Biofuels add millions to the breadline

Media Releases, Opinion article written on the 25 Jun 2008

Unlike many other developed countries, Australia has not set mandatory targets for biofuel production or use. This is encouraging. The Australian Government should not to go down that path.
Why? Because biofuel production and use is driving up food prices and contributing to the current food crisis, which has seen prices soar by an estimated 83 per cent over the past three years.
The impact is shattering for millions of people already suffering from persistent hunger who spend up to 80 per cent of their income on food. Around 290 million people are now facing a new and immediate threat. The spectre of famine in East Africa haunts again. Nowhere in the world is immune from food inflation.
Some businesses are also starting to see the bigger picture. Last week, food and drink companies including Unilever, Nestle, Cadbury and Heineken asked the European Commission to review its policy that encourages biofuel production, stating that they believed it would help drive agricultural commodity prices to further record highs.
Biofuels worsen the food crisis because they create competition for land. If the fuel value for a crop, say corn, exceeds its food value, then it will be used for fuel instead of food – and that’s happening; grain reserves are at an all-time low.
The World Bank thinks the rush to biofuels, especially the growth of US corn ethanol production, has been a significant factor in the food crisis. The US and the EU see biofuels as an alternative to oil: a secure source of new transport energy and a way to tackle climate change. But biofuels are not going to cut our emissions or reduce oil dependency, because our petrol and diesel consumption continues its unfettered rise.
The mass land clearing that takes over agricultural land and forces farming to expand into lands like forests and wetlands, also triggers the release of excessive and damaging carbon into the atmosphere, cancelling out the environmental benefits of biofuels.
We need rich countries to make radical cuts in their carbon emissions and shift away from their fossil fuel-based economies, and we need a massive increase in longer-term agricultural investment. Instead of unsustainable energy use, governments should be supporting measures including setting and enforcing ambitious vehicle efficiency standards for car manufacturers and investing more in public transport.
Rich countries and institutions can move their policies and resources decisively when they really want to – witness the trillion dollars pumped into our listing financial markets in recent times. It is going to take similar vision and commitment from world leaders, including Australia, to help hundreds of millions of poor and vulnerable people to put affordable food on the family table. We’re all watching and time is running out.
Andrew Hewett
Executive Director
Oxfam Australia
This opinion editorial was published in the Australian Financial Review on Wednesday 25 June 2008.