Africa: Biofuel-Chasing EU Puts Pressure On Grains Supply

The decision by the European Union not to review its controversial biofuel consumption targets is expected to pile more pressure on the critically low global cereal stocks, analysts said.

A new climate change plan released by the EU indicates that Europe remains committed to switching 10 per cent of all transport fuel to biofuels by 2020.
The target was first set in March last year but growing criticism of the environmental impact of biofuels and their threat to food security had raised expectations that it would be revise.

Rising production of corn and sugar-based ethanol has been partly blamed for the recent rise in prices of major crops like wheat, corn and edible oils. The United States, the world’s biggest corn exporter, increased the area under maize cultivation by 18 per cent last year, partly to meet ethanol demand.

That is said to have reduced the area under cultivation for other food crops. Food experts said that if EU biofuel targets and those of other countries such as the US are achieved, food prices will rise much more, threatening the future supply of major importers, including much of Africa.

Last week the EU’s environment commissioner Stavros Dimas admitted in a BBC interview that the 27-nation bloc had underestimated the danger to rainforests and the risk of forcing up food prices from its policy of setting targets for the use of biofuels.

“We have seen that the environmental problems caused by biofuels and also the social problems are bigger than we thought they were. So we have to move very carefully,” he told the BBC.

His admission was followed this week by a UK government report concluding that biofuels are generally “an expensive and ineffective way” to cut greenhouse gas emissions when compared to other policies.

It also stressed that producing first generation biofuels, such as those made from sugar, corn or palm oil, were likely to cause increasing food prices and insecurity.

Researchers at the International Food Policy Research Institute in Washington warned in December that if current plans for biofuel production by leading producers like the EU and US are achieved, corn prices will increase by 26 per cent by 2020.

If however biofuel production exceeds those targets, prices could go up by as much as 72 per cent.

AllAfrica