kevinsmith
04-03-2007, 08:45 PM
This is interesting, never thought of this. I always thought of this solution as one of the better ones.
WASHINGTON (AFP) - The boom in ethanol fuels in the United States and elsewhere could have devastating effects on food prices and worsen world hunger, a new study argues.
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The study by C. Ford Runge and Benjamin Senauer of the University of Minnesota said the rush into ethanol threatens to divert massive amounts of corn and other food crops into biofuels.
The researcher write in the May/June edition of Foreign Affairs that governments should stop incentives for ethanol until biofuels can be economically produced from sources other than corn and soybeans.
"Resorting to biofuels is likely to exacerbate world hunger," they said. "Several studies by economists at the
World Bank and elsewhere suggest that caloric consumption among the world's poor declines by about half of one percent whenever the average prices of all major food staples increase by one percent."
The researchers said the surge in energy prices along with subsidies and incentives given by governments has pushed farmers into diverting massive amounts of corn, oilseeds and other crops into ethanol.
In the US, this affects corn, but in Brazil it involves sugar cane and in Africa cassava.
"If, all other things being equal, the prices of staple foods increased because of demand for biofuels, the number of food-insecure people in the world would rise by over 16 million for every percentage increase in the real prices of staple foods," they wrote.
"That means that 1.2 billion people could be chronically hungry by 2025 -- 600 million more than previously predicted."
They said the biofuel craze could push up corn prices 20 percent by 2010 and 41 percent by 2020. This could affect other crops such as rice or wheat, since farmers are converting their fields to corn or other plants more profitable because of their potential for ethanol.
"In the United States, the growth of the biofuel industry has triggered increases not only in the prices of corn, oilseeds, and other grains but also in the prices of seemingly unrelated crops and products," they said.
"The use of land to grow corn to feed the ethanol maw is reducing the acreage devoted to other crops. Food processors who use crops such as peas and sweet corn have been forced to pay higher prices to keep their supplies secure, costs that will eventually be passed on to consumers."
The authors said the ethanol market is further distorted by subsidies that make diversion of crops even more profitable.
"Rather than promoting more mandates, tax breaks, and subsidies for biofuels, the US government should make a major commitment to substantially increasing energy efficiency in vehicles, homes, and factories; promoting alternative sources of energy, such as solar and wind power; and investing in research to improve agricultural productivity and raise the efficiency of fuels derived from cellulose," the authors said.
WASHINGTON (AFP) - The boom in ethanol fuels in the United States and elsewhere could have devastating effects on food prices and worsen world hunger, a new study argues.
ADVERTISEMENT
The study by C. Ford Runge and Benjamin Senauer of the University of Minnesota said the rush into ethanol threatens to divert massive amounts of corn and other food crops into biofuels.
The researcher write in the May/June edition of Foreign Affairs that governments should stop incentives for ethanol until biofuels can be economically produced from sources other than corn and soybeans.
"Resorting to biofuels is likely to exacerbate world hunger," they said. "Several studies by economists at the
World Bank and elsewhere suggest that caloric consumption among the world's poor declines by about half of one percent whenever the average prices of all major food staples increase by one percent."
The researchers said the surge in energy prices along with subsidies and incentives given by governments has pushed farmers into diverting massive amounts of corn, oilseeds and other crops into ethanol.
In the US, this affects corn, but in Brazil it involves sugar cane and in Africa cassava.
"If, all other things being equal, the prices of staple foods increased because of demand for biofuels, the number of food-insecure people in the world would rise by over 16 million for every percentage increase in the real prices of staple foods," they wrote.
"That means that 1.2 billion people could be chronically hungry by 2025 -- 600 million more than previously predicted."
They said the biofuel craze could push up corn prices 20 percent by 2010 and 41 percent by 2020. This could affect other crops such as rice or wheat, since farmers are converting their fields to corn or other plants more profitable because of their potential for ethanol.
"In the United States, the growth of the biofuel industry has triggered increases not only in the prices of corn, oilseeds, and other grains but also in the prices of seemingly unrelated crops and products," they said.
"The use of land to grow corn to feed the ethanol maw is reducing the acreage devoted to other crops. Food processors who use crops such as peas and sweet corn have been forced to pay higher prices to keep their supplies secure, costs that will eventually be passed on to consumers."
The authors said the ethanol market is further distorted by subsidies that make diversion of crops even more profitable.
"Rather than promoting more mandates, tax breaks, and subsidies for biofuels, the US government should make a major commitment to substantially increasing energy efficiency in vehicles, homes, and factories; promoting alternative sources of energy, such as solar and wind power; and investing in research to improve agricultural productivity and raise the efficiency of fuels derived from cellulose," the authors said.