Riots over food and fuel prices and supplies have broken out across western and northern Africa, in China, India, Pakistan and Mexico, as well as other countries around the world, posing real and substantial threats to civil order. Tens of thousands of fishermen in Spain, France, Italy and Portugal have gone on strike and are protesting in European capitals due to spiraling fuel costs.
Rapidly rising food prices and supply concerns have led many to point the finger of blame at biofuels production, along the way reigniting the debate about the net effect biofuels have on land use, the environment and carbon dioxide emissions.
As the EU considers cutting back its recently enacted biofuels targets, it seems that counter-arguments of biofuels proponents are being drowned out. Is this a case of the tail wagging the dog, or cow, perchance? And are these early portents of what is to come in other countries around the world as energy supplies continue tight, prices continue to climb and climatic conditions change?
Are biofuels the root, or even a signifcant, factor in rising food costs and supply shortages? Three other factors seem to be of much greater significance: rising oil, fuel and fertilizer prices; changing diets in rapidly growing urban populations in countries around the world – China and India in particular; and a changing climate, which is disrupting agricultural supplies.
In an update of their May/June 2007 article, “How Biofuels Could Starve the Poor,” in this month’s Foreign Affairs, authors C. Ford Runge and Benjamin Senauer write, “What at first seemed alarmist has turned out to be an underestimate of the effects of biofuels on both commodity prices and the natural environment. These price increases are substantial threats to the welfare of consumers, especially in poor developing countries facing food deficits. They are especially burdensome to the rural landless and the urban poor, who produce no food at all.”
In their article, Runge and Senaure point out “… the average price of corn has increased by some 60 percent, soybeans by 76 percent, wheat by 54 percent, and rice by 104 percent. Josette Sheeran, the Executive Director of the World Food Program, calls this a global ‚Äòtsunami of hunger.’ Robert Zoellick, President of the World Bank, estimates that there are 100 million newly poor and hungry people as a result of rising food prices.”
Are claims that rapidly rising biofuels production is the root cause of these developments justifiable? Or are other factors to blame?
The US and Brazil account for 95% or more of worldwide biofuels production. That doesn’t leave a lot that’s being produced in all the countries in the rest of the world. And even in Brazil, a mere 2.8 percent of agricultural land is dedicated to sugar cane production, mainly destined for ethanol, according to the agriculture ministry. Addressing the press recently, Brazilian president Luiz Inacio Lula da Silva dismissed claims that the global food crisis is due to booming biofuels production as an “absurd distortion.”
While acknowledging that the growing amount of cropland devoted to biofuels production is causing additional strains, Time reporter Vivenne Walt in a Feb. 27 article puts her finger on what seem to be much more significant factors driving up food prices and disrupting supplies .
“One reason: billions of people are buying ever-greater quantities of food – especially in booming China and India, where many have stopped growing their own food and now have the cash to buy a lot more of it. Increasing meat consumption, for example, has helped drive up demand for grain, and with it the price…
“The spike in oil prices, which hit $103 per barrel in recent days [Note: They broke $130/barrel recently, if I'm not mistaken], has pushed up fertilizer prices, as well as the cost of trucking food from farms to local markets and shipping it abroad.
“Then there is climate change. Harvests have been seriously disrupted by freak weather, including prolonged droughts in Australia and southern Africa, floods in West Africa, and this past winter’s deep frost in China and record-breaking warmth in northern Europe.”
The ugly side of free market speculation is also rearing its head. As food shortages have become a reality and with prices on a sharp upwards trend, speculators are pouring funds into commodities markets and funds, further exacerbating the problem.
How big a role do oil, natural gas and other fossil fuels play in our the global food supply chain? I found a good answer here, courtesy of Yahoo!