Agrofuels Will Harm the World’s Poor

There’s a lot of good information surfacing recently on the follies of making fuel out of food. Paul Beingessner, in a recent edition of his weekly syndicated column, does an excellent job of cutting through the hype to lay bare the major problems that the expansion of the biofuels industry creates — especially for the world’s poor…

–Editor

By Paul Beingessner
Column # 626
July 3, 2007

Increasing prices for grains and oilseeds have some farmers optimistic about agriculture for the first time in years. The agrofuels industry is one of the main causes for increasing grain prices. The other is the fact that for nearly a decade, the earth’s population has consumed more grains that it has produced. Agrofuels became the tipping point that caused speculators and genuine grain buyers to realize that the supply/demand equation for food was tilting dangerously. Now, more than in the last number of decades, the market is hanging on every weather report from around the world.

Production of agrofuels, that is ethanol and biodiesel, is increasing with unprecedented fervor around the world. From Malaysia to Paraguay, and Uganda to Jamaica national governments are enacting policies to promote the production of fuels made from food and other crops. These include tax incentives for production, mandated addition of agrofuels to gasoline and diesel, seizure of land from peasants and indigenous subsistence farmers, and freeing up protected and fragile lands for cultivation.

There are several reasons given for countries to increase production of crops suited for agrofuels and agrofuels themselves. The most often cited is the need to find sources of energy that release fewer greenhouse gases.

This justification is the most used but the least defensible. There is much debate about whether ethanol production actually reduces greenhouse gases at all. The yield of energy compared to the energy needed as an input is very close for ethanol produced from cereals like corn or wheat. Most significant though, is the fact that agrofuels will never replace a significant amount of the world’s liquid fuels. If the entire U.S. corn harvest was used to make ethanol, it would displace 12% of the gasoline Americans use, and gasoline consumption is rising yearly. If all the soybeans produced in the U.S. were used to make biodiesel, it would displace only about 6% of the diesel.

At the global level, energy consumption is set to increase 71 per cent between 2003 and 2030, and most of that will come from burning more oil, coal and natural gas. By the end of this period, all renewable energy (including hydro, solar, wind and agrofuels) will make up only 9 per cent of global energy consumption.

Nevertheless, many countries have bought into the agrofuels hype. And while the production of these crops and fuels is highly subsidized (usually, but not only by government mandated use) the sale is left to the marketplace. Hence, agrofuels are bought and sold in the global marketplace, and countries like the U.S. and the European Union are intent on importing vast quantities of agrofuels and crop products to produce them. In the EU, for example, the target of achieving a 20 per cent mix of biodiesel in petroleum diesel by 2020 will require 20 billion gallons of biodiesel a year. This is more than 20 times Europe’s current consumption. As Europe simply doesn’t have any more land on which to plant its own biodiesel feedstock (canola), it will have to increase greatly its imports of both palm oil and soya oil.

When concerns are expressed about the diversion of food crops to fuel use, farmers in Canada tend to be skeptical. The world doesn’t want our food, and can’t afford it anyway. Hence, using our crops to produce fuel will not reduce the supply of food in poorer countries.

The latter statement is partly true, but it misses the point. The problem is not so much that our crops will be unavailable to other markets. It is that poor countries are diverting land away from food production to produce agrofuels to supply the demand from rich countries. The production of these crops depends on vast acreages of monoculture and to achieve this, fragile lands are being exploited and small farmers are being pushed off their lands. As a result, prices of staple foods are being driven up and poverty and unemployment are increasing. . The Food and Agriculture Organization of the United Nations estimates that the cereal import bill of low income, food-deficit countries - many of them in Africa - will increase by about one quarter this year as a direct result of the “ethanol effect”.

To make matters worse, destruction of rainforests and peat bogs is increasing the amount of greenhouse gases in the environment far beyond the modest reductions that using agrofuels might achieve. Malaysia, for example, has embraced the growing of oil palms for biodiesel production. Most of the land targeted for this is presently in peat bogs. As these are drained and dried, the peat begins to oxidize and releases vast amounts of carbon dioxide. Some 40 to 50 billion tonnes of carbon will be release over the next few decades, enough to destabilize the world’s environment even further.

Sadly, as far as the environment is concerned, the only real solution to global warming is to drastically reduce energy consumption. This is the one thing none of our governments seem prepared to contemplate. Our greed for energy in rich countries will spell even greater disaster in poor ones.

(c) Paul Beingessner (306) 868-4734 phone 868-2009 fax beingessner@sasktel.net