Battle for Biofuels Drives World Food Prices Higher
America's thirst for environmentally friendly biofuels is driving up food prices around the world as farmers scramble to devote more land to corn.
With the oil price back above $70 a barrel, biofuel looks increasingly attractive, and as more corn is grown to fill fuel tanks, the prices of other food crops are also being pushed up.
'The biggest impetus right now is the fact that the oil price is very high, and ethanol is very viable,' said Kona Haque, senior commodities editor at the Economist Intelligence Unit. 'It's a land issue: it's a competition for acreage. Countries are devoting an increasing amount of their land to fuel.' Even meat prices have been affected, as there is less land available to grow soybeans to feed livestock.
Almost a quarter of this year's US corn crop is expected to be turned into fuel. Drought in Australia has added to the food prices spike, which is feeding through to world inflation.
Guardian Unlimited © Guardian News and Media Limited 2007
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22 Comments so far
Show AllI feel for you and your 88 yr old father zooeyhall. Sadly Sen's Nelson and Hagel are on the payroll of ADM, Conagra and Monsanto. I'm sure all 3 companies are involved with the purchase of small farms throughout the midwest since the early 80's. Only 2 words come to mind when I think about what the large agribusinesses are doing to the midwest... you know what those are. I pray this never happens again. My own grandmother lived during the Dust Bowl days of Oklahoma and was forced off of her land with her parents when the depression hit. Ethanol won't be the answer anyway. Electric cars will though. We should also be looking into helping more farmers keep their lands. It's sad that both parties claim to be for the people but neither are. I hope your land stays as beautiful as your father & grandfather kept it.
I am a farmer in Nebraska, where I farm 160 acres of corn (a "small" farmer by any standard). I have lived on my farm for 50 years. I wish people could see up close the devastation to the local countryside that this ethanol frenzy has brought---and is going on as we speak. Landowners are ripping-out beautiful windbreaks and tree stands of cottonwoods and elms, these were windbreaks that were planted by the CCC back in the New Deal days, and getting the land ready to grow corn. This past winter, an out-of-state corporate farm came in and purchased a neighbor's farm. This farm was a beautiful piece of property with a grand 100 year old home and excellent buildings. They outbid all of the local farmers who wanted to buy it. Within 2 months they had completely stripped everything away--it's all gone. All there is now is one big corn field. It just broke my 88 year-old dad's heart to see it. Other farmers around me are busy plowing-up grass pastures for corn production, land so hilly and highly erodable I never would have thought it could be used for growing row crops.
This corn-for-fuel thing has everyone in my area plowing-up their alfalfa fields. Alfalfa is an excellent low-input crop. Once it is established it pretty much takes care of itself, doesn't need any fertilizer or herbicides. I produces alot of protein and naturally enriches the soil. It takes a good two years after planting to get a crop from alfalfa, so with the dissappearance of these fields I don't care to think about the long term effect it is going to have on dairy farmers in my area, who need lots of locally grown hay.
I wish I could post some pictures I have taken of the devastation.
New-built and proposed ethanol plants are going-up in the cities around me. No matter that they require enormous amounts of water in an area that is experiencing growing water shortages. The Platte River, which is about 10 miles from where I live, is a major gathering place for birds migrating to Canada. It has completely dried up in the summer months the past several years.
Our senators Nelson (D) and Hagel (R) beat the drum for ethanol production with every speech they make. But that is probably because Monsanto and ADM were big contributors to their campaigns.
Rhndevu, your statement about efficiency is only true in Adam Smiths theorized market economy, which we do not have. We do not have pure competition in the sense that he talked about. There are rules in his system that we do not adhere to, the biggest being equal access to all markets and resources and no one haveing monopolies on a process, i.e. patents. The system we have now is totally dependent on consumption and volume, the more volume the more profit, so waste is encouraged. An individual producer may be efficient, but the economy as a whole is very inefficient. Vast amounts of natural resources are being wasted. The bio-fuel example rests on the internal combustion engine which is quite inefficient itself, a steam engine can be 3-4 times as effective at converting energy into work. The powers that be are not interested because they are making far too much money on the wasting of energy that increases oil consumption.
Every time this discussion gets going the same comments arise and I feel the need to throw in certain qualifiers. Estimates of the percentage of the total that could be contributed by renewables are based on current inefficiencies and trends of increasing consumption. There is no way out of this mess without drastically improving energy efficiencies in all areas. This can and will be done.
It is interesting to note that the environmental movement (in the U.S.) that resulted in the Surface Mine Reclamation Act, The Clean Water Act, and The Clean Air Act flourished during the height of the cold war when our adversary was completely indifferent to environmental responsibility, yet could still not - despite this advantage - prevail. Free-reign corporatists conveniently leave this unmentioned as they complain that national regulation puts U.S. business at a disadvantage.
Equitable and enforcable regulation, across the board, no-one is exempted, should promote fair competition.
Marvellous.
Now we can look forward to billions in the Third World paying a terrible price with their very lives .(Just so that the West can continue with its , totally depraved lifestyles.)
Starving to death -simply because they can't afford to feed themselves any more.
Sir Bob , Bono and Tony Blair : one can't really see you (and the rest of our divine celebrities) lifting a finger to help ,this time around.
How can you .That would mean giving up on your most cherished freedoms ( that of flying around the world on a mere whim ,swilling champagne and munching caviar-laden canapes ) just to feed a few billion 'darkies'.
Good point, eraldo. I had only heard estimates as high as 10% as to how much fuel ALL of America's corn could yield. Whatever the case, it is an agribiz-subsidized joke. The net input to output ratio of corn ethanol production is LESS THAN ONE!!!
I've heard that sugarcane ethanol has a much more impressive yield (as high as 8:1)? But that's moot. There are countless unexplored, vastly more efficient technologies out there (algae-biofuels for one), but of course those in charge go with the lowest common denominator, the most lucrative corporate interest, the most nearsighted possible option.
Careful when looking to see the forest for the trees. Soon enough the trees won't be a problem.
If Seed Hemp was allowed to be grown in the US we could use that without inpacting food crops to make plenty of bio-fuels as well as paper products like paper towels, toilet paper, paper for office use including copier and printer paper. Seeds from seed hemp could produce oil for use in everything from cooking, paints and industrial uses. Trees would also get a break. Europe is already producing seed hemp for use in various products including oils, paper products and bio-fuels. The US does not allow the plant to be grown for any purpose, currently.
There are 3 interesting things surrounding the use of seed hemp most people are unaware of.
1 - the USDA put out a film called Hemp for Victory urging farmers to grow hemp during WWII when the US lost the source of hemp at the time when Japan seized control Indonesia and the southeaest Asian hemp markets. Hemp was used to make ropes and canvas for the US Navy. American farmers grew seed hemp during the war.
2 - when Marijuana was made illegal, hemp was also banned. The next day the oil being used in paints was no longer hemp seed oil, but petroleum oil sold by DOW Chemical.
3 - Seed hemp cannot be smoked or eaten to obtain a "high" as it contains no THC. Since law enforcement is believed to be too stupid to tell the difference between the 2 Cannibas plants, seed hemp remains illegal and in the same class as Marijuana.
rtdrury, although I agree with local production, farmers markets, etc., the subject about efficiency needs to be cleared up. Economic theory shows that the (competitive) economy will tend towards efficiency. If companies are more efficient, then they can lower their costs and the cost of their products and sell their stuff cheaper or outbid their competition. Actually, efficiency helps the economy grow, along with technological progress, etc.
What this country needs is more corporate regulations (what a sham the clean air act was), less agricultural subsidies which drive farmers in other countries out of business and create unfair competition in the world market, and responsible consumption.
BUILD BIKES................NOT BOMBS!
Fidel Castri is right--it is OBSCENE to prioritize feeding SUVs over feeding people.
If all the corn grown in the US was used to produce ethanol, that ethanol would only replace 12% of our current gasoline usage.
Looks like everyone will still have to stop driving completely to save the world.
What of conservation, efficiency, and a bit of designing of our transport systems to use far less? We can not power our current energy gluttony with biofuels without severe environmental impacts. We think ourselves so mighty but what will happen in the face of the reality of the results of our collective behaviors?
JH, good question - why not use the most efficient plants for biofuel production?
US-style capitalism does not favor production or allocation efficiencies because those have not proven to help grow the economy, which is priority number one. Growing the economy has to take priority because the tyranny of capitalism will be threatened should the economy stall. So to hell with efficiencies. A sloppy, inefficient, but growing economy is not only good for capitalism's image, it's also a nice chaotic environment for lawless zero-sum plunder and exploitation. Besides, less efficiency means larger corn fields, larger mines, larger processing plants, more jobs, wider freeways, larger tractor trailers, more overtime pay, larger bank accounts, more warplanes, larger egos, etc. It's all a big mess.
So you may boycott the capitalist's products, and build your own local economy around sensible, responsible, efficient production. And protect your rights through civic action, because the capitalist needs to confiscate them for the sake of economic growth.
A couple of things to consider:
One, yes ethanol can be made from other things than corn, and once the market share is there, you can bet competition will arise. If there's a cheaper way, someone will use it to get an edge. And what could be cheaper than using plant waste? The technology isn't there yet, but when the potential dollar signs start being there, the progress will be made. Corn is just the low-hanging fruit, it's not the last word.
Two, there are a lot of subsidies and incentives in place to keep food production artificially low in order to keep prices high. Farmers are paid to not grow or not sell, the supply is manipulated to maintain a profitable price range. There is excess capacitynot being utilized, and the system will sooner or later catch up to match the new demand. Mexico has a lot of corn growing capacity that is currently not being tapped due to US corn subsidies and the resulting unfair competition, but if ethanol companies need more corn, and US farms can no longer meet the demand, there's nothing stopping them from buying farmland in Mexico to supply additional material.
No energy solution is perfect, but ethanol is a better alternative than fossil fuel and it's going to get better as technology improves and the price of oil continues to rise. It might not be where want to be in fifty or a hundred years, but it will certainly be a better way of getting there than continuing to use oil.
Why can't biofuels be made from the waste product of the food production? Not the corn kernels, but the cob, husks, and plant stalks? Why use corn at all? Why not use other plant products such as left-over sugarcane (bagasse), or hemp plants? Biofuels could be produced from plant materials that don't require the petroleum-based fertilizers, at least not in quantity. I don't understand placing food and fuel in competition for the same crop. I know, I know, it's all about agribusiness and profits, but when will common sense and common decency prevail?
"Biofuels" are another capitalist pyramid scheme that will one day collapse and crush us all in the process. It pollutes, steals food out of people's mouths, destroys the rainforest, and is not even efficient.
Kelmer is correct about the meat industry being an equivalent to this stupidity and lack of consciousness. I am a raw food vegan, I patronize almost exclusively local organic produce, and have never driven a car. I hope more people wake up.
http://www.dreamingearth.net
I have decided to patronize our local farmer's market now even though it is not currently the most cost effective choice. We need to promote these people's efforts right now in order to ensure they ( and their local farmland ) can feed us in the future.
The price of food is still ridiculously cheap when compared to the long-term damage factory farming does to the planet as a whole. Our consumption of giant animals will be a problem in the future, FOR SURE! Why do you think people eat insects, frogs, rabbits, and other such animals from their particular environment. There will be an "adjustment", and it won't be pretty. People only see global climate change, but they fail to see the loss of a true connection between existence of the food chain.
The family farm is gone in this country so the effect of higher food prices will be controlled by the big corporations just as big oil is. "We can't afford flour for bread so we'll just eat cake." ENJOY!
It's actually the cost of the war which is reflected in our higher food prices. War has driven up the cost of oil, has wasted untold amounts of fuel, and driven a stop gap measure of bio-energy fuel. The sad story is that food for human consumption reflects mostly the cost inputs of labor and transportation. Ethically, the moral implications should be stated in terms of the imported food for human consumption, based on our foreign policy of keeping the rest of the world in a cheap labor market, and driving their populations futher into poverty and food shortage. Bio fuel makes sense as a part of the solution, but not simply converting corn into ethonal. More significant is the cheap processed food we force poor people to eat, made from processed corn and beans rather than the wide variety of vegatible crops so necessary for health and nutrition.
The meat industry is a global plague anyway(pollution, wildlife destruction, unhealthy, you name it)--the real issue comes down to the wasting of water and the wasting of agricultural land in order to raise crops to feed livestock--instead of using the water and crops to feed humans. Simple mathematics-and an argument that dates back to Diet for a Small Planet in the late 60s. But it didnt persuade people then to give up meat in order to feed the world--so its no surprise that the same would happen with biofuels.
Same with GMOs. Destroying more of the Amazon to grow soybeans for Europeans--but not for them--for the livestock.
Criminal waste of resources.
ethanol is .03 percent of the gasoline used in the united states. the only corn you use to make ethanol is gm corn because of the high yeilds. to get the high yeilds you have to use more ferterlizer made from oil. the run off polutes the water and on and on......
ethanol is a dead end in more than one way. like 'clean' coal or nuclear. it is like banning plastics bags. remember when paper bags were banned?
None of the protein in the corn is used up in the process of making ethanol. So the leftovers can be used for animal feed. Soybean meal can also be fed to cattle after making biodiesel.
When it comes to a choice of feeding the world or driving our SUVs...I think we all know what choice Americans will make.