Submitted by ETC Group on
Biofuels fuel global food crisis
Toronto Star/star.com July 08, 2008
PAT MOONEY
As G8 leaders meet this week in Japan, their ears will still be ringing from the bombshell dropped last week in a leaked World Bank report declaring that biofuels have forced global food prices up by 75 per cent, far higher than previously estimated.
The food crisis will be a major topic for world leaders, as millions of the world's most vulnerable people call for help. According to World Bank president Robert Zoellick, who wrote a letter to G8 leaders last week, the world "is entering a danger zone" that will require $10 billion for emergency food aid and to help countries deal with the double impact of rising food and fuel prices.
Many of the G8 countries, including Britain, members of the EU and the United States, have brought in policies dramatically expanding the use of biofuels through mandatory minimum biofuel content in domestic gasoline. Some have speculated that the World Bank's findings have been kept under wraps to avoid embarrassing U.S. President George W. Bush, whose administration has argued that biofuels are responsible for only 3 per cent of the rise in food process.
In Canada, Stephen Harper's government, with Liberal Leader Stéphane Dion's support, is poised to set a 5 per cent minimum biofuel content level in our gasoline, adding fuel to the food crisis fire.
But unlike other governments, many of which moved too quickly to promote biofuels, the Canadian government has the opportunity to consider the growing evidence that mandatory biofuel content requirements do more harm than good.
Coming on the heels of these findings by the World Bank is the Gallagher Report, which will be released in the U.K. in the coming days.
Like the World Bank's secret report, it points an accusing finger at biofuels as playing a "significant" role in the dramatic rise in global food prices that has left 100 million more people without enough to eat, the U.K.'s Guardian newspaper has learned. It also urges that far more research be conducted into the indirect impact of biofuels on land use and food production before the government sets targets for their use in transport.
The report, produced by a panel of government experts chaired by Professor Ed Gallagher, head of the Renewable Fuels Agency, is expected to trigger a review of British and EU targets for the use of plant-derived fuels in place of gasoline and diesel. It may even compel Prime Minister Gordon Brown, who campaigned on expanding the use of biofuels, to reverse course.
The World Bank's sister institution, the International Monetary Fund, has confirmed that biofuel production puts pressure on food supplies as crops are increasingly grown for fuel, not food. The increasing demand for food has contributed to higher prices, which the IMF says have risen by 50 per cent this year. Particularly hard hit are Asia, the former Soviet Union, southern Africa and parts of Latin America.
Canadian policy-makers should also consider the fact that even U.S. food producers are calling on the Bush administration to ease minimum biofuel-content regulations for American gasoline.
Keith Collins, former chief economist in the agriculture department, released a study last month, funded by Kraft Foods, saying that as much as half of the sharp increase in corn prices over the last few years is due to the demands of corn-based ethanol production.
"We've seen a tremendous range of unintended consequences" from the requirement that increasing amounts of biofuels such as ethanol be blended into gasoline, Collins told the New York Times.
Texas has already lodged its complaints, and more states will follow. In April, Texas Governor Rick Perry said the "misguided" mandate was devastating the livestock industry in Texas. He asked for a large decrease in ethanol requirements in order to free corn for use as animal feed.
Given all of this new evidence casting doubt on biofuel regulations, it is utterly reasonable for the Canadian government to take the time needed to fully consider all aspects of the proposed minimum biofuel content regulations for Canadians' gasoline.
Let's be sure that the legislation is helping, rather than harming, Canadians, the environment, and the world's most vulnerable people.
Pat Mooney is executive director of the ETC Group, an international organization addressing the impact of new technologies on rural communities.