Worldwatch Institute: biofuels may bring major benefits to world's rural poor

The increase in world agriculture prices caused by the global boom in biofuels could bring major benefits to the world’s rural poor who have been suffering under low prices for decades, according to the Worldwatch Institute. This is a conclusion of a major study titled Biofuels for Transport: Global Potential and Implications for Energy and Agriculture, co-ordinated by the German Agency for Technical Cooperation and published by Earthscan this week.

If implemented in smart ways on the basis of strong policies, hundreds of millions of the world's poorest people, the majority of whom live in rural areas, stand to benefit massively from the global biofuel transition, which will result in reduced food insecurity and increased incomes. The report confirms many previous scientific assessments on the poverty alleviating potential of bio-based energy and products, and strengthens the Biopact's case further.

Decades of declining agricultural prices have been reversed thanks to the growing use of biofuels. Rural farmers in some of the poorest nations have been decimated by U.S. and European subsidies to crops such as corn, cotton, and sugar. But today’s higher prices may allow them to sell their crops at a decent price. However, major agriculture reforms and infrastructure development will be needed to ensure that the increased benefits go to the world’s 800 million undernourished people, most of whom live in rural areas. - Christopher Flavin, president of the Worldwatch Institute

Biofuels for Transport, undertaken with support from the German Ministry of Food, Agriculture, and Consumer Protection, assesses the range of 'sustainability' issues the biofuels industry will present in the years ahead, ranging from implications for the global climate and water resources to biological diversity and the world’s poor. The report finds that rising food prices are a hardship for some urban poor, who will need increased assistance from the World Food Program and other relief efforts.

But, as many experts have stressed, a far larger group of poor people stands to benefit from biofuels, namely those who live in rural areas (previous post). The researchers stress that the central cause of food scarcity is poverty, and seeking food security by driving agricultural prices ever lower will hurt more people than it helps.

In fact, rising agricultural prices may have major economic benefits, especially to the vast mass of the rural poor. Biofuels can, for the first time, bring increased incomes and boost the food security of these people. In Sub-Saharan Africa more than 60 per cent of people make a living off the land (map, click to enlarge) and low agricultural prices as well as trade barriers and subsidies in the wealthy West have kept them in dire poverty. Biofuels offer a unique opportunity to break this lethal status quo, according to the report.

Moreover, the tripling in oil prices since 2002 has been an economic disaster for poor nations which in the future may be able to purchase fuel from their own farmers rather than spending scarce foreign exchange on imported oil. Of the 47 poorest countries, 38 are net importers of oil and 25 import all of their oil. The result of this disastrously costly dependence is a potential collapse of poverty alleviation, health, education, hunger and development efforts that are felt by all the weakest segments of society. The UN recently found that some of the poorest countries are already forced to spend twice as much on oil imports, than on health care. Biofuels can overcome this catastrophic situation:
energy :: sustainability :: oil dependence :: ethanol :: biodiesel :: biomass :: bioenergy :: biofuels :: poverty alleviation :: rural development :: developing countries ::

Since the Biofuels for Transport study was researched, biofuels growth has skyrocketed. According to the latest estimates, world biofuels production rose 28 percent in 2006 to 44 billion liters, with fuel ethanol increasing 22 percent and biodiesel rising 80 percent. Although biofuels comprise less than 1 percent of the global liquid fuel supply, the surge in production of biofuels in 2006 met 17 percent of the increase in supply of all liquid fuels worldwide last year.

This rapid growth is having unintended impacts. Large-scale biofuels production can threaten biodiversity, as seen recently with palm oil plantations in Indonesia that are encroaching on forests and edging out the endangered orangutan population—worrying European consumers who have begun importing palm oil from Southeast Asia.

It is critical to the stability of the climate that we prevent biofuels from expanding at the expense of rainforests and other valuable ecosystems that store carbon and provide other ecological services. Energy crops should instead be established on the millions of hectares of degraded land that can be found around the world. - Suzanne Hunt, directed the team of 15 researchers from four countries

“Current biofuels production methods place a heavy burden on land and water resources, due in part to the fossil fuel and chemical intensive corn that is used to produce over half the world’s ethanol,” says Hunt. “Farming practices need to be reexamined if agriculture is to provide energy as well as food for a rapidly growing global population that is hungry for both.”

The book concludes that the long-term potential of biofuels is in the use of non-food feedstocks, including agricultural and forestry wastes, as well as fast-growing, cellulose-rich energy crops such as perennial grasses and trees. Following the model of Brazil’s sugar cane-based biofuels industry, cellulosic ethanol could dramatically reduce the carbon dioxide and nitrogen pollution that results from today’s biofuel crops.

“The question is not if biofuels will play a major part in the global transportation fuel market, but when and at what price,” says Flavin. “The first priority should be to ensure that the industry develops sustainably—so that the problems of an oil-based economy are not replaced by another socially and ecologically bankrupt industry.”

The book recommends policies that protect natural resources, support a speedy transition to cellulosic technologies, and facilitate a sustainable international biofuels trade. Freer trade in biofuels should be coupled with social and environmental standards and a credible system to certify compliance.

“Biofuels alone will not solve the world’s transportation-related energy problems,” concludes the report. “Development of these fuels must occur within the context of a transition to a more efficient, less polluting and more diversified global transport sector. They must be part of a portfolio of options that includes dramatic improvements in vehicle fuel economy, investment in public transportation, and better urban planning.”

References:
Biofuel Review: Agricultural price hike could benefit rural poor - August 3, 2007.

Worldwatch Institute: Biofuels for Transportation: Global Potential and Implications for Sustainable Agriculture and Energy in the 21st Century.

EarthScan: Biofuels for Transportation: Global Potential and Implications for Sustainable Agriculture and Energy in the 21st Century, Publication Date: July 2007