National and Global Market Implications of the 2012 US Drought

February 26, 2013

By: Wallace E. Tyner, Energy Economist, James and Lois Ackerman Professor of Agricultural Economics, Purdue University

The 2012 drought in the US has caused tens of billions of dollars of economic losses and repercussions that reach all corners of the globe through market interactions. During the summer of 2012, there were numerous calls to suspend biofuels mandates. What’s missing from the public debate is an examination of two assumptions driving these calls: 1) that biofuels, not the drought , are to blame for price spikes and 2) that reducing or eliminating the biofuels mandate would quickly lead to price reductions.
National and Global Market Implications of the 2012 US Drought

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