28th Oct 2016

Brussels blames part of food price rise on US biofuels policy

  • Trade commissioner Mandelson says that American biofuels policies are having a negative impact on global food prices (Photo: European Community, 2005)

EU trade commissioner Peter Mandelson has conceded that certain biofuel policies contribute to food price rises and increase greenhouse gas emissions, but that Europe's policies are sound.

Instead, Mr Mandelson has suggested that it is Washington's biofuels policies that are having these unwanted consequences.

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"We can already see that large-scale biofuel production, especially in the US, may be one of the factors pushing up food prices as it diverts resources from food production," said the commissioner, writing in UK daily the Guardian on Tuesday (29 April).

"The race to grow maize for ethanol subsidies in the US reduces the supply of food crops on world markets and drives up the cost of this important staple," he continued.

EU leaders last spring agreed that the EU should increase the use of biofuels in transport fuel to ten percent by 2020, up from a planned 5.75 percent target to be achieved by 2010.

But in recent months the target has come under strong fire with critics saying it is contributing to further poverty in already poor countries as land is cleared for biofuel production.

According to Mr Mandelson, European biofuel production is having "only a minimal effect" on global prices.

Quoting the soundbite green NGOs have been using in their multiple campaigns against biofuels over the last year, the commissioner wrote: "There are enough corn calories in an SUV fuel tank to feed a person for a year."

No social criteria

But he warned that any consideration of social questions amongst the criteria for allowing imports of biofuels would have much wider consequences for Europe's trade agenda.

"Why should we suggest there is an obligation on producers who export sugar cane biofuel, but not on those who export plain sugar cane?"

A trade official told the EUobserver that social questions cannot be included because they "can't be defended that at the WTO," and "in any case, taken to it's logical extreme, we would have to ensure that everything we import, not just biofuels, meet social criteria," he said. "Do we want that?"

"We have to ensure our thoughts are known in other ways, such as pushing our trading partners to sign up to International Labour Organisation standards."

The commission's agriculture spokesperson on Tuesday echoed the criticism of Washington's biofuels strategies.

"It would be wrong to claim, and no one has ever claimed that people in America growing a lot of corn for ethanol does not have an effect."

Nonetheless, he said: "It is not for us to tell the US what strategies and policies to have."

However, not all the commissioners have been singing from the same song sheet. Last week, development commissioner Louis Michel criticised biofuels as a "catastrophe" for food prices.

For his part, commission president Jose Manuel Barroso recently called for a study on whether there is any relationship between the increased food prices around the world and biofuels.

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