'Biofuels' Hard Choice: Want Food or Fuel?

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It's been just over two year ago that Georges Monbiot warned us of the dark side of an apparently good idea: replacing petroleum based fuels with others based on bio-mass. My article reporting on this drew some critical comments, but the initial fears seem to be borne out now as we are getting closer to implementing the biofuel option.

In May 2005, US president Bush urged widespread adoption of both biodiesel and ethanol production from agricultural products, as part of a strategy to reduce US dependence on oil imports. What he apparently didn't consider were the knock-on effects of such a strategy on food prices and ultimately on the ability of agriculture to assure a supply of plentiful, affordable food for all.

Mae-Wan Ho of the Institute for Science in Society warns in a recent article titled Biofuels: Biodevastation, Hunger & False Carbon Credits
that Europe’s thirst for biofuels is fuelling deforestation and food price hikes, exacerbated by a false accounting system that awards carbon credits to the carbon profligate nations. She adds that "a mandatory certification scheme for biofuels is needed to protect the earth’s most sensitive forest ecosystems, to stabilise climate and to safeguard our food security."

Tom Philpott, in an article published by Grist magazine takes the discussion further, showing that a relatively small move towards biofuels in the US has been doubling the price of corn in the space of a year, as the grain becomes a sought-after raw material for ethanol to be added to gasoline.

What the concerns expressed on both sides of the Atlantic show is that biofuels may be far from the magic solution to our energy problems we are looking for. We should direct our attention and support to real new energy inventions. These new technologies under development by an army of private inventors and tinkerers are without public funding and there is little interest in real breakthroughs. Yes, there are some potentially disruptive technologies out there waiting for their day. They could easily upset the billion-dollar fossil fuel energy interests as they are coming into play. But come they will, with or without public funding.

In addition to the more conventional alternatives such as solar, wind and tidal power, there are promising developments on fuelless technologies that tap the energy potential provided by magnets as well as unconventional chemical and nuclear reactions.

If you're interested in following developments in these emerging energy technologies, there is a great site to bookmark and keep track of by getting their "Daily FE_Updates". There is also a Free energy Wiki which allows anyone to contribute with the accumulation and sorting of information about new energy developments.

But perhaps you want to first get a whiff of the pitfalls of using agricultural biomass for fuel production, which Tom Philpott has exposed in his article Feeding the Beast:

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Feeding the Beast
It's time for a real "food vs. fuel" debate
By Tom Philpott
13 Dec 2006

(see the original here for more links)

Can U.S. farmers keep filling the nation's bellies as they scramble to fuel its cars?

Given its evident gravity, the question has drawn remarkably little debate. Like it or not, though, more and more food is being devoted to fueling the nation's 211-million-strong auto fleet. High gasoline prices, a dizzying variety of government supports, and an investment frenzy have caused corn-based ethanol production to more than triple since 1998.

As recently as a year ago, corn seemed wildly overproduced. Suddenly, it's a hot commodity. In 1998, about 5 percent of the corn harvest (526 million bushels) went into ethanol production, according to the National Corn Growers Association. This year, the U.S. Department of Agriculture expects ethanol producers to use upward of 2 billion bushels, or nearly 20 percent of the crop.

And ethanol's voracious appetite for corn isn't expected to abate anytime soon. According to the pro-ethanol Renewable Fuels Association, 109 ethanol refineries currently churn out 5.3 billion gallons of ethanol a year -- and an additional 56 plants (plus expansions at seven existing ones) have broken ground. When these new plants are on line, the industry's capacity will nearly double, to 9.7 billion gallons a year.

Presumably, its demand for corn will nearly double, too -- and that means higher food prices for consumers.

Corn Hits a 10-Year High

For most of the past five years, steadily rising ethanol demand has had little effect on corn prices. Bolstered by generous subsidies, corn farmers churned out more than enough product to satisfy demand from ethanol plants while holding prices steady.

This year, though, after the gasoline industry abruptly abandoned MTBE and embraced ethanol as an oxygenate enhancer, ethanol demand spiked, and the price of corn finally followed suit. A bushel of corn currently fetches about $3.45 -- a 10-year high that leaves last year's low of $1.50 in the dust.

Considering that corn suffuses the U.S. food system -- it's the main feed for beef, poultry, egg, dairy, and hog production, and provides sweetness for candy, cereal, soft drinks, and other supermarket staples -- its price can't suddenly jump without causing repercussions. In the early 1970s, a sudden spike in grain prices quickly upped the cost of meat, making it a luxury even for many middle-class families. (Hamburger Helper, anyone?)

Tyson Foods, the world's largest meat and poultry processor, has already signaled that a similar scenario might be on the way now. "I believe the American consumer is going to have to pay more for protein," Tyson CEO Richard L. Bond recently told investors. "Quite frankly, the American consumer is making a choice here ... either corn for feed or corn for fuel."

Elsewhere, The Wall Street Journal recently explained succinctly why poultry prices will soon reflect corn's new popularity as a fuel source. Because of higher corn prices, "It costs nearly a nickel more to produce a pound of chicken today than at the end of 2005, yet the 20-year average industry profit margin per pound of chicken is two cents. This means poultry producers either will have to raise prices or slash other costs."

It should be noted that any farmer who has survived the last 20 years in the poultry business has already slashed costs to the bone; higher prices seem inevitable. And adding a nickel a pound for whole chickens at the farm level will ripple up the food system, translating to higher increases on the supermarket shelf.

The Boom Heard 'Round the World

While the industrial-food system is easy to criticize, it's important to recognize that vast numbers of people rely on it for cheap sustenance. For more than 30 years, real growth in average wages has, at best, floundered. According to University of Massachusetts economist Robert Pollin's Contours of Descent: The Economic Consequences of Clinton, Bush, and Greenspan, real hourly wages peaked at $15.73 in 1973 and by 2000 stood at $14.15 (in 2001 dollars). And that was after a rare three-year growth spurt provoked by the stock-market bubble; since 2000, wages have essentially flatlined.

Not surprisingly, tens of millions face what the USDA calls "food insecurity," which the agency defines as the condition of households being "uncertain of having, or unable to acquire, enough food to meet the needs of all their members because they had insufficient money or other resources for food."

In that context, the federally funded effort to divert billions of bushels of corn into ethanol with scant public debate seems cavalier.

Moreover, the pattern of booming biofuel production driving up feedstock prices is also taking root in developing countries -- where, the U.N. Food and Agriculture Organization claims [PDF], some 800 million people face persistent hunger and malnutrition.

In a blunt report last week, The Wall Street Journal vividly illustrated the effect of booming European demand for biodiesel on Southeast Asian palm-oil production. Prices for the tropical fat have jumped more than 30 percent in 2006, spurring rapid deforestation as landowners scramble to plant more palm, the Journal reports.

Meanwhile, Brazil's successful sugarcane ethanol program has inspired copycats -- and a rally in sugar prices. Sugar prices recently came off 25-year highs, but that's only because growers in other areas are scrambling to plant cane and thus increase supply. According to the Journal, "In India, environmental activists say, water tables are dropping as farmers try to boost production of ethanol-yielding sugar."

Deforestation, falling water tables -- these are hardly the hallmarks of a fuel source that can reasonably be called "renewable," much less an agriculture strategy designed to maintain food-production capacity. And rising prices for food commodities, without other social reforms, will only translate to more misery for the global south.

Already, the FAO is sounding the alarm. The agency claims that world grain prices are at ten-year highs in part because of "fast-growing demand for biofuel production." These high prices, the FAO warns, cause "dismay [for] many developing countries that rely on the international market to meet their staple food needs," many of which will "reduce food purchases, not always in response to their own improved domestic supplies but rather because of the high international prices."

Covering Every Inch

Here in the United States, cellulosic ethanol, which could theoretically utilize non-food crops such as switchgrass, is often held up as the panacea for a truly green biofuel that needn't have much effect on food prices.

Yet the process for extracting sugars from cellulose remains, 30 years since the government first started investing in research for it, just beyond the grasp of viable commercial-scale production. USDA chief ec