The Covid-19 Butterfly Effect Could Flatten Your Beer!

The fight against the Coronavirus has us staying home more and the numbers show we're drinking more beer as a result.  But the first fact could lead to the second fact falling flat!  Allow me to explain.

Have you heard about the Butterfly Effect.

The Farnam Street website describes the butterfly effect as: " the idea that small things can have non-linear impacts on a complex system. The concept is imagined with a butterfly flapping its wings (in one location) and causing a typhoon (halfway around the world). Of course, a single act like the butterfly flapping its wings cannot cause a typhoon. Small events can, however, serve as catalysts that act on starting conditions."

Well, here's a complex system in jeopardy and the butterfly flapping its wings is the Coronavirus.  The potential victim?  Your beer and soda!

It's complicated, but follow along for a lesson in modern interconnectedness.

The novel Coronavirus pandemic has halted many industries and sparked temporary shortages of many products, and now carbonated beverages may be next.

A Fox news article reports the cause and effect starting with the Coronavirus isolation  keeping us at home.  Even if we did decide to go somewhere, nothing is open, so we stay home and the car sits in the driveway. (Unintended consequences - less air pollution, fewer car accidents)

Since we aren't out driving around, we aren't using as much gasoline as we used to.and the price of gas is dropping - the result of the natural course of the change in supply and demand.

But how does not burning gas and thus drinking more beer,  flatten your beer?  Keep flapping my friend. All will be revealed to you.

The abundant supply of gas brings us to gasoline additive Ethanol, described as " a renewable fuel made from corn and other plant materials....more than 98% of gasoline in the U.S. contains some ethanol."

But if we don't make as much gas we don't make as much ethanol, right.  So????  So we aren't making as much ethanol.

Keep flapping.

The ethanol we aren't making has a valuable by-product -- which we aren't getting. A by-product of the process of making ethanol is carbon dioxide or CO2.

According to Ethanol producer, "fermentation from corn-ethanol plants is the largest single-sector CO2 source for the U.S. merchant gas markets..... a large number of applications led by food and beverages and dry ice applications...nearly 43 percent of domestic CO2 by-product for refinement and liquefaction is derived from 48 ethanol plants, mostly in the Midwest."

You see where this is going?.

The carbon dioxide (CO2) we aren't getting because we aren't making ethanol for the gasoline we aren't using because we don't need as much gasoline because we aren't driving around because Coronavirus has us staying at home where -ironically, we are drinking more beer - means the beer industry is having a tough time getting enough CO2 which is used for the carbonation process in soda and beer we are drinking more of at home. Whew!

Because of all this, CO2 suppliers have already increased prices by about 25 percent.

Will that impact the cost of beer and soda?  Stay tuned.