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Bio-fuel responsible for rise in food prices: Study

The report of Oxfam International says bio-fuels have already contributed upto 30 per cent to the global rise in food prices.

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Contrary to the views of US President George W Bush that consumption of better diet in developing countries was resulting in rise in food prices, a new study has found the increasing demand for bio-fuels in the rich nations was the factor behind the scenario.

Bio-fuels have already contributed upto 30 per cent to the global rise in food prices and its increasing demand has pushed more than 30 million people into poverty, according to the report by Oxfam International which was released in New Delhi on Wednesday.

The demand for bio-fuels by rich countries is not only contributing to food insecurity and inflation but it is going to hit the poor countries hardest endangering the livelihood of at least 290 million people by creating food shortage, the report named ‘Another Inconvenient Truth’ said.

“Bio-fuel policies are actually helping to accelerate climate change and deepen poverty and hunger. Rich countries’ demands for more bio-fuel in their transport fuels are causing spiralling production and food inflation,” author of the report Rob Bailey said.

He estimated that the current bio-fuel rush, if it continues, could result in an extra 600 million hungry people by 2025 undermining the Millennium Development Goal of eradicating poverty and hunger.

The demand for bio-fuels is affecting the climate in another way also. To meet the spiralling demand for bio-fuel in rich countries like EU, US and Canada some countries are expanding their production for bio-fuel.

The increased production means taking over of agricultural land and forcing farming to expand into lands that are important carbon sinks, like forests and wetlands.

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This triggers the release of carbon from soil and vegetation that will take decades to repay.

The European Commission has set the target to replace the 10 per cent of transport energy needs through bio-fuel and US plans to increase the annual use of renewable fuels, mainly by ethanol up to 36 billion by 2022.

Calling for an immediate policy change Bailey said, “Rich country governments should not use bio-fuels as an excuse to avoid urgent decisions about how to reduce their unfettered demand for petrol and diesel”.

Oxfam estimates that by 2020, as a result of the EU’s 10 per cent bio-fuel target, carbon emissions from changing land use for palm oil could be almost 70 times greater than the annual savings the EU hopes to achieve from bio-fuels by then.

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“Even if the entire world’s supply of grains and sugars were converted into ethanol tomorrow in the process giving us all even less to eat, we would only be able to replace 40 per cent of our petrol and diesel consumption,” he said.

The trade barriers in Europe and the US prevent cheaper, more sustainability-produced feedstock imports being used to satisfy demand in the burgeoning rich world markets, the report notes.

“Rich countries spent up to USD 5 billion last year supporting bio-fuel while blocking cheaper Brazilian ethanol, which is far less damaging for global food security,” the report states.

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