Biofuels caused food crisis according to secret report

[+Green Blog]

According to a secret World Bank report obtained by the Guardian biofuels have increased global food prices by up to 75%. The report dismisses the idea that droughts in Australia and rising demand from India and China has caused the rising food costs. The report instead claims that “the EU and US drive for biofuels has had by far the biggest impact on food supply and prices”.

“Political leaders seem intent on suppressing and ignoring the strong evidence that biofuels are a major factor in recent food price rises,” said Robert Bailey, policy adviser at Oxfam. “It is imperative that we have the full picture. While politicians concentrate on keeping industry lobbies happy, people in poor countries cannot afford enough to eat.”

Rising food prices have pushed 100m people worldwide below the poverty line, estimates the World Bank, and have sparked riots from Bangladesh to Egypt. Government ministers here have described higher food and fuel prices as “the first real economic crisis of globalisation”.

The report “would put the World Bank in a political hot-spot with the White House.” The US government claims that biofuels only contribute to about 3% in increased food prices. Senior development sources have said that the report “has not been published to avoid embarrassing President George Bush.”

But it’s not just USA who should feel embarrassed by the findings in the report. The European Union is also a big player in the biofuel world.

Recently the European Environment Agency’s (EEA) Scientific Committee called for the suspension of EU’s target to increase the share of biofuels used in transportation to 10% by 2020. The committee has called for a new, “comprehensive scientific study on the environmental risks and benefits of biofuels” before any targets should be set.

And it wasn’t long ago Jean Ziegler, UN’s special rapporteur on the right to food, called for the suspension of biofuels production saying biofuels are a “crime against humanity.” And before that, Finance Indian Finance Minister P. Chidambaram said that “it is “outrageous” that developed countries are turning food crops into biofuels while billions of people in the developing countries are living on the edge and trying to cope with escalating food prices”.

And even more pressure is expected to come from the British governments own report on the impact of biofuels, the Gallagher Report.

“The Guardian has previously reported that the British study will state that plant fuels have

played a “significant” part in pushing up food prices

to record levels. Although it was expected last week, the report has still not been released.”

Have our car-fetish really taken us this far? Do we actually approve and like the idea to transform food into fuel to keep our gas-guzzling cars running, no matter what the costs are?

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[mountainhiker]

According to a secret World Bank report obtained by the Guardian biofuels have increased global food prices by up to 75%. The report dismisses the idea that droughts in Australia and rising demand from India and China has caused the rising food costs. The report instead claims that “the EU and US drive for biofuels has had by far the biggest impact on food supply and pricesâ€.

Politically motivated pile of crap, should have remained secret! How can you dismiss drought and rising demand as part of the equation! :info:

[Simon]

Politically motivated pile of crap, should have remained secret!

How do you mean?

How can you dismiss drought and rising demand as part of the equation! :info:

I guess the drought in Australia was to weak and only affected one major area. And that the rising demand in China and India wasnt high enough. If you think about it, it do make sense.

[mountainhiker]

How do you mean?

I guess the drought in Australia was to weak and only affected one major area. And that the rising demand in China and India wasnt high enough. If you think about it, it do make sense.

one, the report was someones opinion, not the result of a study. also if you follow the news in China, the rising demand is huge.

[Simon]

one, the report was someones opinion, not the result of a study. also if you follow the news in China, the rising demand is huge.

Huge yes, but huge enough to cause a food crisis?

The damning unpublished assessment is based on the most detailed analysis of the crisis so far, carried out by an internationally-respected economist at global financial body.

"Without the increase in biofuels, global wheat and maize stocks would not have declined appreciably and price increases due to other factors would have been moderate," says the report. The basket of food prices examined in the study rose by 140% between 2002 and this February. The report estimates that higher energy and fertiliser prices accounted for an increase of only 15%, while biofuels have been responsible for a 75% jump over that period.

It argues that production of biofuels has distorted food markets in three main ways. First, it has diverted grain away from food for fuel, with over a third of US corn now used to produce ethanol and about half of vegetable oils in the EU going towards the production of biodiesel. Second, farmers have been encouraged to set land aside for biofuel production. Third, it has sparked financial speculation in grains, driving prices up higher.

Other reviews of the food crisis looked at it over a much longer period, or have not linked these three factors, and so arrived at smaller estimates of the impact from biofuels. But the report author, Don Mitchell, is a senior economist at the Bank and has done a detailed, month-by-month analysis of the surge in food prices, which allows much closer examination of the link between biofuels and food supply.

The report points out biofuels derived from sugarcane, which Brazil specializes in, have not had such a dramatic impact.

"It is clear that some biofuels have huge impacts on food prices," said Dr David King, the government's former chief scientific adviser, last night. "All we are doing by supporting these is subsidising higher food prices, while doing nothing to tackle climate change."