AGROFUELS BAD NEWS: OXFAM

There is an ongoing debate about exactly how much the AGROfuels industries are impacting world food prices and aggravating world hunger. The AGROfuels industry associations point to inflated oil prices and the falling dollar as the main culprits.

A recent authoritative report from New Energy Finance (see BIOFUELS AND FOOD, BY THE NUMBERS) says AGROfuels are not the main part of the problem.

Another Inconvenient Truth; How biofuel policies are deepening poverty and accelerating climate change, a new report from OxFam UK, draws a different conclusion.

Economists are hard to wrestle with because when one hand is pinned, there’s the other hand. (As in "But on the other hand...") Still, Oxfam is on the front lines in the fight against world hunger. Its case deserves a hearing:

“The current biofuel policies of rich countries are neither a solution to the climate crisis nor the oil crisis, and instead are contributing to a third: the food crisis. In poor countries, biofuels may offer some genuine development opportunities, but the potential economic, social, and environmental costs are severe, and decision makers should proceed with caution.”

Oxfam’s report calls on “rich” countries to (1) freeze implementation of AGROfuels mandates and revise their targets; (2) dismantle subsidies and tax exemptions and stop import tariffs; and (3) deal with climate change and fuel security with measures that work like vehicle efficiency improvements.

Recognizing the importance to developing countries' economies of bioenergy programs, Oxfam calls on them to (1) choose bioenergy projects that are clean; (2) consider the long term costs as well as the short term benefits of bioenergy programs; (3) prioritize food supplies and food crops and (4) protect the rights and needs of “smallholders” in big development.

Oxfam: “The West’s biofuels boom is contributing to deeper global poverty and accelerated climate change, while allowing governments to avoid difficult but urgent decisions about how to reduce spiralling demand for energy in transport.”

From the Oxfam report. (click to enlarge)

Biofuels pushing 30 million into poverty
Pete Harrison (w/Christopher Johnson), June 25, 2008 (Reuters)

WHO
Oxfam UK

WHAT
Oxfam’s Another Inconvenient Truth; How biofuel policies are deepening poverty and accelerating climate change shows how AGROfuel industries in the developing world and AGROfuels subsidies in the industrial world conspire to aggravate a food crisis.

From the Oxfam report. (click to enlarge)

WHEN
- The World Bank estimates the price of food has gone up 83% in the last 3 years.
- Although most authorities believe greenhouse gas (GhG) emissions must peak and being falling by around 2020, it will take 167 years for land use from producing U.S. corn ethanol to balance the cost of its emissions.
- Oxfam estimates land use changes from palm oil-based fuels will by 2020 have caused 46 to 68 times the GhGs they will have saved by their use.
- The EU’s “10% biofuels by 2020” target can be expected $90 billion while providing fuel security worth only $12 billion.

WHERE
- The report looks carefully at soy biodiesel in the Brazilian Amazon region and the Brazilian Cerrado, sugarcane ethanol in the Brazilian Cerrado, palm oil biodiesel in the Indonesian lowland tropical rainforest and the Indonesian peatland tropical rainforest and corn ethanol in the U.S. central grasslands.
- There is a detailed case study of a village in Tanzania taking up the growing of Jatropha.
- The report looks at U.S., UK and EU policies affecting AGROfuel use including targets, subsidies and tariffs.
- It looks at world food prices and world hunger.

WHY
- The world’s poor spend 50% to 80% of their income on food. The implications of an 83% increase in cost over 3 years are almost too grim to ponder. 30% of the price increase is directly attributable to AGROfuels.
- Oxfam estimates the livelihoods of 290 million people are threatened. 100 million have already fallen into poverty.
- Oxfam says the rationales for AGROfuels development are 2 reduce greenhouse gas emissions and produce an economically competitive alternative liquid fuel source but AGROfuels do neither.
- It cites studies indicating they do little to cut emissions in the near term and may worsen global climate change beyond their ability to make it better.
- It cites studies to show there really isn’t enough agricultural production to significantly reduce petroleum dependence and it cites studies to show the cost of producing AGROfuels far outstrips the value of the energy they provide.

From the Oxfam report. (click to enlarge)

QUOTES
- Rob Bailey, biofuel policy advise/report author:"Rich countries' demands for more biofuels in their transport fuels are causing spiralling production and food inflation…Grain reserves are now at an all-time low."
- Report: "Biofuels are taking over agricultural land and forcing farming to expand into lands that are important carbon sinks, like forests and wetlands," the report said. "This triggers the release of carbon from soil and vegetation that will take decades to repay."
- Report: “So will second-generation biofuels have fewer adverse impacts on poverty and the environment? Although yields are likely to be higher, many second-generation technologies may still pose similar problems because they will depend on large-scale monocultures that threaten biodiversity, food production, or land rights. Just because a second-generation biofuel does not use food as a feedstock, it does not necessarily mean that it does not threaten food security: it may still compete with food for land, water, and other agricultural inputs.”