Corn ethanol could hurt poor's food security; other biofuels can strengthen it
The push toward corn-based ethanol has the potential to starve millions around the world, two economists from the University of Minnesota say.
The demand for ethanol has pushed corn prices to record highs, and economists C. Ford Runge and Benjamin Senauer, writing in the May/June issue of Foreign Affairs magazine, warn that the rise in prices will likely hurt the world's poor.
Energy efficiency should be the Bush administration's mantra, they say, adding that the drive toward ethanol should be tempered until it can be produced efficiently from cellulosic material.
"Resorting to [corn based] biofuels is likely to exacerbate world hunger," they write in Foreign Affairs. "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."
In a 2003 study, the two professors showed that given rates of economic and population growth, the number of hungry worldwide would fall by 23 percent, to about 625 million, by 2025, as long as agricultural productivity improved enough to keep the relative price of food constant. But the rise in the price of foodgrains because of the increased demand for biofuels could lead to more hungry people the world over.
"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 write. "That means that 1.2 billion people could be chronically hungry by 2025 -- 600 million more than previously predicted."
Although much of the corn used in the United States is not for human but animal consumption, the demand for ethanol has pushed farmers to grow more corn at the expense of other crops, leading to high poultry and related prices:
biomass :: bioenergy :: biofuels :: energy :: sustainability :: ethanol :: corn :: food security :: developing countries ::
The conclusion should be obvious: like the United Nation's Food and Agriculture Organisation says, let the poor themselves produce biofuels. There is enough land available in countries often plagued by food insecurity. What these countries need is financial and agronomic inputs, and market access. If these conditions are met, poor farmers in the tropics and subtropics can lift themselves out of poverty and food insecurity by selling biofuels to local and international markets.
Moreover, the effect of high fossil fuel prices and energy insecurity is devastating to the development of the world's poorest economies. A switch to competitive biofuels may temper these effects and save funds that can be invested in social and rural development and in poverty alleviation. In many cases, if a developing country in the tropics and subtropics does not create a biofuels industry, it will lose huge amounts of money on importing expensive fossil fuels.
Economists from the International Energy Agency has clearly shown the strict correlation between Human Development (as defined by the UN) and energy security.
More information:
C. Ford Runge and Benjamin Senauer, How Biofuels Could Starve the Poor, Foreign Affairs, May/June 2007
Biopact: ICRISAT launches pro-poor biofuels initiative in drylands - March 15, 2007
IEA: World Energy Outlook, 2004 [*.pdf] [see Chapter 9, entirely devoted to "Energy and Development", one of the best introductions to the subject].
Biopact: Biofuels can cut poverty, provide energy and mitigate climate change – UN, April 14, 2005
The demand for ethanol has pushed corn prices to record highs, and economists C. Ford Runge and Benjamin Senauer, writing in the May/June issue of Foreign Affairs magazine, warn that the rise in prices will likely hurt the world's poor.
Energy efficiency should be the Bush administration's mantra, they say, adding that the drive toward ethanol should be tempered until it can be produced efficiently from cellulosic material.
"Resorting to [corn based] biofuels is likely to exacerbate world hunger," they write in Foreign Affairs. "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."
In a 2003 study, the two professors showed that given rates of economic and population growth, the number of hungry worldwide would fall by 23 percent, to about 625 million, by 2025, as long as agricultural productivity improved enough to keep the relative price of food constant. But the rise in the price of foodgrains because of the increased demand for biofuels could lead to more hungry people the world over.
"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 write. "That means that 1.2 billion people could be chronically hungry by 2025 -- 600 million more than previously predicted."
Although much of the corn used in the United States is not for human but animal consumption, the demand for ethanol has pushed farmers to grow more corn at the expense of other crops, leading to high poultry and related prices:
biomass :: bioenergy :: biofuels :: energy :: sustainability :: ethanol :: corn :: food security :: developing countries ::
The conclusion should be obvious: like the United Nation's Food and Agriculture Organisation says, let the poor themselves produce biofuels. There is enough land available in countries often plagued by food insecurity. What these countries need is financial and agronomic inputs, and market access. If these conditions are met, poor farmers in the tropics and subtropics can lift themselves out of poverty and food insecurity by selling biofuels to local and international markets.
Moreover, the effect of high fossil fuel prices and energy insecurity is devastating to the development of the world's poorest economies. A switch to competitive biofuels may temper these effects and save funds that can be invested in social and rural development and in poverty alleviation. In many cases, if a developing country in the tropics and subtropics does not create a biofuels industry, it will lose huge amounts of money on importing expensive fossil fuels.
Economists from the International Energy Agency has clearly shown the strict correlation between Human Development (as defined by the UN) and energy security.
More information:
C. Ford Runge and Benjamin Senauer, How Biofuels Could Starve the Poor, Foreign Affairs, May/June 2007
Biopact: ICRISAT launches pro-poor biofuels initiative in drylands - March 15, 2007
IEA: World Energy Outlook, 2004 [*.pdf] [see Chapter 9, entirely devoted to "Energy and Development", one of the best introductions to the subject].
Biopact: Biofuels can cut poverty, provide energy and mitigate climate change – UN, April 14, 2005
2 Comments:
I would think that the incidence of hunger among the world's poor would be as closely aligned with the cost of oil as the cost of corn in Mn.
I'm suspicious of articles that overlook this obvious factor; and, I start wondering about the "funding."
Well, we happen to agree with this basic idea: the price of oil is ultimately to blame.
Consider what would happen without reliance on biofuels which are currently cheaper than petroleum? (Brazilian ethanol costs US$35 to US$40 per boe to produce - that is: US$ 25 to US$ 30 less than crude oil). Energy would become even more expensive.
There is a very large body of socio-economic research showing that energy scarcity and costly energy are extremely detrimental to both the economy of a country, as well as to its poorest people.
Lack of energy and costly energy stalls development, pushes up inflation and increases poverty (and ultimately food insecurity).
What are the alternatives to biofuels? Solar and wind? Obviously not, because they are far more expensive and they cannot be used for transport.
People should dig deeper and go beyond the simplistic notion that biofuels automatically mean increased poverty. Basically the contrary is true: biofuels can save scarce funds for poverty alleviation in developing countries, because they offset the need for imports of costly fossil fuels.
The matter is way to complex to be handled by the average journalist.
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