Ethanol's popularity wanes amid rising food prices
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22/05/2008
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USA Today (US)
Not long ago, the fledgling ethanol industry was the darling of investors, farmers, the federal government and a lot of Americans who liked the idea of turning corn into fuel. Suddenly, it doesn't have nearly as many friends. RISING PRICES: Is a bubble brewing in super-hot commodities markets? Rising global food prices and shortages have spurred calls in Congress to roll back the federal mandate to blend more ethanol and other biofuels with the gasoline supply. Critics say so much corn is being used for ethanol that there's less available for people and animals to eat, raising prices of everything from tortillas to meat. What's more, investors aren't seeing the returns they'd hoped for as once-record profits began to fall. "Consumers are starting to get restless, and Washington is starting to listen," said Morningstar analyst Ann Gilpin, who follows Decatur, Ill.-based Archer Daniels Midland (ADM), the No. 2 U.S. ethanol producer. The ethanol market would be severely limited if Congress rolled back the mandate for annual increases in the amount of biofuels added to the fuel supply