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   Web Issue 3245 September 6 2008   
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World Bank blames biofuels for food inflation

Biofuels have caused world food prices to go up by 75%, according to a new report from the World Bank.

A leaked copy of the report contradicts US government claims that using plants to produce fuel contributes less than 3% to food prices.

It was claimed today that the the analysis - carried out by a respected economist at the global financial body - has not been published to avoid embarrassing US President George Bush.

The leaked study reportedly concludes that income growth in developing countries was not a major factor in food price rises, while successive droughts in Australia had only a marginal impact.

Instead, it argues that the EU and US drive for biofuels has had by far the biggest impact on food supply and prices.

"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," the study is reported as saying.

"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."

Biofuels - derived from crops such as corn, rapeseed, palm and soya - as an alternative to petrol and diesel were seen as the environmentally-friendly solution to global warming and rising fuel prices.

The high-profile international issue is due to be discussed by G8 members next week in Japan.

Today's report also comes ahead of the Government releasing its own report on the impact of biofuels by Professor Ed Gallagher, head of the Renewable Fuels Agency.

On Monday, shadow agriculture spokesman James Paice let slip during a Parliamentary debate that the Gallagher report found increasing production of biofuels was "not sustainable".

In Tory-led debate on food security, Mr Paice was challenged to set out Conservative policy on biofuels.

He replied: "The issue of biofuels has to be based on sustainability. It's quite clear in the Gallagher report last week - or whenever it was - that it's not sustainable."

The review was commissioned by Transport Secretary Ruth Kelly in February to look into concerns that biofuel production could have an unwanted side effect of raising global food prices.

On Monday, MEPs will vote in the EU Parliament's Environment Committee on proposed amendments to the Renewable Energy Directive, including an amendment to scrap the target to source 10% of transport fuels from biofuels by 2020.

Responding to the leaked study, Friends of the Earth biofuels campaigner Kenneth Richter said: "This report shows that when MEPs vote on biofuels targets next week they will have the fate of millions in their hands.

"Finding enough land to grow 10% of Europe's transport fuel will lead to more hunger and suffering - as well as doing next to nothing to reduce carbon dioxide emissions.

"Politicians must act responsibly and change course on this disastrous transport policy."

He called on MEPs to scrap biofuels targets and vote instead to double the fuel efficiency of new cars by 2020, which he said would do more to reduce dependence on fossil fuels.


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Posted by: Los Angeles, Edinburgh on 1:56pm Fri 4 Jul 08

Good ole George. Screwed it up for everybody as usual.

Posted by: daydreamer, Edinburgh on 2:35pm Fri 4 Jul 08
This article is unusually direct and non-misleading for a Herald sustainable living piece. Although what it doesn't say is "Don't expect anything to change - western governments want biofuels to work pretty much regardless of cost because it's the closest they can think of to business as usual."
Posted by: Jwil, Lanarkshire on 3:02pm Fri 4 Jul 08
What happened to all the brilliant economists. Did they not suss out that there would be a knock-on effect, or did they just ignore it?.
Posted by: Neil 9% Growth, Glasgow on 3:47pm Fri 4 Jul 08
Eco-fascist bastards.

It is not just the Luddites wasting the rich countries money on another token which they know has little or no real effect (to grow plants for bio-fuels takes fertilizer which rakes oil to produce). They are, pretty literally, taking the food out of the mouths of the world's hungry.
Posted by: CC, Glasgow on 4:50pm Fri 4 Jul 08
There are forests being ripped up to provide land to grow the plants for the bilfules, how exactly does this help the environment ?

They are taking from one hand to benefit the other, the net effect is that the environment is no better off, and the poorest countries suffer the most due to food prices being higher........great economics that !
Posted by: dave, north on 7:27pm Fri 4 Jul 08
Wheat prices today are about 25% dearer than 25 years ago in Europe.I dont consider this to be much of a price rise.Prices have risen not because of biofuels,but because for the last 25 years agriculture around the globe has been seen as a nuissance,and governments have invested nothing in R&D.Farmers yields havent risen in the past 10 years due to poor prices meaning farmers had little to reinvest in new technology and plant breeding.The worlds population is rising faster than crop yields.This will lead to starvation in countries whose populations breed to quickly.This problem is far far bigger than politicians.Each country in the world should grow enough food for its own population.And each countries population should match the food it can produce.Until that basic issue has been addressed,there is no point in talking about saving the planet etc.
Posted by: daydreamer, Edinburgh on 7:31pm Fri 4 Jul 08
CC wrote:
There are forests being ripped up to provide land to grow the plants for the bilfules, how exactly does this help the environment ? They are taking from one hand to benefit the other, the net effect is that the environment is no better off, and the poorest countries suffer the most due to food prices being higher........great economics that !
If you can accept that western governments, for all their posturing, will always put their own interests first and the interests of the third world last. If you can also accept that said western governments will bury their heads in the sand until their heads are forcibly removed by circumstance regarding climate change and sustainable living. The economics make more sense than some might imagine. Unfortunately for most of us, and the future of the planet.
Posted by: Free Thinker, North Lanarkshire on 9:33pm Fri 4 Jul 08
World Bank = New World Order = Black Nobility Establishment.

Wake up!
Posted by: frank mcbride, lusitania on 11:12pm Fri 4 Jul 08
#DaveNorth.

I accept your hypothosis.

Unfortunately, this is not the agenda of our rulers. They are more interestedin creating fear, than security.

The notion that "the world cannot feed itself" is a lie.

When "the powers that be" dictate that poor, agriculturally rich, countries produce "Cash Crops" rather than food for their people, then we know where their concern is; THEIR POCKET & POWER.

This is a "Crocodile Tears" report from the World Bank; poor countries HAVE TO produce CASH CROPS to pay Word Bank debt & IMF loans.

More money "aid" is being spent on arms & destabilisation than on food production.
Even the UN couldn't account for its expenditure in "aid".

If "the powers that be" were really interested in global security, rather than global insecurity, they would have acted against Mugabe - Zimbabwe is a agriculturally very rich country, but they don't. WHY?

Zimbabwe, Malawe, Kenya, Uganda are only a few of the agriculturally rich land that have been allowed (encouraged) to go to waste. WHY?

Those who are prepared to say that it's Black Africa's own fault should look at who support(ed) the corrupt politicians of those nations, with "aid" - WB &IMF loans, arms and "grant aid", that was/is used for repression.
Posted by: bob mckay, glasgow on 12:11am Sat 5 Jul 08
Its all Pete Tong.
Im no R and D electromagnetic engineer but.......when mobile phone batteries can become a 20th of the size with 20 times the power...............
what happened to electric car development? Seems its becoming time to choose; status quo and inevitable confilct and decline.........or drastic change for the uK energy supply.
Not all biofuels are bad; we should be recycling waste products but not growing transport fuel. We can all seee thats unsustainable madness.
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