Ethanol derived from corn, sugar and other crops is fueling a debate over how a plant-guzzling future will affect food and the world’s undernourished poor.
Global food and agriculture experts fear that as more countries turn to crops as an energy source, spurred by worries of global warming and oil dependency, food prices could go up and out of the reach of the very poor.
President Bush is serious in his promotion of the use of biofuels, as a way of lessening U.S. energy dependence and helping the environment.
“Your capacity to make biofuels and our desire to use biofuels will make an interesting match as we work to become less dependent on oil and better stewards of the environment,” Mr. Bush said in February at a White House meeting with Panamanian President Martin Torrijos.
He said he is committed to introducing $35 billion worth of biofuels into the U.S. market within the next 10 years.
“If you’re dependent upon oil from overseas, you have a national-security issue,” Mr. Bush said in March after touring a biofuels depot in Sao Paulo, Brazil. “In other words, dependency upon energy from somewhere else means that you are dependant upon the decision from somewhere else.”
Others call biofuels a plot against the world’s poor because it depletes the supply of cheap grain.
However, most agree the situation is not as bleak as “the sinister idea of converting food into fuel,” as Cuban President Fidel Castro said in a March editorial written for Granma, the newspaper of the Cuban Communist Party.
In the right circumstances, higher food prices resulting from widespread ethanol production could prove beneficial, rather than devastating, to the developing world’s impoverished masses. Which way things go depends largely on how the technology advances and what policies countries adopt as they strive to promote and protect their own bio-energy industries.
“The debate is very complicated. No matter how it’s portrayed, it should be portrayed as a complex problem,” said Raya Widenoja, a biofuels researcher with the Worldwatch Institute.
The global output of ethanol increased 20 percent, to 13.5 billion gallons annually, from 2004 to 2006, according to the Renewable Fuels Association, a U.S. trade group.
With vast growth ahead — the United States aims to be producing about 35 billion gallons in 10 years — governments around the world are hoping to turn farming into a domestic energy industry.
“Biofuel development presents a tremendous opportunity for many economies, including energy-poor economies and poor farmers,” said Josette Sheeran, director of the U.N. World Food Program (WFP), in an Aug. 1 speech at Washington’s Cosmos Club. “But on the immediate horizon, the world’s most vulnerable are faced with the challenge of rising food costs and the tightest grain markets in memory.”
The WFP and other aid agencies are also feeling the squeeze, because they buy the food they use for emergency famine relief on the open market, said Siwa Msangi, a researcher at the International Food Policy Research Institute.
Although most Americans grumble when the price of bread or milk increases, they spend the money anyway. But the millions of people who scrape by on a dollar or two a day simply can’t afford to.
For people living in poverty, the general rule is that with each one percent increase in the cost of food staples, they have to cut back 0.7 percent on their consumption, Mr. Msangi said.
Mr. Msangi and his colleagues projected that even with aggressive improvements in biofuel technology, the world price of corn could increase 23 percent by 2020. The price of cassava — a major staple in sub-Saharan Africa, Asia and Latin America — could increase 54 percent, potentially leading to serious problems with malnourishment among those who don’t grow their own food.
Economists caution that biofuel demand is not the chief culprit behind the current high prices of food in the U.S. and the world. Instead, global energy prices, which have been rising for the past few years, are swelling food prices. Conventional energy is required across the spectrum of food production — in growing, processing, transporting and refrigerating it.
However, ethanol could pose a problem as governments issue legal mandates requiring biofuels to be a certain percentage of all fuels, because such rules would keep demand high, even if oil prices were to fall again, said Merritt Cluff of the Food and Agriculture Organization of the United Nations.
“High percentage mandates could considerably drive up commodity prices,” he wrote in an e-mail.
If poor farmers are to benefit from biofuels, experts say they will need investment from their governments in infrastructure and farming equipment. With the potential value of farm labor increasing, they will also require labor laws that prevent exploitation.
Every country trying to encourage a domestic ethanol industry should be careful about how it subsidizes and regulates producers, so big companies don’t edge out individual farmers, Ms. Widenoja said. “If the industry develops so there are just a couple corporations controlling a lot of land, there won’t be a lot of benefit to the poor.”
At the same time, developing countries will need help from major agricultural producers such as the United States and European Union members in the form of less protectionist policies.
“When energy policy starts to look a lot like agricultural support policy, that’s when analysts get worried,” Mr. Msangi said, referring to the subsidies, tax credits and tariffs enjoyed by U.S. corn growers and ethanol producers.
Washington could help encourage production in other countries by lowering its 54-cents-a-gallon tariff on imported ethanol, which would free up the huge U.S. market to foreign sellers, Ms. Widenoja said.
Maybe more than anything else, the future of biofuels will depend on how the technology to transform plant life into fuel improves — what experts refer to as “second-generation” technology.
Today, most commercially viable processes create ethanol from the starch and sugar found in common crops such as corn, sugarcane and sorghum, or from vegetable oil, in the case of biodiesel.
Although ethanol burns cleaner than traditional gasoline and yields more energy, many experts think the environmental gain, particularly of corn-based ethanol, is negligible. This is because more chemical fertilizers and pesticides, as well as more land, will be devoted to agriculture as ethanol continues to boom.
Because humans consume starch and sugar, these types of ethanol also pose the greatest threat to food prices.
Second-generation biofuels, which rely on the cellulose found in green plants, could change much of that once scientists learn how to convert it more efficiently into fuel. While yielding more energy than starch or sugar, cellulose has the added benefit of not competing with food, because it is found in the inedible parts of plants.
“It may use waste more efficiently,” Mr. Cluff said.
This is at least the hope of those who see the United States’ strong support of corn-based ethanol as having potential repercussions on the world food market.
If the technology for cellulosic ethanol becomes cheap and efficient enough, U.S. farmers could keep corn in the food market while giving the husks and stalks to ethanol producers, said Matt Hartwig, a spokesman for the Renewable Fuels Association.
“That’s why our industry is looking to new technologies,” he said. “We certainly recognize the limits of a grain-based ethanol industry.”