|Source||News for Social Justice Activists|
|Biofuels Behind Food Price Hikes:
Leaked World Bank Report
AFP July 4, 2008
BIOFUELS HAVE CAUSED world food prices to increase by
75 percent, according to the findings of an unpublished
World Bank report published in The Guardian newspaper
The daily said the report was finished in April but was
not published to avoid embarrassing the US government,
which has claimed plant-derived fuels have pushed up
prices by only three percent.
Biofuels, which supporters claim are a "greener"
alternative to using fossil fuel and cut greenhouse gas
emissions, and rising food prices will be on the agenda
when G8 leaders meet in Japan next week for their
The report's author, a senior World Bank economist,
assessed that contrary to claims by US President George
W. Bush, increased demand from India and China has not
been the cause of rising food prices.
"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 report said.
Droughts in Australia have also not had a significant
impact, it added. Instead, European and US drives for
greater use of biofuels has had the biggest effect.
The European Union has mooted using biofuels for up to
10 percent of all transport fuels by 2020 as part of an
increase in use of renewable energy.
All petrol and diesel in Britain has had to include a
biofuels component of at least 2.5 percent since April
"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," the report said.
It added that the drive for biofuels has distorted food
markets by diverting grain away from food for fuel,
encouraging farmers to set aside land for its
production, and sparked financial speculation on
But Brazil's transformation of sugar cane into fuel has
not had such a dramatic impact, the report said.
"The basket of food prices examined in the study rose
by 140 percent between 2002 and this February," The
"The report estimates that higher energy and fertiliser
prices accounted for an increase of only 15 percent,
while biofuels have been responsible for a 75 percent
jump over that period."