‘ETH’ ICAL ANOMALY

IIPM MANAGEMENT INSTITUTE

Ethanol has been a highly touted new age alternative. Ethanol is a bi-product of molasses extracted from sugar cane and large sugar companies are already engaged in its production. When ethanol is added to the normal fuel as a set percentage, it improves the combustion of the fuel and lowers emissions. According to the Energy Information Administration report, US, the cost of producing this fuel could be reduced by as much as 60 cents per gallon by 2015 using cellulosic conversion technology. Brazil is the leader in ethanol production, producing 15-16 billion litres of ethanol. It is investing $9 billion in new processing plants. The world’s largest company, US-based Archer Daniels Midlands boasts net sales of $11.4 billion (growth of 25% yoy) and net earnings of $362.9 million (growth of 4% yoy) for the nine months ended March 2007. Chairman & CEO Patricia A. Woertz stated that the company’s outlook on future opportunities remains quite strong. Equally strong, though, is the dilemma that if cars run on corn, what will people eat? Does it then remain resourceful enough?

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Source : IIPM Editorial, 2007

An IIPM and Professor Arindam Chaudhuri (Renowned Management Guru and Economist) Initiative