Australia: Ethanol ruling ‘to force up food’

ANALYSTS have warned that further food price rises are inevitable after the Queensland Government revealed almost half the ethanol to be blended in petrol used in motor vehicles in the state would come from grain.

Queensland will become the national leader in biofuel use after the Bligh Government yesterday pledged to press ahead with plans to require petrol to contain 5 per cent ethanol by 2010.

The Weekend Australian reported that Premier Nathan Rees had ditched the commitment by NSW to introduce the nation’s first mandated level of biodiesel and to boost the ethanol mandate from 2 to 10 per cent.

NSW was the first state to introduce a biofuels mandate last October.

Victoria and other states have gone cold on biofuels amid mounting evidence that taxpayer-subsidised mandates have contributed to growing world food shortages and rising prices. Up to 50,000 tonnes of grain a year are used for ethanol in NSW.

The Australian