The United Nations’ Food and Agriculture Organization is calling for an urgent review of biofuel policies to preserve global food security, protect poor farmers and ensure environmental sustainability.
“Opportunities for developing countries to take advantage of biofuel demand would be greatly advanced by the removal of the agricultural and biofuel subsidies and trade barriers that create an artificial market,” said FAO director general Jacques Diouf.
In its State of Food and Agriculture 2008 report, the agency condemned ethanol and biodiesel mandates and tax incentives for leading to the “artificially rapid growth” in biofuel production. That led to high economic and social costs by driving up food prices.
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“All efforts should aim at preserving the utmost goal of freeing humanity from the scourge of hunger,” Diouf said.
The agency also said biofuel has caused more environmental harm than good in some cases by encouraging practices such as deforestation.
“Expanded use and production of biofuels will not necessarily contribute as much to reducing greenhouse gas emissions as we previously assumed.”
Gordon Quaiattini, president of the Canadian Renewable Fuels Association, said the UN agency didn’t look through the proper lens when assessing the industry.
Ethanol and biodiesel compete with oil, so it’s natural the first plants will be built in developed nations, which are heavy consumers of oil. However, he said that doesn’t mean all of the benefits stay in those countries.
The FAO report ignores the fact that high energy prices have a disproportional effect on consumers in the Third World, he added, so they reap greater rewards from the price-deflating impact of biofuel competition.
He scoffed at the notion that developing nations are prevented from participating in the biofuel sector, noting that last week Ethiopia introduced a five percent ethanol mandate to help address high energy prices.
As for the food versus fuel debate, Quaiattini said oil was selling for $147 per barrel at the height of the debate and agricultural commodity prices were sky high. At that time the biofuel industry argued it was oil that was behind the high food costs.
Six months later oil prices have dropped and corn, wheat and other agricultural commodity prices followed, which he said proves oil was the culprit.
Quaiattini also takes issue with the report’s assertion that greenhouse gas reductions associated with grain-based biofuel aren’t impressive.
“It’s rhetoric getting in the way of science,” he said.
Natural Resources Canada has what Quaiattini claims is the best life cycle analysis model in the world. It has recently been updated and still shows substantial greenhouse gas savings from grain-based ethanol.
He said the biofuel industry is partially to blame for what he considers to be an ill-informed FAO report. Industry leaders have spent so much time building their domestic markets that they haven’t done a good job telling their story to groups such as the FAO.
