A leaked report by the World Bank, purportedly confirms that biofuels, not increased demand from India and China, has caused the world’s food prices to increase by 75%.
President Bush has linked higher food prices to higher demand from India and China, but the leaked World Bank study disputes that: “Rapid income growth in developing countries has not led to large increases in global grain consumption and was not a major factor responsible for the large price increases
The news also suggests that the report was finished back in April, but was held back:
It all sounds to corny to me, hehehe….
In its annual report, the Red Cross warned of a possible surge in “food-related violence” due to soaring food prices. It suggests that several factors are contributing to the rise is prices:
Drought and climate change have led to a slow down in the growth of agricultural production: in Australia, wheat production plummeted by 52% between 2004 and 2006, and grain production dropped by 13% in the United States and 14% in the European Union in the same period. The use of mainly corn-based biofuels is also contributing significantly to the current shortages. Lastly, changes in eating habits in the West and in the so-called emerging markets primarily in Asia, along with rapid urbanization, have driven up demand for food, putting further strain on supply. Speculation on food commodities is also a major destabilizing factor.
There’s been a warning of food riots every month, from different sources. Sounds like things may destabilize in parts of the world by the end of the year.
An excellent article which reiterates the point, that food prices are going up, because of corn being diverted from human consumption to ethanol production.
Of course, the Iowa Corn Promotion Board will be right there saying it’s not their fault.
Iowa Corn Promotion Board and the Iowa Corn Growers Association are apparently going to launch a consumer-education campaign that says that they are not responsible for food prices going up.
I would partly agree, in that they are not entirely responsible. Of course oil prices, labor costs, transportation costs, etc share some of the blame. But the article ends by advocating the supposedly low extra cost of corn in order to reduce our dependance on foreign oil. [Gee thanks!! So what kind of gas guzzling truck do you drive? ] As more and more farmers switch to growing corn for biofuel rather than food production, food prices have to go up.
Ethanol producers in this country receive a tax credit of 51 cents a gallon, on top of billions of dollars in direct corn subsidies. (In 2005, the most recent year for which figures are available, it was $9 billion.) In Europe biodiesel subsidies can approach $2 a gallon.
Where does the feed for chicken, pigs, and cattle come from? If farmers can get more money for sending the corn to ethanol distilleries rather than food production facilities, the economics of supply and demand would dictate that food prices would go up. Corn is used everywhere. Less corn for everyday staples, means higher costs for everyday staples.
And as the National Corn Growers Association themselves say, “Ethanol production makes huge amounts of the nation’s corn disappear”.
Bagels are costing alot more these days. Why? Ethanol subsidies, paid for by our taxes, allow for grain, that normally go towards food and animal feed, to go to ethanol distilleries.
From ENS, “U.S. taxpayers, by subsidizing the conversion of grain into ethanol, are in effect financing a rise in their own food prices. It is time to end the subsidy for converting food into fuel and to do it quickly before the deteriorating world food situation spirals out of control. ”
All this while in Haiti, they’re literally eating dirt, because food prices have gone up.
Here’s a good read on why an increase in ethanol [derived from corn] to “reduce our dependency on foreign oil” is a bad idea for all…