[Peace-discuss] Biofuels are prime cause of food crisis, says leaked (World Bank) report

[n.dahlheim at mchsi.com]

This article hits it right on the head----for the stability of the world order, let's hope the G8 decides to 
put a moratorium on biofuels production and listen to the World Bank's sage advice in this respect.

Best,
 Nick


----------------------  Original Message:  ---------------------
From:    "C. G. Estabrook" <galliher at uiuc.edu>
To:      Peace-discuss <peace-discuss at anti-war.net>
Subject: [Peace-discuss] Biofuels are prime cause of food crisis, says leaked (World Bank) report
Date:    Thu, 3 Jul 2008 22:13:12 +0000

> http://www.guardian.co.uk/environment/2008/jul/03/biofuels.renewableenergy/print
> 
> Aditya Chakrabortty
> Thursday July 3, 2008
> 
> [Senior development sources believe the report, completed in April, has
> not been published to avoid embarrassing President George Bush. "It
> would put the World Bank in a political hot-spot with the White House,"
> said one yesterday.]
> 
> Biofuels have forced global food prices up by 75% — far more than
> previously estimated — according to a confidential World Bank report
> obtained by the Guardian. The damning unpublished assessment is based on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.
> 
> The figure emphatically contradicts the US government's claims that
> plant-derived fuels contribute less than 3% to food-price rises. It will
> add to pressure on governments in Washington and across Europe, which
> have turned to plant-derived fuels to reduce emissions of greenhouse
> gases and reduce their dependence on imported oil.
> 
> Senior development sources believe the report, completed in April, has
> not been published to avoid embarrassing President George Bush. "It
> would put the World Bank in a political hot-spot with the White House,"
> said one yesterday.
> 
> The news comes at a critical point in the world's negotiations on
> biofuels policy. Leaders of the G8 industrialised countries meet next
> week in Hokkaido, Japan, where they will discuss the food crisis and
> come under intense lobbying from campaigners calling for a moratorium on
> the use of plant-derived fuels.
> 
> It will also put pressure on the British government, which is due to
> release its 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
> <http://www.guardian.co.uk/environment/2008/jun/19/climatechange.biofuels>
> to record levels. Although it was expected last week, the report has
> still not been released.
> 
> "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".
> 
> President Bush has linked higher food prices to higher demand from India
> and China, but the leaked World Bank study disputes that: "Rapid income
> growth in developing countries has not led to large increases in global
> grain consumption and was not a major factor responsible for the large
> price increases."
> 
> Even successive droughts in Australia, calculates the report, have had 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.
> 
> Since April, all petrol and diesel in Britain has had to include 2.5%
> from biofuels. The EU has been considering raising that target to 10% by
> 2020, but is faced with mounting evidence that that will only push food
> prices higher.
> 
> "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.
> 
> Supporters of biofuels argue that they are a greener alternative to
> relying on oil and other fossil fuels, but even that claim has been
> disputed by some experts, who argue that it does not apply to US
> production of ethanol from plants.
> 
> "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."
> 
> 
> [From <lbo-talk.org>. --CGE]
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