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September 10, 2012

Before the U.S. biofuels boom took off in 2007, the food vs. fuel debate raged: can we afford to use

Before the U.S. biofuels boom took off in 2007, the food vs. fuel debate raged: can we afford to use corn for ethanol in a starving world? Five years later, farm bankers ask: can we afford not to? "Ethanol demand is the linchpin of the current pricing model that we have," said Michael Swanson, agricultural economist at Wells Fargo, the largest commercial bank lender to U.S. farmers. "It’s a completely different question whether it’s right or wrong." Amid the worst drought to hit the Midwest in a half century, corn prices have nearly doubled. Howls of protests have come from livestock feeders. The government has forecast food inflation to rise.  Read More

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