Corn Too Expensive? Turn Pigs into Ethanol

by Johnny Debacle

The WSJ yesterday reported how pig farmers are using fatty non-corn based substitutes to feed their pork assets as a response to surging corn prices. Corn prices are surging because the US Government thinks what the people want more than anything is to give money to large agribusinesses, like future Satan’s Portfolio member Archer-Daniels-Midland (NYSE: ADM). The domestic production of corn is directly subsidized. Corn based ethanol production is further subsidized. Sugar faces import tariffs but sugar cane is a far cheaper and more efficient feedstock for ethanol production. Lastly, the US gov straps a tariff on imports of sugar cane based ethanol from Brazil. What does this add up to? 4 sentences and a recipe for lucre for corn producers…and pig farmers.

The staid thinking would be that pigs must be turned into delicious bacon and pulled pork products and thus the pig farmers should switch from the more expensive corn to the cheaper substitute feeds to continue to supply these vital end markets. But there is a huge opportunity for pig farmers who think out of the box, which will in turn benefit the supply and demand situation for the entire pork industry.

If people want ethanol, then give the people ethanol….made from pigs: Piganol. The technology is still under development and we are under a myriad of NDAs so we can’t speak to the science behind it but it’s a fact that piganol is on it’s way. The picture we provided in our previous article was from an actual field test and the bike not only gets great mileage, but the only thing it pollutes is bacon. The firm developing the product has achieved some important milestones indicating enhanced viability of a piganol based consumer energy source.

Recommendation: We maintain our “Delicious” position on Bacon and increase our rating on piganol from “Suspicious” to “Delicious”.

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  1. May 22nd, 2007 | 11:47 am

    While I salute Mr. Debacle’s commitment to SRI and helping the American farmer I find the future of pork highly volatile. The only thing we may be certain of is its deliciousness. I suggest entering into an OTC swap of fixed deliciousness for floating piganol prices as a hedge.

  2. Economicist
    May 22nd, 2007 | 11:52 am

    A little-known fact is that major automotive manufacturers have been working on similiar initiatives; GMC is working to convert the Hummer to run directly on endangered species.

  3. May 22nd, 2007 | 11:58 am

    I hear the WWF85 blend is very eco-friendly. It’s your standard snow leopard, bengal tiger and florida panther blended with 15% gasoline.

  4. Mini-Baller D-Lux
    May 22nd, 2007 | 1:49 pm

    Hold investment reserves for the advent of Soylentanol. Combined with the “make pollution delicious” theory, this technology could create a perfect cycle.

  5. CatHairSweater
    May 23rd, 2007 | 12:54 pm

    Silly Americans! Visit the Japanese mainland. We have been fueled by Black Rhino horn and the ground penises of endangered species for years. An aphrodesiac and fuel source in one.

  6. ast4
    May 23rd, 2007 | 3:25 pm

    One could also enter a long position in piganol. With deliciousness carrying a standard deviation of 0.9534625892455924 (calculated with a sample of friends enjoying the deliciousness of bacon). Futhermore, one could hedge the position by establishing a synthetic short position via short call long put option, creating a constant delta of -1 and now a beta of 0.

  7. Cincinnatus_C
    May 25th, 2007 | 9:39 pm

    there’s also…tylenol…derived from…well, tylenol.

    another source:

  8. Cincinnatus_C
    May 25th, 2007 | 9:48 pm

    “Futhermore, one could hedge the position by establishing a synthetic short position via short call long put option, creating a constant delta of -1 and now a beta of 0.”

    um, only if by ‘synthetic’ you mean not real, in that no one would do that b/c it’s wrong.

  9. June 7th, 2007 | 2:41 pm

    This couldnt be more dead on. I found this article recently, Why Ethanol Cannot Live Up to all the “Perfect” Energy-Solution Hype . It has a lot of good points.

    This WILL open your eyes, so take a look…Cheers!