Biofuels vs. Fuel: Don’t Get Lost in the Maze

Biofuel production has come under blistering attack as food prices around the world escalate. This week, Thai Prime Minister Samak Sundaravej responded to comments from IMF and World Bank officials condemning the diversion of food crops to biofuels: “Let me ask the World Bank whether they used to ask oil exporting countries before pointing their fingers and blaming us that we have to use rice fields to grow biofuel crops….They have unreasonably continued to inflate oil prices even though the oil supply is not running out yet” (via Biofuels Digest). Biofuels are part of the problem, but increases in production account for only a portion of the increase in food costs.

The factors are manifold, but one is certainly the cost of energy: agricultural production costs and food transportation costs have increased with the rising cost of oil. Nathanael Greene at NRDC adds to the list of reasons: increasing demands for food in fast-growing nations, the adverse impact of droughts and extreme weather on key producing regions, and problematic international trade policies (more on the U.S.’s own Farm Bill).

In addition to disentangling some of the causes of rising food prices, Greene points out some additional problems with the current arguments: they distract discussion from other policy measures that will have greater impacts on alleviating world hunger, and they can lead back to subsidized overproduction, which is unsustainable from an environmental and economic standpoint:

While I worry that the current mud-fight over food vs. fuel will lead to dangerously blunt policies that would throw out the biofuels baby with the bath water, I worry more that the mud-fight will distract us from doing something serious about world hunger. The argument that we should address the starvation being caused by current high prices through minimizing the production of biofuels from food crops is wrong and distracts us from the real solutions. This argument is basically calling for addressing world hunger by encouraging overproduction here in the U.S. (Less corn ethanol means more supply, more supply means lower prices — or so the argument goes.) But overproduction in developed countries comes at a high cost to our environment, to farmers around the world, and ultimately to the economies of the countries with the most hungry. Subsidized overproduction and the resulting cheap food does trickle down to feed more people, but it’s not sustainable — nor is it the most effective way to feed the poor.

The way forward on biofuels is complicated, but we can’t make the right steps if we’re arguing about the wrong things.

Tags: biofuels

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