Biofuels to blame for 75 per cent increase in price of food
Biofuels have caused a 75 per cent increase in world food prices, a new report suggests.
The rise is far greater than previous estimates including a US Government claim that plant-derived fuels contribute less than three per cent to food price hikes.
According to reports last night, a confidential World Bank document indicates the true extent of the effect of biofuels on prices at a crucial time in the world’s negotiations on biofuel policy.
Rising food prices have been blamed for pushing 100 million people beneath the poverty line. The confidential report, based on a detailed economic analysis of the effect of biofuels, will put pressure on the American and European governments, which have turned to biofuels in attempts to reduce the greenhouse gases associated with fossil fuels and to reduce their reliance on oil imports.
The report says: “Without the increase in biofuels, global wheat and maize stocks would not have declined appreciably and price increases due to other factors would have been moderate.”
Next week leaders of the G8 industrialised countries meet in Japan to discuss what action needs to be taken to alleviate the food crisis. They will be lobbied by campaigners calling for a moratorium on the use of biofuels.
“Political leaders seem intent on suppressing and ignoring the strong evidence that biofuels are a major factor in recent food price rises,” said Robert Bailey, a policy adviser at Oxfam.
“It is imperative that we have the full picture. While politicians concentrate on keeping industry lobbies happy, people in poor countries cannot afford enough to eat.”
The World Bank report says that the US and EU’s drive to use more biofuels has had the most severe impact on food prices. Its argument goes against President George W Bush, who has claimed that an increased food demand from India and China has led to the price spiralling.
Since April, all petrol and diesel in Britain has had to include 2.5 per cent from biofuels.
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