Future food price hikes drive biofuel debate
It got a great boost recently when the Organisation for Economic Cooperation and Development (OECD) warned the cure might be worse than the cough in this instance.
It questioned the use of subsidies to the sector, which is starting to grow at an enormous rate.
This could be farm supports under a different name warned the OECD, whose aim is to support economic development.
Free trade across all economies is a major plank in its overriding philosophy and anything that smacks of subsidies is pretty much frowned upon.
It is another irony that these new energy alternatives, seen by many as the world’s first step away from total reliance on oil and gas, should stir up such a hostile reaction at this early stage.
It is a debate that could generate as much heat as the shift towards GM foods has done, a move that is still being strongly resisted in Ireland and elsewhere due to its unknown long-term impact on people’s health and the environment.
In the case of the new fuels, the OECD is not alone in raising concerns about the rush to this renewable energy source.
The US went to war in Iraq to secure its oil supplies — a desperate measure, not to mention the human cost involved.
By comparison the bio- fuel explosion is a much more civilised exercise, but that drive to find alternatives to oil and gas is not without trenchant critics.
Some have questioned the moral basis of the development. In addition to increasing the cost of food, those concerned about the fate of poorer countries have deep reservations.
It is accepted the sector is having an impact on the cost of commodities that go into the foods we eat, which also constitute up to 50% of animal feeds in some cases, corn for pig feed being a case in point.
These alternative energies are backed by most governments and could represent farmer subsidies under a different name, the OECD said. It also warned that the rush to develop the sector in Europe and the US could result in significant environmental damage by what are now being dubbed “first generation” alternative energy sources.
Just recently the United Nations jumped on board the debate on the renewable energy sector. Its Food and Agricultural Organisation warned production of such energy sources does add to the cost of foods because of the conflicting demands for key raw materials such as corn and other grains.
Dearer food prices will just make it more difficult on those in poorer countries to improve their lot, it said.
These are complex issues. Finding alternatives to oil and gas are vital pursuits that deserve the backing of governments.
Furthermore the switch to alternative energies is offering fresh hope to thousands of farmers — not just in Ireland but internationally — who thought their time in agriculture was rapidly coming to an end.
At this point there is no doubt that world grain prices are soaring and those increases mean dearer food in the years ahead.
Even as the world economy looks like slowing, the quest for better living standards is pushing up food consumption and dairy production in particular are finding it hard to keep up with demand.
The debate about the cost of food and the part being played by biofuels in this will continue. It was interesting, however, that the OECD in particular thought it important enough to go public on the biofuels issue.
It has denied any link between the new fuels and the massive hike in grain prices that have rocketed over the past 12 months. As food prices start to soar, however, this debate will hot up.
