2008 October 12 Sunday
Scientist Sees Resource Constrained Future

Robert Criss says the big problem is exponential population growth.

Oct. 7, 2008 -- It's a 500-pound gorilla that Robert Criss, Ph.D., professor of earth and planetary sciences in Arts & Sciences at Washington University in St. Louis, sees standing on the speaker's dais at political rallies, debates and campaigns. Its name is population growth.

"Population growth is driving all of our resource problems, including water and energy. The three are intertwined," Criss says. "The United States has over 305 million people of the 6.7 billion on the planet. We are dividing a finite resource pie among a growing number of people on Earth. We cannot expect to sustain exponential population growth matched by increased per capita use of water and energy. It's troubling. But politicians and religious leaders totally ignore the topic."

Some argue that since disaster was predicted in the past and did not happen that pessimistic views of resource depletion should be dismissed. I'm reminded of the boy that cried wolf. The wolf eventually came.

A substantial portion of the American population are using non-renewable sources of ground water.

The United States is experiencing rapid population growth — at a rate higher than almost any other developed country — along with increased food production, Criss says. In many areas, especially the West, the practice of "mining" ground water to irrigate arid or semiarid land, which won't work in the long run, is becoming commonplace. "Energy and water use are intimately related," he says. "As water tables decline, you have to use more energy to lift the water out of the ground. That's what a pump has to do in places like Arizona where water levels have dropped many hundreds of feet. More people, more water use, more food, more energy. It's not sustainable."

Criss says approximately 150 million Americans use ground water, most of which is nonrenewable.

Market pricing of water can keep demand and supply in balance. But as water tables decline in Arizona will the price of water get so high as to make people migrate out of the state?

Some people do not see a resource-constrained future. They point to the big decline in oil prices as a sign that oil shortages are a thing of the past. But they aren't looking closely at the cause of the declining oil prices: US oil imports fell almost 10% in a single month. Fast and big dips in demand will lower prices.

The monthly trade report contains data on the price of imported oil. Friday's report said the average price per barrel in August fell to $119.99 from $124.66. Even with a price drop, U.S. crude import volumes eased to 308.38 million barrels from 342.02 million, amid a faltering economy.

Recessions and financial crises aren't what I want to count on to lower oil prices.

If we are headed into a economic Depression (and I have no idea) then oil demand will drop far enough that lower prices can be sustained for a while. But if we are (hopefully) not headed into a Depression then I would expect this oil price dip to be temporary. Economic growth in Asia will eventually boost Asian demand by more than enough to displace lost US demand. If one wants to be optimistic about future oil supplies one either has to point to large discoveries (and by large I mean each year discovering more than we used that year) or signs of a rapid scaling up of oil replacements.

Nanotechnology will eventually change the resource scarcity picture. In particular, energy limitations are solvable in the longer term. With nanotech assemblers photovoltaics will some day be very cheap and wind will become cheaper as well. With a lot of energy lots of materials become substitutable for each other. But I'm not expecting that sort of drop in fabrication costs in the next 10 years.

By Randall Parker    2008 October 12 06:08 PM   Entry Permalink | Comments ( 22 )
2008 January 19 Saturday
Biofuels Use Pushes Up Vegetable Oil Costs

A New York Times article by Keith Bradsher entitled "A New, Global Oil Quandary: Costly Fuel Means Costly Calories" draws attention to the growing direct competition between using land to create food and to create energy. This is not new news for regular FuturePundit readers. But you can now discuss this as a legitimate mainstream topic, which is nice. Biodiesel causes food riots.

This is the other oil shock. From India to Indiana, shortages and soaring prices for palm oil, soybean oil and many other types of vegetable oils are the latest, most striking example of a developing global problem: costly food.

The food price index of the Food and Agriculture Organization of the United Nations, based on export prices for 60 internationally traded foodstuffs, climbed 37 percent last year. That was on top of a 14 percent increase in 2006, and the trend has accelerated this winter.

In some poor countries, desperation is taking hold. Just in the last week, protests have erupted in Pakistan over wheat shortages, and in Indonesia over soybean shortages. Egypt has banned rice exports to keep food at home, and China has put price controls on cooking oil, grain, meat, milk and eggs.

According to the F.A.O., food riots have erupted in recent months in Guinea, Mauritania, Mexico, Morocco, Senegal, Uzbekistan and Yemen.

China's industrialization is putting the demand for more food by the Chinese middle class into direct competition with the demand for biomass for energy and for food for people in much poorer countries.

Half the demand growth for vegetable oils comes from use for biofuels.

Biofuels accounted for almost half the increase in worldwide demand for vegetable oils last year, and represented 7 percent of total consumption of the oils, according to Oil World, a forecasting service in Hamburg, Germany.

Also see Stuart Staniford's posts on The Oil Drum entitled Fermenting the Food Supply which I covered in my own post Will Biofuels Demand Cause Mass Starvation? aand his follow-up post Death Rates and Food Prices. Staniford reports that rural poor in undeveloped countries grow a lot of unexportable crops and are pretty isolated from the world food market. But the much more rapidly growing ranks of urban poor appear to be far more vulnerable to world food price rises. My reaction: We need a massive international effort to lower fertility rates in the very poor high fertility rate countries. We also need massive build-ups of nuclear and wind power to reduce the demand for agricultural products to create energy.

So how much can this demand growth push up prices? Quite a lot it turns out.

Palm oil commodity prices now sit above $1,000 per tonne on the strength of rising demand from increasingly prosperous Asian consumers. A year ago the price was $600.

Back in the good old days of 2001 when the world seemed so ripe with possibility palm oil leaped from $220 per tonne to $290 per tonne in just 3 weeks. But now it is almost 5 times more expensive with a recent price of $1040 per tonne.

Currently, the indicative price for refined palmolein is $320 a tonne and for crude palm oil $290 a tonne, both free-on-board Malaysia (and both up $70 a tonne in last three weeks)

What happens when oil production peaks (it might have already) and starts declining? The higher the price of petroleum oil goes up the higher vegetable will go up along with. Rises in fossil fuels diesel prices cause rises in the price that companies will pay for vegetable oil to use to create biodiesel. It is as simple as that.

Malaysia has seen a lot of panic buying of palm oil. But is this really panic buying or a rational response to expected future price rises? Buy sooner when it is cheaper.

The Malaysian Government has been forced to make an emergency palm oil injection into supermarkets and food stores across the nation to break a wave of panic-buying after prices of cooking oil soared.

The crisis, which has emptied shops completely of cooking oil, has already prompted palm-oil rationing in a country that is one of the world’s largest producers of the highly sought-after commodity.

I am expecting food exports to follow a pattern similar to oil exports. As big exporting countries start to find internal demand is growing rapidly the internal pressures will build to stop exports. Bans on exports will create the conditions for market prices for food and oil which are lower in many producers than on the world market.

By Randall Parker    2008 January 19 06:00 PM   Entry Permalink | Comments ( 8 )
2007 October 21 Sunday
US West Facing Long Drought?

The US West is in a drought. Lake Mead is only half full. Also, water is getting pumped up from deep aquifers much more rapidly than rain replaces it even when not in a drought. Yet the West's population is growing rapidly and water demand looks set to rise much higher. An article by Jon Gertner in the New York Times Magazine reports on the West's growing water problem.

But recent studies of tree rings, in which academics drill core samples from the oldest Ponderosa pines or Douglas firs they can find in order to determine moisture levels hundreds of years ago, indicate that the dry times of the 1950s were mild and brief compared with other historical droughts. The latest research effort, published in the journal Geophysical Research Letters in late May, identified the existence of an epochal Southwestern megadrought that, if it recurred, would prove calamitous.

When Binney and I met at Dillon Reservoir, he brought graphs of Colorado River flows that go back nearly a thousand years. “There was this one in the 1150s,” he said, tracing a jagged line downward with his finger. “They think that’s when the Anasazi Indians were forced out. We see drought cycles here that can go up to 60 years of below-average precipitation.” What that would mean today, he said, is that states would have to make a sudden choice between agriculture and people, which would lead to bruising political debates and an unavoidable blow to the former. Binney says that as much as he believes that some farmers’ water is ultimately destined for the cities anyway, a big jolt like this would be tragic. “You hope you never get to that point,” he told me, “where you force those kinds of discussions, because they will change for hundreds of years the way that people live in the Western U.S. If you have to switch off agriculture, it’s not like you can get back into it readily. It took decades for the agricultural industry to establish itself. It may never come back.”

Agriculture uses most of the water. Plus, the agricultural water mostly evaporates. Whereas much of the home use goes out in sewers where it can be recycled. Cut out the East Coast lawns and Western houses could recycle almost all their water usage. But a long drought would drive up food prices and push agriculture toward wetter areas.

Since long droughts are a natural occurrence one will happen sooner or later. But if we heat up the planet (which I still doubt will happen since we are running out of fossil fuels) then the West could get hit by a mega mega drought. We are talking Turbo Drought.

An even darker possibility is that a Western drought caused by climatic variation and a drought caused by global warming could arrive at the same time. Or perhaps they already have.

An extreme drought would cut off electricity from hydroelectric dams of course. But conventional electric power plants also use water. So electric power generation could be cut even more deeply. A drought alongside an ocean at least leaves the potential for desalination. If you can afford to build nuclear power plants near oceans you can use the energy to desalinate ocean water. But Colorado is far from any ocean.

Agriculture would be much harder hit by a big drought. What little water the farmers could get would be worth more sold for residential use. So I would expect farmers to give up farming while residences would convert to heavy recycling of water.

Speaking as someone who lives in the West I see my local utility bill as a disincentive to efficient water usage. First off, the water doesn't cost all that much. Second, the water costs the same whether used in ways that go back down the sewer pipe or used to water lawns. It annoys me to water a lawn and pay more not just for the water but also for sewer service.

But if the goal is to reduce evaporative loss of water then water should cost much more. But here's a twist: the sewer flow should be metered and water that returns out the sewer should reduce the cost of the water. In other words, you should be charged less for water that you return to the sewer system than for water that you use on lawns and gardens.

Cheap solar power (when it finally arrives) will some day provide coastal communities with power to run desalination plants. Solar works well for this purpose because the bulk of the water conversion could be done during daylight hours for use all day long. The purified water could be pumped during sunny days to reservoirs and water towers and then used at night and on overcast days.

Coastal desalinization will reduce the need for river water by coastal communities. That will free up more of the Colorado River water for landlocked states. In fact, landlocked states will probably some day buy water rights from California and California can use the money to fund desalinization operations. So coastal desal will help inland communities.

By Randall Parker    2007 October 21 08:35 PM   Entry Permalink | Comments ( 8 )
Site Traffic Info