The cost of bioenergy: food or fuel

The price of food is soaring. Despite deforestation and improvements in fertilization, irrigation and other farming practices the price of feeding oneself continues to rise. A number of reasons have been offered for this: the rise in the global population, large shifts to a western diet – heavy meat consumption (which is far more intensive to produce due to the need for animal feed etc), extreme weather, misguided government policy, panic buying by importers, speculation on the financial markets, pro-longed under-investment in the agricultural sector. All, undoubtedly play their part. But, so does the shift to renewable energy supplies. Biofuels are in increasing demand, which means more land that could be used to grow food is being devoted to them.

This year it is estimated that 40% of the United State’s corn crop will go into car engines after it is turned to ethanol. Considering that the US is the worlds largest producer and exporter of corn this is huge amount of produce that is being lost to the food markets. The, subsidized, production of biofuel from corn is increasing rapidly. Ten years ago only 7% of the corn crop was being used to make biofuels. The rapid increase in biofuel production and consumption has had a direct impact on the price of the weekly food shop.

This rapid increase is also being seen in the United Kingdom. 18% of biofuels used in the UK are being produced from corn and wheat. Two staple foods, particularly in the developing world. Just over a year ago hardly any of these types of biofuel were being used in the UK and just over a year ago the cost of food was far cheaper.

The International Monetary Fund observed in 2008 that biofuels accounted for 1.5% of the global liquid fuel supply for the year but also nearly half of the increase in food crop consumption. It is is important to understand where the majority of these crops are being produced; the developing world. Increasing amounts of arable land in areas such as Africa are being turned over to biofuels; which are invariably being produced for export to the developed world, frequently by multinational corporations from the developed world. Less food being planted leads to an increase in food imports and an increase in the global market prices for foodstuffs.

Increased prices for food and an increase in the demand for biofuels are occurring at the same time. The European Union has set a target for 10% of transport fuels to be biofuels by 2020 whilst the World Bank has estimated that between June and December 2010 an additional 44 million people fell below the poverty line because of food price rises. The World Bank President Robert Zoellick has called for the world to “put food first”. It is clear that biofuels cannot be relied upon as a large scale fuel source in the future. Increased demand will lead to increased prices for both biofuels and food.

However, this is a problem that is beginning to be acknowledged by the governments of the world. The Global Bioenergy Partnership has been formed by the G8 Countries, 5 emerging economies and 13 International organisations and has agreed guidelines for the production of biofuel that doesn’t affect food prices or contribute to climate change. The formation of such an organisation indicates that currently the biofuel industry is unsustainable.

It is clear that the biofuels currently being produced and consumed are having a negative impact on the price of food. Because of this it would be a mistake to rely on them as a source of energy. Other renewable sources, such as wind or solar do not come with such a heavy price.