A few years ago, corn-based ethanol fuel was all the rage. Farmers shelved crops like wheat and soybeans and planted more corn instead in order to cash in on the new revolution. Bill Gates and Richard Branson pumped in billions in funding. And ethanol stocks soared.

Louis Basenese is one of the smartest investment analysts I know, and a good friend of mine to boot. And most of the time I agree with his research – and his conclusions. Just not this time.

President-elect Barack Obama is faced with the daunting challenge of fulfilling his campaign promises – promises he actually made, along with those that voters think he made.  Unfortunately, the latter category predominates.

Could biofuels be our savior after all? This from Bloomberg:

Biofuels can boost incomes and yields for farmers, revitalizing impoverished rural areas when they are introduced in countries with secure land ownership, the International Institute for Environment and Development said.

By raising the price of crops such as corn and palm oil, biofuels can reduce poverty in countries with a high dependency on agriculture, the London-based researcher said in a report with the United Nation’s Food and Agriculture Organization.

The sulfuric-acid market is booming and oil companies are reaping the rewards.

According to the London Times, the price of sulfur has risen from $50 to $500 a ton in under a year. More from this report:

“Shell is one of the most-efficient producers of sulphur,” Barry Clarke, a sulphur market analyst for Pentasul, said.

The Brazilian ethanol export market is rapidly expanding because of sky-high oil prices. While American corn ethanol is widely regarded as a boondoggle, existing solely because of government subsidies, Brazilian ethanol has proven beneficial for the environment and for business.

A month ago, I wrote an article here in the A-Letter detailing the global food crisis. According to data from the World Bank, global food prices have soared 83% in the past three years alone.

Interesting how certain threads come together… I read recently that copper producers are complaining about the skyrocketing costs of sulfuric acid.

Sulfuric acid (or sulphuric acid, if you’re a Brit) may not be grabbing headlines, but as the spot price of this industrial chemical surges, some interesting investment plays open up.

Sulfuric acid is used in mining to extract copper, nickel and uranium. It is also used in steel manufacturing, fertilizer production and oil refining.

“What’s really kicked off demand for this chemical, however,” according to Chris Mayer in The Daily Reckoning, “is the surge in ethanol production — a double whammy for sulfuric acid.

Well, I guess it’s now “official.” Over the weekend, representatives of the International Monetary Fund (IMF) and World Bank officially declared that we are in the middle of a global food crisis.