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Studies Question Link Between Biofuel, High Food Prices
by
findingDulcinea Staff
Global food prices are increasing and biofuel production may in part be to blame. New technology could hold the answer to food and energy needs.
30-Second Summary
As the United States tries to reduce dependence on foreign oil, it turns to biofuel alternatives such as corn-based ethanol and biodiesel made from soybeans to satisfy energy needs.
Critics say that increased demand for corn and soybeans is raising food prices worldwide. Grain supplies are at record lows and prices are approaching record highs.
According to Lester Brown, president of the Earth Policy Institute, if more crops are used for fuel production instead of food, the result could be global food insecurity.
However, growing countries like China and India are also affecting food markets. Their demands for products such as meat and dairy are increasing.
In addition, corn growers and the biofuels industry state that energy costs associated with growing and transporting crops play a larger role in food prices than the cost of corn.
Meanwhile, European countries and energy companies are looking to second generation biofuel, which uses plant waste instead of grains and vegetable oil, as an alternative to current biofuels. The required technology for second generation production, however, is still a few years out.
Critics say that increased demand for corn and soybeans is raising food prices worldwide. Grain supplies are at record lows and prices are approaching record highs.
According to Lester Brown, president of the Earth Policy Institute, if more crops are used for fuel production instead of food, the result could be global food insecurity.
However, growing countries like China and India are also affecting food markets. Their demands for products such as meat and dairy are increasing.
In addition, corn growers and the biofuels industry state that energy costs associated with growing and transporting crops play a larger role in food prices than the cost of corn.
Meanwhile, European countries and energy companies are looking to second generation biofuel, which uses plant waste instead of grains and vegetable oil, as an alternative to current biofuels. The required technology for second generation production, however, is still a few years out.
Headline Link: ‘As Global Food Costs Rise, Are Biofuels to Blame?’
World grain supplies in 2008 are the lowest on record, and grain prices are at near-record highs. With global demand for food and fuel growing, people have begun studying more closely the potential connections between food and fuel prices.
Source: Christian Science Monitor
Background: Energy Independence and Security Act of 2007
President Bush's January 2007 State of the Union Address called for a decreased dependence on foreign oil and an increased use of alternative fuel. He also encouraged a 20 percent reduction in U.S. gas consumption in 10 years. A full transcript of his address is available at the White House Web site.
Source: The White House
In December 2007, President Bush signed the Energy Independence and Security Act. According to its provisions, fuel producers must use no less than 36 billion gallons of biofuel in 2022.
Source: The White House
Opinions: Food and the energy market
In a recent report about the connection between ethanol and food prices, Lester R. Brown, president of the Earth Policy Institute, stated that the food and energy economies were merging. He asserted that food prices would closely compare to energy prices "if the fuel value of grain exceeds its food value."
Source: Earth Policy Institute
The National Corn Growers Association has responded to the "food versus fuel" issue, citing reports stating that "higher corn prices have little effect on either food or fuel prices."
Source: The National Corn Growers Association
Reactions: Global anger over food prices
In 2007, the demand for corn ethanol increased the price of tortillas and prompted thousands of people to march in protest in Mexico City. At the same time, Germany feared an increase in beer prices as farmers there were encouraged to plant rapeseed for biodiesel instead of barley.
Source: Time
Related Links: Europe's environmental focus and second generation biofuel
The United States has promoted biofuel as a means of reducing its dependence on foreign oil. However, the BBC reports European interest in the fuel comes from a more environmental focus. Plants grown for biofuel production absorb CO2 in an amount similar to the volume of gas released by the biofuel burned in a car engine. The cycle is essentially carbon neutral, but the energy required to plant and grow biofuel crops upsets that balance.
Source: The BBC
France, a European leader in biofuel production, is reconsidering its efforts. The country had anticipated blending biofuel with standard fuel within two years. However, reports that higher food prices may be connected to biofuel have prompted the country to consider second generation biofuel, which is made from plant waste rather than grain and vegetable oil. The problem is the technology for this fuel is still a few years out.
Source: Reuters
According to Shell, one of the world's largest distributors of biofuel, the second generation biofuel could potentially be the most environmentally friendly green fuel for vehicles. Shell expects it will take five to ten years to reach commercial production levels.
Source: Shell Group
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