No link between rising food prices and biofuels production - VDB

01 April 2011 17:49  [Source: ICIS news]

TORONTO (ICIS)--Germany’s biofuels trade group VDB said on Friday that there is no credible link between rising food prices and biofuels production, as biofuel crops account for only about 1.5% of global agricultural lands.

“The opposite is true, as we saw lower agricultural raw material prices in times of rising biofuels production, while prices actually rose in times when production of biodiesel and bioethanol fell,” VDB general manager Elmar Baumann said.

Baumann added that biofuels make a poor scapegoat for hunger and high food prices in developing countries.

He said the real causes for hunger in developing countries are poor government, poverty, a big gap between the poor and rich, and a lack of infrastructure.

In addition, Baumann said it is wrong for western countries to try to address the issue of hunger by dumping their agricultural surpluses on developing countries, as this will destroy markets for local farmers.

The general manager added that biofuel crops empower farmers with regards to global food companies, which give farmers an important market for their products.  

As such, it is no surprise that the food industry will try to blame biofuels when hiking its food prices, Baumann said.

He added that grain only accounts for 4.4% of the retail price of bread and therefore has only a slight influence on bread prices.

VDB’s reaction comes amid a renewed biofuels debate and a troubled launch of 10% bioethanol blended gasoline (E10) at Germany's pumps.

Last month, the president of the country’s chamber of commerce called on the government to review, and possibly end, subsidies to the biofuels industry in order to avoid a global food crisis.

In the US, federal subsidies for corn (maize) ethanol have been cited as a possible cause for the uprising in Egypt by driving food grains prices higher.

Check out Doris de Guzman’s Green Chemicals Blog for views on sustainability issues

By: Stefan Baumgarten
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