The US Corn Belt and the summer chill

Guest essay by David Archibald

A correspondent in the Corn Belt emailed on 10th August:

“Here in north central Illinois at exit 56 on I-80, most of the corn was planted by May 15.

The GDD totals since May 15 at Moline, Illinois.

  • May 15-31      + 1.7 GDD >normal.
  • June 1-30     – 32.7 GDD < normal.
  • July 1-31      – 94.5 GDD < normal.
  • August 1-9    – 33.9 GDD < normal.

Total since May 15 = 1695.0 GDD = -159.4 < normal, or about 8 normal days in early September. Corn that has a 2,500 GDD rating needs about 40 days yet. Most of the corn planted in NC Illinois is in the 2,450 GDD to 2,700 GDD maturity area.

The area of greatest risk is in IA north of Route 30, MN, WI and the Dakotas.”

clip_image001

Figure 1: Corn Futures and Production Forecast from the Wall Street Journal

The corn market doesn’t see a problem with corn prices off 30%-odd from where they started the year, as shown in Figure 1 at right.

To illustrate the problem in parts of the Corn Belt, Figure 2 shows the average Growing Degree Days (GDD) experienced in Northwest Indiana, fairly close to the center of the Corn Belt:

clip_image003

Figure 2: Average Weekly GDD for Corn in Northwest Indiana

From where we are at the time of the incoming correspondence, marked on the graph at 10th August, the heat received by the corn crop starts falling away.

Staying in Northwest Indiana, if we assume that the crop there was also 159 GDD below a normal season, Figure 3 illustrates the effect of on achieving the necessary 2500 GDD for crop maturity:

clip_image005

Figure 3: Northwest Indiana 2013 Corn Crop

The upper red line shows the cumulative GDD for a crop planted on 15th May if the season had been normal from that date. Under that case, 2,500 GDD would be achieved by 26th September well before the first frost date for the area. The season has been colder than average with GDD for July 15 per cent below normal. The green line shows the fate of the crop if the season reverts to normality from 10th August. Under that case, 2,500 GDD is reached by 17th October, very close to the first Fall frost date. The lower dark blue line shows the effect of the season being 10% cooler from here.

While we cheer on the Arctic sea ice extent, there are farmers in the northern half of the Corn Belt who are now concerned about how their crop will finish.

UPDATE: Lows this morning from Dr. Ryan Maue – Anthony

2Mlows_cornbelt

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Any loss in the northern corn belt is possibly going to be offset by huge bumper crops in the Mid-Atlantic and south and the southern half of the corm belt. The corn is 10 feet tall in some places from all the rain they have had and the worry now is that they are hoping they don’t get winds that knock the heavy stalks over.

@njsnowfan

HAZARDOUS WEATHER OUTLOOK
NATIONAL WEATHER SERVICE DULUTH MN
314 PM CDT TUE AUG 13 2013
314 PM CDT TUE AUG 13 2013
THIS HAZARDOUS WEATHER OUTLOOK IS FOR NORTHEAST MINNESOTA AND
NORTHWEST WISCONSIN.
.DAY ONE…THIS AFTERNOON AND TONIGHT
SOME FROST IS POSSIBLE OVER PORTIONS OF FAR NORTHERN
MINNESOTA…INCLUDING THE BORDER REGION…IRON RANGE…AND
ARROWHEAD. FROST IS ALSO POSSIBLE OVER PARTS OF NORTHWEST
WISCONSIN…MAINLY AROUND
HAYWARD…WINTER…DRUMMOND…GLIDDEN…MERCER AND PARK FALLS.
PATCHY DENSE FOG WILL ALSO BE POSSIBLE TONIGHT.
.DAYS TWO THROUGH SEVEN…WEDNESDAY THROUGH MONDAY
MOST OF THE NORTHLAND WILL REMAIN DRY THROUGH THE WEEKEND…WITH A
CHANCE FOR THUNDERSTORMS RETURNING EARLY NEXT WEEK.
.SPOTTER INFORMATION STATEMENT…
SKYWARN SPOTTER ACTIVATION WILL NOT BE NEEDED THIS AFTERNOON OR
TONIGHT.
http://forecast.weather.gov/showsigwx.php?warnzone=MNZ018&warncounty=MNC061&firewxzone=MNZ018&local_place1=&product1=Hazardous+Weather+Outlook#.UgsMg9bD_Dc
This kind of news can run chills down a farmers back. For Mid August.

cloa5132013

Should have included a description of Growing Degree Days (GDD). Unless you are an American horticulturist, you’d have no idea what this article is about.
http://ohioline.osu.edu/agf-fact/0101.html

John from the EU

And then they say warming is bad…

tom

Looking warmer than normal upper Midwest next 2-3wks. after this brief cool spell. Good heat and humidity to get that crop up and over the finish line.

I told you to starts packing your bag at >40
it is just that nobody is listening to me
http://blogs.24.com/henryp/2013/04/29/the-climate-is-changing/

Katio1505

Thanks for the explanation, Michael

TimB

Did we reach “peak Corn?”

Luther Wu

TimB says:
August 13, 2013 at 10:32 pm
Did we reach “peak Corn?”
__________________________
OK, that’s it. you get the Thread Gold Star.

LucVC

I fear it is called weather. In Ukraine & Russia they expect a record harvest of almost anything they planted as they had a wet & sunny summer.

Brazil and China wheat crop damaged by frost, but fewer frosts in Australia.
It’s weather, unless persuasive data says otherwise.

brian

LucVC, I agree with you, it is just weather. The problem is the overall trend, all of these happening together backs up Skeptical claims that not only has the earth temp gone stasis for 17 years but you can almost see the hint of a slight decline since 2005. Now before someone attacks me, yes that could simply be noise and 5 – 10 years from now, that decline will be smoothed out. That said, there is alot of info, pointing to the direction that the earth is NO longer warming and is stasis.
The warmist, have always pointed to individual events, not too point them out, but to build bulk evidence in multiple data sets that support their theory. Even though individual events are just weather, they did have point, when mother nature was cooperating, that when multiple different data sets all point to one conclusion, they might be on to something.
Those conclusions say two things, the earth is no longer warming, at least temporarily, and warming is better than the alternative.

Greg

Was corn grown this far north in the 60s and 70s or is this just a response to the ethanol boom?

strike

Total since May 15 = 1695.0 GDD = -159.4 < normal, or about 8 normal days in early September. Corn that has a 2,500 GDD rating needs about 40 days yet. Most of the corn planted in NC Illinois is in the 2,450 GDD to 2,700 GDD maturity area.
Speaking of September, meaning August?

Bloke down the pub

Whether the corn crop is too big in the South, or gets wiped out by frost in the North, readers here won’t be suprised by who the msm blames for it.

Charles Tossy

More carbon dioxide in the air means faster growing plants. On the other hand, if it is raining all the time, those twenty ton tractors can’t be taken out into the fields.

Dr. John M. Ware

I grew up in Indiana and as a boy spent July in Wisconsin, about halfway up on the Lake Michigan shore. This was in the late 1940s to early 1960s. Corn was planted heavily in both Indiana (not far from the Michigan line) and Wisconsin; the old saying was that the farmer hoped it would be “knee high by the fourth of July.” There were other crops also, of course; but the corn was what we laypeople watched the most. Much depended on the spring–when could the crops be sown? As I recall, in northern and central Wisconsin there was more spring than winter wheat, but that’s long ago, and I was not the most informed observer. Spring could stay fairly cold in that part of the country. I remember a light dusting of snow on my father’s birthday, June 21, in Huntington County, Indiana one year.
Very interesting article, as was the link to the Ohio explanation of GDD.

Alan the Brit

Me, it’s just weather as usual. I am convinced the Sun governs our climate through it’s activity levels. No idea about specifics, but I just know it does. William Herschel won bets on the price of corn/wheat in Britain by counting Sunspots, the more there were, the cheaper the corn/wheat, the fewer there were, the higher the price! Who says empirical evidence isn’t any good over puter models? AtB

Michael said @ August 13, 2013 at 10:08 pm

Should have included a description of Growing Degree Days (GDD). Unless you are an American horticulturist, you’d have no idea what this article is about.

The concept of Growing Degree Days is not unique to American horticulturists and has been discussed here before.
Even the wiki-bloody-pedia has an article:
http://en.wikipedia.org/wiki/Growing_degrees

Predicted corn yields are down a little from average. Development is a little behind average.
http://www.agweb.com/blog/Farmland_Forecast_148/
I, too, would have appreciated a definition of GDD in the article. It would have made the article clearer without the reader having to stop and look up the abbreviation.

Michael says: August 13, 2013 at 10:08 pm “Should have included a description of Growing Degree Days (GDD). Unless you are an American horticulturist, …”
Ixodes ticks, blacklegged deer ticks, vector for burgeoning Borrelia burgdorferi is exquisitely sensitive to GDD, synchronizing stadial activity by diapause. Because Ixodes aren’t tied to photosynthesis and, thus, daylight, a measure of ‘growing degree hours’ is useful.
The “can’t post this comment” glitch is tedious. Any work arounds?

Reading through the Wikipedia GDD article, I noticed Weather Derivatives.

Gary Pearse

So if the crop is 15% less, this probably means biogasoline and biodiesel will still be okay thankfully.(sarc off)

Rhoda R

Crosspatch: I notice that the corn is very high this year, but is it producing more grain? My tomatoes and cucks are all over the place but they haven’t set much fruit – lack of daylight is my guess or possibly fewer bees due to the wet.

PeterB in Indianapolis

This morning in Whiteland Indiana (Central Indiana, about 20 miles south of Indy), it was a balmy 48F at 6:15 this morning, and the predicted high for today is only 72F. The cool weather (below 80 for the highs with night-time lows in the upper 40s to low 50s) is supposed to persist for about 3 more days. After that, they are projecting a 2-week period (so far) with highs in the low to mid 80s and lows in the mid 60s, which should help the corn crop.
Last year by this date, Central Indiana had close to 40 days with temperatures > 90F for the high, with about 10 over 100F. This year, we have had FOUR (that’s right 4) days with temperatures > 90F for the high, with none over 100F. I know this is just “weather”, but it has been SIGNIFICANTLY cooler this entire year in Central Indiana than it was in 2012.
However, the corn has had 0 heat stress, and is actually looking quite good. If we get a decent number of 80+ degree days and a reasonable amount of rain between now and October 1st, the corn here in Central Indiana is going to be a “bumper crop”.

A GMO is short corn that does not waste energy on un-needed height greenery.

Richard M

It was in the upper 40s F this morning in southern Minnesota. However, it is supposed to warm up this weekend with slightly above normal temperatures. Farming corn was strong in this area back in the 1950s and 1960s as well. Personally, I don’t see a big problem at the moment. The biggest fear is an early hard freeze which would halt the growth.

Gene Selkov

Doug Huffman says:
> A GMO is short corn that does not waste energy on un-needed height greenery.
Coz it gets enough from the soil, so can afford to have smaller leaf area. Which gives an even better punch to one of my friends’ maxim that the modern agriculture can be thought of as the convertion of petroleum products into food using sunlight and soil as catalysts. The author of this maxim is himself from central Illinois, where they have good intution about energy conversion in general.

Bill Illis

In an historical context, corn prices today are lower than they have been in the past. The recent ethanol mandates have bumped up prices lately. Wheat is not much that much different than it was in terms of inflation-adjusted prices. Corn and Wheat adjusted for CPI back to 1784 here.
http://s22.postimg.org/ixdf5un7l/Real_Corn_Wheat_Prices_Jul2013.png
In nominal prices, hard to tell what’s going on.
http://s23.postimg.org/54qoxvq6z/Nominal_Corn_Wheat_Prices_Jul2013.png
Drought and/or rain and/or climate does not appear to be the big driver of these prices. It is shocks like Wars especially, or a Soviet collective farm failure in 1973 or an ethanol mandate in 2004.

Outrageous Ampersand

I have to confess I don’t know much about corn farming.
However, it seems to me that a certain amount of fuel ethanol still has to be produced each year by law, and much of that come from corn. Thus, the amount of corn going into ethanol production won’t budge, regardless of how much corn is actually grown.
So, if the corn harvest is smaller and the ethanol guys still buy up the required amount, that just leaves less corn for food and feed.

Rhoda R said @ August 14, 2013 at 5:10 am

Crosspatch: I notice that the corn is very high this year, but is it producing more grain? My tomatoes and cucks are all over the place but they haven’t set much fruit – lack of daylight is my guess or possibly fewer bees due to the wet.

Fruitset in your cukes is by insect pollination, but tomatoes are self-fertile and the pollen falls from the male part of the flower onto the ovaries. I shake the stalks of my tomato plants mid-morning; commercially growers spray tom-set onto their plants.
Most likely cause of your poor fruit set is depressed temperatures and excess humidity. If the plants are growing luxuriantly, they will be reluctant to set fruit. Try slicing through a few roots on a couple of plants and see how they respond to a threat to their survival.

Bill Illis says August 14, 2013 at 6:00 am

In nominal prices, hard to tell what’s going on.
http://s23.postimg.org/54qoxvq6z/Nominal_Corn_Wheat_Prices_Jul2013.png
Drought and/or rain and/or climate does not appear to be the big driver of these prices.

‘Free money’ (zero or very low interest cost) to traders (incl commodities traders) who find this an easy area to ‘work’; pls send my thanks (/sarc) to Ben Bernanke for that (the ‘QE’ policy of the Fed) …
.

David Archibald

Gene Selkov says:
August 14, 2013 at 5:54 am
It is said that half the world’s protein comes from the conversion of fossil fuels to nitrogenous fertiliser and thence to plant protein. A Yara fertilisers presentation I read recently showed the results of European wheat yield trial which went from 2 tonnes/hectare without any nitrogenous fertiliser to 8 tonnes/hectare fully fertilised. So locally three quarters of protein consumed comes from fossil fuels. But one day the fossil fuels will run out and certainly become very expensive in the lifetimes of most of the readers of this blog. The University of Minnesota had been experimenting with conversion of wind to ammonia. That work seems to have gone quiet. The good news is that might be viable at $200/bbl on my figuring. Cheap nuclear power will food costs down. Without it, a lot of the world’s population won’t be able to afford food.

So, if the corn harvest is smaller and the ethanol guys still buy up the required amount, that just leaves less corn for food and feed.
==============
I’m told by a mid-west agi research scientist, who also believes agw is a crock, that corn ethanol is good for the farmers. while ethanol production does remove the sugars from the corn, the left-over by-product still makes good hog feed. in effect the price to the farmer is improved because the corn can be sold twice. he wasn’t very concerned about shortages. the better return to the farmer means they will plant more. so maybe corn ethanol production is not quite as simple a problem as it might first appear.

Richard S Courtney

David Archibald:
In your post at August 14, 2013 at 6:50 am you say

But one day the fossil fuels will run out and certainly become very expensive in the lifetimes of most of the readers of this blog.

OK, but I have a question.
How long after pigs grow wings and fly will that be?
Richard

But one day the fossil fuels will run out and certainly become very expensive in the lifetimes of most of the readers of this blog.
==========
that is largely an illusion of inflation. 60 years ago gasoline was $0.25 a gallon. Today it is $4 a gallon. However, history shows that every 70 years or so the purchasing power of $1 shrinks to $0.01. So in terms of purchasing power, the cost of gasoline has remain relatively constant for the past 100 years. Which means that oil cannot be “running out”, otherwise it would be reflected in the market price.
http://inflationdata.com/Inflation/images/charts/Oil/Gasoline_inflation_chart.htm

Bill Illis says August 14, 2013 at 6:00 am
In an historical context, corn prices today are lower than they have been in the past. The recent ethanol mandates have bumped up prices lately. Wheat is not much that much different than it was in terms of inflation-adjusted prices. Corn and Wheat adjusted for CPI back to 1784 here.
http://s22.postimg.org/ixdf5un7l/Real_Corn_Wheat_Prices_Jul2013.png

Which “CPI”? There appear to be several CPI indices including CPI for Urban Wage Earners and Clerical Workers (CPI-W), CPI for All Urban Consumers (CPI-U), CPI for the Elderly (CPI-E) and Core CPI. Src – wiki
Additionally, the CPI excludes taxes, such as income and Social Security taxes, and energy and food price changes which are excluded from the Federal Reserve’s calculation of core inflation.
Core inflation – http://en.wikipedia.org/wiki/Core_inflation – “ The preferred measure by the Federal Reserve of core inflation in the United States is the change in the core Personal consumption expenditures price index (PCE). This index is based on a dynamic consumption basket. Economic variables adjusted by this price deflator are expressed in chained dollars, rather than the alternative constant-dollar measure based on a fixed goods’ basket.
Back to the graphics:

In nominal prices, hard to tell what’s going on.
http://s23.postimg.org/54qoxvq6z/Nominal_Corn_Wheat_Prices_Jul2013.png

Perhaps this last chart *is* the better indicator?
And, an alternate, more open-loop take on inflation from a world-wide perspective and the impact seen by other countries vis-a-vis food-price inflation:
http://www.zerohedge.com/article/tale-two-inflations-why-us-cpi-flawed-and-why-bernanke-will-maintain-zirp-revolutions-rage
.

Oops, mods – must be a link thingy that gets some comments flagged for moderation!

beng

***
PeterB in Indianapolis says:
August 14, 2013 at 5:22 am
Last year by this date, Central Indiana had close to 40 days with temperatures > 90F for the high, with about 10 over 100F. This year, we have had FOUR (that’s right 4) days with temperatures > 90F for the high, with none over 100F.
***
Similar here in the mid-Appalachians. A mere three days reaching 90F or more — 90,90, and 91F. 50F (cold!) this morning w/breezy winds — alot cooler if it had been calm. Evaporation from well-watered forests & afternoon clouds kept temps down during the so-called heat-wave.

David Archibald

Richard S Courtney says:
August 14, 2013 at 6:59 am
The UK is going to run out sooner than most. It has had two Hubbert peaks – coal in 1913 and oil in 1999. You have converted your largest power station to burning woodchips at 7.5 mtpa from the US. You are a worshipper of the Gods of the Market who promise winged pigs and abundance for all. Ok, there could be abundance for all but we are not going to get there on our current trajectory. The UK is importing woodchips to make electric power. What would happen to the price of UK-grown food if you used woodchips to make your nitrogenous fertiliser?

The UK is sitting on vast resources of shale gas.Peak oil is not an issue there.

David Archibald said @ August 14, 2013 at 6:50 am

It is said that half the world’s protein comes from the conversion of fossil fuels to nitrogenous fertiliser and thence to plant protein. A Yara fertilisers presentation I read recently showed the results of European wheat yield trial which went from 2 tonnes/hectare without any nitrogenous fertiliser to 8 tonnes/hectare fully fertilised.

David, that might apply to a specially selected field, but doesn’t make any sense in what might laughingly be called The Real World. I can recall two papers regarding fertiliser response of cereals in Europe published during the 1980s. Both papers concluded that over a 30 year period the yield increase from artificial fertilisers was ~15% and insufficient to cover the cost of the fertiliser.
The response of wheat to artificial N is complex. Here’s a link to a WA Dept of Ag page:
http://www.agric.wa.gov.au/PC_92452.html
In Australia at least, most bag N is applied to control protein content rather than influence yield. Yield has rather more to do with soil moisture than applied fertilisers.
It was interesting to hear organic and conventional farmers comparing experiences at a conference I attended in Adelaide in the early 1980s. Cereal growers relying heavily on bag fertiliser had more serious disease problems than those relying on rotation between pasture and sheep with cereals.

Rud Istvan

GDD is one of several important factors. Another is when the crop was planted. On my southwest Wisconsin dairy farm, everything this year was about two weeks later than normal due to wet and cold–even the wild morel harvest was two weeks late. We had to push until well after midnight for over a week end of May to get the fields finally planted. Another is heat stress (over 95F in dry conditions). Another is moisture during anthesis, which by July means rain. We have been OK on those two. Current outlook is for better than 170 bu/acre, about normal for our area, unless we get an early frost.. Last year because of dryness we barely managed 110. It’s called farming, and even if you have irrigation (we don’t) is always weather dependent.

@ Richard S Courtney
Superior, sarcastic and ignorant as always – opinion unencumbered by any real information.
@ David Archibald
Start watching for those flying pigs . . .
Worldwide discovery of oil peaked in 1964 and has followed a steady decline since. The world’s leading petroleum geologists agree that more than 95 percent of all recoverable oil has now been found. About 2.5 trillion barrels of conventional oil was in the ground when we started drilling the first well. Continental US oil production peaked in the 1970’s; Alaska’s peaked around 1988, and by 2005, 90% of its oil had been extracted.
At our current rate of over 30 billion barrels a year, approximately half of the world’s total reserve has been consumed, which means the world is nearing its peak production plateau – estimated to occur between 2014 and 2025. More generous estimates place world peak oil production at around 2050 or later.
90% of US transportation relies on oil. Our abundant food supply is also oil-based. Since the 1940s, agriculture has dramatically increased its productivity, due largely to the use of chemical pesticides, fertilizers, and increased mechanization. This oil-driven boom in food productivity is called the Green Revolution. The increase in food production has allowed world population to grow dramatically over the last 50 years. Pesticides rely upon oil as a critical ingredient, and fertilizers require natural gas. Farm machinery also requires oil.
From Wiki leaks it has emerged that Senior Saudi energy officials have privately warned US and European counterparts that OPEC would have an “extremely difficult time” meeting demand and that the reserves of Saudi have been overstated by as much as 40%. A Saudi Aramaco official has been quoted, “Even an attempt to get up to 12 million barrels per day would wreak havoc within a decade by causing damage to the oil fields.”
Exxon Mobil Corporation, one of the world’s largest publicly owned petroleum companies, is the most forthright of the major oil companies having had the courage and honesty to quietly publish the declining discovery trend, based on sound industry data with reserve revisions properly backdated. Furthermore, the company is running page-size advertisements in European papers stressing the immense challenges to be faced in meeting future energy demand, hinting that the challenges might not be met despite its considerable expertise. Chevron recently joined their campaign publishing an advertisement in national newspapers stating that the ‘Era of Easy Oil is Over.’
See the full ad at: http://www.oildecline.com/chevron.pdf
James B
Comments above excerpted, with edits, from these sites:
http://www.eia.gov/pub/oil_gas/petroleum/feature_articles/2004/worldoilsupply/oilsupply04.html
http://en.wikipedia.org/wiki/Oil_depletion
http://www.oildecline.com/

Chairman Al

WASHINGTON, August 12, 2013 –U.S. corn growers are expected to produce a record-high 13.8 billion bushels of corn in 2013, according to the Crop Production report issued today by the U.S. Department of Agriculture’s National Agricultural Statistics Service (NASS). The forecast production is up 28 percent from drought-hit 2012.
http://www.nass.usda.gov/Newsroom/2013/08_12_2013.asp

PeterB in Indianapolis says:
August 14, 2013 at 5:22 am

Last year by this date, Central Indiana had close to 40 days with temperatures > 90F for the high, with about 10 over 100F. This year, we have had FOUR (that’s right 4) days with temperatures > 90F for the high, with none over 100F.

Here in New Hampshire we sometimes escape 90s altogether, but this year we’ve had 13, with the last on July 19th. OTOH, we had 7 days in June with a high below 70, it was a wet month.
Personally, I prefer cool summers, but I do like local corn….

Rod Everson

“Rud Istvan says:
August 14, 2013 at 8:23 am
Current outlook is for better than 170 bu/acre, about normal for our area, unless we get an early frost.. Last year because of dryness we barely managed 110.”
I think, with the weather experienced so far, “early frost” is on a lot of farmers’ minds. Every night we get down into the 40’s or close to it lately. Usually early August runs much warmer.
One thing about the 2500 GDD requirement: a lot of farmers got their corn in very late due to wet fields and turned in their usual seed corn for shorter-maturity varieties. That will help unless there’s an early frost to go along with the late planting.
As for the WSJ article showing the huge drop in corn prices, I wonder if talk isn’t circulating about removing the ethanol mandate, should the corn crop end up severely reduced. After all, given his recent track record, our President can now apparently just do it unilaterally without any input from Congress.

richardscourtney

James B:
Your post at August 14, 2013 at 8:30 am
http://wattsupwiththat.com/2013/08/13/the-us-corn-belt-and-the-summer-chill/#comment-1389769
says in total to me

Superior, sarcastic and ignorant as always – opinion unencumbered by any real information.

You really, really cannot resist the temptation to make a fool of yourself at every opportunity.
Had you bothered to use the WUWT search facility you would have found numerous examples which show that – as always – your ignorant, inferior and offensive comment is plain wrong.
I have repeatedly explained why David Archibald’s assertion is wrong.
He knows it, regular WUWT readers know it, and you could have known it prior to you again making a fool of yourself.
For example, here is a comment from me during a thread which discussed one of the articles about Peak Oil by David Archibald on WUWT.
http://wattsupwiththat.com/2011/10/27/peak-oil-now-for-the-downslope/#comment-780303

Richard S Courtney says:
October 28, 2011 at 5:26 am
Andrew McRae:
At October 28, 2011 at 1:45 am you assert:
“The oil optimists commenting here should remember one important logical and practical conclusion:
There is a world of difference between saying that peak oil has not happened versus saying peak oil will never happen. Peak oil is inevitable due to both physical and economic limits. The only question is when.”
Your mistaken assertion is supported by some others. For example, Mike Bromley the Kurd says at October 28, 2011 at 2:21 am;
“The truth? It’s a finite resource. It will run out at some day in the future. And the years approaching that time will be some frikkin’ ugly. Then we will adapt.”
Sorry, but no. The assertion is an error. In the real world, for all practical purposes there are no “physical” limits to natural resources so every natural resource can be considered to be infinite. This a matter of basic economics which I explain as follows.
Humans do not run out of anything. The usage of a resource may “peak” then decline, but the usage does not peak because of exhaustion of the resource (e.g. flint, antler bone and bronze each “peaked” long ago but still exist in large amounts).
A resource is cheap (in time, money and effort) to obtain when it is in abundant supply. But “low-hanging fruit are picked first”, so the cost of obtaining the resource increases with time. Nobody bothers to seek an alternative to the resource when it is cheap.
But the cost of obtaining an adequate supply of a resource increases with time and, eventually, it becomes worthwhile to look for
(a) alternative sources of the resource
and
(b) alternatives to the resource.
And alternatives to the resource often prove to have advantages.
Both (a) and (b) apply in the case of crude oil.
Many alternative sources have been found. These include opening of new oil fields by use of new technologies (e.g. to obtain oil from beneath sea bed) and synthesising crude oil from other substances (e.g. tar sands, natural gas and coal). Indeed, since 1994 it has been possible to provide synthetic crude oil from coal at competitive cost with natural crude oil and this constrains the maximum true cost of crude.
Alternatives to oil as a transort fuel are possible. Oil was the transport fuel of military submarines for decades but uranium is now their fuel of choice.
There is sufficient coal to provide synthetic crude oil for at least the next 300 years. Hay to feed horses was the major transport fuel 300 years ago and ‘peak hay’ was feared in the nineteenth century, but availability of hay is not significant a significant consideration for transportation today. Nobody can know what – if any – demand for crude oil will exist 300 years in the future.
But you assert;
“There is a world of difference between saying that peak oil has not happened versus saying peak oil will never happen. Peak oil is inevitable due to both physical and economic limits. The only question is when.”
That is similar to a neolithic man asserting;
“There is a world of difference between saying that peak flint has not happened versus saying peak flint will never happen. Peak flint is inevitable due to both physical and economic limits. The only question is when.”
Your assertion is devoid of any worth.
Richard

Richard

@ richard –
Charming as always. It’s clear I’m getting under your skin. I’m having fun.
I cited authoritative oil industry sources, easily located with a google search, contradicting your assertion. Once again, you sidestepped the actual information presented, masking it with a high-dudgeon snit. Poor Richard.
In Econ 101, one can assume an unlimited supply of any commodity in the market.
But in the real world, the finite supply of any non-renewable commodity has an effect on its market value. As supplies dwindle and commodity prices increase, the market shifts to other commodities in response. The oil companies know this – and are addressing it.
Crops renew annually. Coal and oil do not. The oil companies and the companies that serve them know that too. US peak oil has happened, and world peak oil is projected by authoritative sources, cited – suggesting investment in Pig Airlines.
I do agree with your description of how markets for commodities operate.
However, you again assert authoritative information without citing your sources, Any Cambridge schoolboy knows better. For example:
“There is sufficient coal to provide synthetic crude oil for at least the next 300 years.” Source?
BTW, you worked for the British coal industry, right?
(http://www.desmogblog.com/richard-s-courtney)
You may disagree, but it is clear the use of coal for fuel is contraindicated by two other considerations. First, the global warming contribution from the emissions from the process of converting coal or other materials to fuels, followed by the emissions from fuel combustion itself. In the US for example, transportation generates more than one-third of all U.S. carbon dioxide emissions and 30 percent of America’s total global warming emissions, per the US-EPA.
Second are the public health costs and deaths from pollution created burning coal and other hydrocarbon fuels. I refer you to the 12 June 2013 Guardian article:online – Excerpt: “Air pollution from Europe’s 300 largest coal power stations causes 22,300 premature deaths a year and costs companies and governments billions of pounds in disease treatment and lost working days, says a major study of the health impacts of burning coal to generate electricity.” (http://www.theguardian.com/environment/2013/jun/12/european-coal-pollution-premature-deaths)
Best –
James B

PeterB in Indianapolis

@David Archibald –
The UK is importing wood chips to run power plants because the greenie-weenies in the UK won’t allow the power plants to use Coal. It has nothing to do with a lack of supply of hydrocarbon fuels, and everything to do with completely stupid governmental policy.
If the majority of countries of the world allowed more coal mining and more fracking, the world would have enough coal, oil, and natural gas to run for at least another 250 – 350 years even including growing consumption rates. I don’t know about you, but that goes WELL beyond my lifetime!
One of the links on the right side of the page here at WUWT is a link to masterresource. You should do some reading there perhaps. We aren’t anywhere near peak-anything when it comes to hydrocarbon supplies.

James B says August 14, 2013 at 8:30 am

Exxon Mobil Corporation, one of the world’s largest publicly owned petroleum companies, is the most forthright of the major oil companies having had the courage and honesty to quietly publish the declining discovery trend

Will believe it ONLY when reflected in pricing that respects the reality of decreasing supply to consuming markets (and not just quote: ‘discovery trends’ which may be a potential term of art with specific inherent meaning) rather than monetary supply policy (e.g. QE) from the ‘central planners’ AKA the Federal Reserve et al allowing commodities traders (read that as: investment banks) with QE bucks to bid-up said commodities.
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