The debate over whether biofuels are a major factor in rising food prices lugged on this week, with the Bush administration for the first time acknowledging there may be some truth to this.
Secretary of State Condoleezza Rice on Monday indicated there have been some unforeseen consequences in the push for biofuels as land previously used for food crops is diverted to biofuel crop production. She did qualify that this is only one of many contributing factors, however. " ….Everything from fertilizer to transportation costs is bringing on our ability to distribute or to get food to people, and then associated with that there has been apparently some effect - unintended consequences - from the alternative fuels effort," Rice said at a Washington press conference. This latest development in the biofuels issue lends credence to the argument that crops should not be diverted towards other uses at a time when food security is at risk. Rice was cautious in her use of terms, but hinted that the government - while it is still in power - will keep a closer watch on the effect of biofuels. "Although we believe that, while biofuels continue to be an extremely important piece of the alternative energy picture, obviously we want to make sure that it's not having an adverse effect," said Rice. Meanwhile, on Tuesday, President George W Bush did not answer a reporter's questions with the same opinion or candor as Rice, but did urge for both domestic fuel and food auto-sufficiency. "…The high price of gasoline is going to spur more investment in ethanol as an alternative to gasoline," said Bush. "And the truth of the matter is it's in our national interests that our farmers grow energy, as opposed to us purchasing energy from parts of the world that are unstable or may not like us." Government subsidies have fueled corn-based ethanol production in the US. According to the US Department of Energy, the number of ethanol plants more than doubled in the US between 2000 and 2007, while production tripled over the same period. US Department of Agriculture (USDA) statistics indicate the country' ethanol capacity in 2006 was 4.4 billion gallons with growth projections of 7 billion gallons for 2010, which critics say will be achieved to the detriment of food needs. When pushed on this issue, Bush somewhat eluded the question at a White House press conference Tuesday. "The World Bank says about 85 percent of the increase in corn price since 2002 is due to biofuel - increased demand for biofuels. And your Secretary of State said that - Indicated yesterday that she thought that might be part of the problem. Do you agree with that?" asked a reporter. "Actually, I have a little different take: I thought it was 85 percent of the world's food prices are caused by weather, increased demand and energy prices - just the cost of growing product - and that 15 percent has been caused by ethanol, the arrival of ethanol," answered Bush. In fact, it appears neither of these interpretations is correct. In its report Rising food prices: Policy options and World Bank response, the international lender does not actually attribute an exact percent or figure for how much biofuels have contributed to the food crisis, but instead said overall yields were increased so as to supply biofuels. "Almost all of the increase in global maize production from 2004 to 2007 (the period when grain prices rose sharply) went for bio-fuels production in the US ….," states the report. "Only a relatively small share of the increase in food production prices (around 15 percent) is due directly to higher energy and fertilizer costs." Also speaking Tuesday, agriculture secretary Ed Shafer said the use of food crops for biofuels - in this case corn for ethanol production - is only a "stepping stone" on the way to more efficient or available non-food plant or waste sources. He said market forces will determine what works best. At the White House briefing, Bush suggested buying locally and producing locally as a means of meeting the fuel and food crisis. "One thing I think that would be - I know would be - very creative policy is if we would buy food from local farmers as a way to help deal with scarcity, but also as a way to put in place an infrastructure so that nations can be self-sustaining and self-supporting," said the president. "It's a proposal I put forth that Congress hasn't responded to yet, and I sincerely hope they do."