It’s not dead, it’s just resting.
That was the recent message about the food-versus-fuel debate from a German grain industry expert.
“The issue is not going to go away,” said Klaus Schumacher of Toepfer International. “There will be a discussion again whenever prices rise.”
He said the effect of biofuel on food prices could easily become an issue again once the current economic slump has passed.
North America experienced only a muted form of the debate that set farmers against consumers in many nations as grain prices soared in 2008.
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In developing countries such as Mexico, “tortilla riots” broke out over the skyrocketing price of corn flour.
In developed countries such as Germany, concerns were heard about how European biofuel subsidies were affecting the cost of food to the world’s poorest people.
Even within rich areas such as the European Union, consumers became angry about increasing food prices due to biofuel production.
Schumacher said Europeans had become comfortable with a multidecade trend in which food prices always became relatively cheaper. They weren’t happy to accept food prices rising above inflation.
In the future, farmers and agricultural companies will be forced to defend themselves against allegations that their crop and fuel production is damaging the environment.
“We all will be forced to” prove that grain for fuel and the fuel itself are produced in a sustainable manner, Schumacher said.
“We all are preparing ourselves to prove that the feedstock we are using for biodiesel … is being produced in a sustainable manner.”
Some might be tempted to abandon hopes for the biofuel industry, considering the intense scrutiny of the environmental dangers of biofuel and increasing sensitivity to the possibility that biofuel demand will raise food prices.
But Schumacher said that doesn’t make any more sense than giving up genetically modified crop development because of the controversy surrounding it.
What the grain industry needs to do is find a way to produce fuel with crops. Ideally, it will not make food prohibitively expensive for consumers.
Schumacher said the world should be able to provide enough grain for food, feed and fuel but only under the right conditions:
- Farmers need a price incentive to boost grain and oilseed production, which means crop prices need to be higher than they have often been in the past.
- The full gains of technologies such as genetic modification need to be embraced to produce the extra crops required for future needs.
- New land must be brought into production but only land that can be sustainably farmed. New grain transportation, distribution and processing systems need to be built to bring extra supplies to market.
- Governments need to continue offering incentives for biofuel production so it can expand and mature as an industry.
- Governments can’t impose environmental rules on the biofuel industry that aren’t imposed on other industries.
- Trade liberalization needs to continue so that market signals are sent and received in a way that best maximizes production and employs the world’s resources most effectively.
Schumacher said the environmental sustainability debate has only just begun, so the grain industry needs to be prepared to deal with it. After the present economic problems are solved, those issues will likely arise again.
The industry needs to realize that this debate will be more intense than the one over GM crops, he added.
