their mobility and its 2 billion poorest people who are simply trying to survive is emerging as an epic issue. Soaring food prices could lead to urban food riots in scores of lower-income countries that rely on grain imports, such as Indonesia, Egypt, Algeria, Nigeria, and Mexico. The resulting political instability could in turn disrupt global economic progress, directly affecting all countries. It is not only food prices that are at stake, but trends in the Nikkei Index and the Dow Jones Industrials as well.

Brown believes the answer to this conundrum lies in 1) focusing on development of hybrid-electric automobiles, and 2) accelerating the process of producing cellulosic-based ethanol from agricultural residues and plants such as switchgrass. Politicians love ethanol, especially since it benefits politically powerful farm states. Brown's observations demonstrate the complexity of the move to greater ethanol use, and the dangers of looking too hard for a "silver bullet" to energy issues.

ENN: "World May Be Facing Highest Grain Prices in History"