Wednesday, June 04, 2008


JULIAN BORGER, GUARDIAN, UK US subsidies for biofuel production were condemned by the head of the UN's Food and Agriculture Organisation, who said they were depriving people of food. Opening a UN food crisis summit in Rome, Jacques Diouf attacked the subsidies for corn ethanol during a wide-ranging critique of global policies on climate change and food security, which he said were slanted to favour the west.

"Nobody understands [why] $11-12bn of subsidies in 2006 and protective tariff policies [should be used to] divert 100m tons of cereals from human consumption, mostly to satisfy a thirst for fuel for vehicles," Diouf, the FAO director general, said. It was a thinly veiled attack. The FAO estimates US subsidies for the production of corn ethanol at $11-12bn.

Diouf also asked how a $64bn (£33bn) carbon market could be created in developed countries while "no funds can be found to prevent the annual deforestation of 13m hectares, especially in developing countries, whose tropical forest ecosystems act as carbon sinks for some 190 gigatonnes."

Before the summit, leaders of the US, Canadian and European biofuel industries wrote to Diouf warning him not to condemn biofuels. "It would be highly precipitous . . . for the United Nations or other international bodies to single out biofuels as the major cause for escalating food prices and take actions that might lead to even higher food prices," the industry group argued. But Diouf appears to have shrugged off the appeal.

The US agriculture secretary, Ed Schafer, stirred controversy on the eve of the Rome summit with his defense of corn ethanol, arguing that biofuel production only contributed "2 to 3%" to the recent dramatic rise in global food prices.

The claim clashed with research carried out by several international organisations. The International Monetary Fund has estimated that 20 to 30% of the food price increases in the past two years are accounted for by biofuels, and that last year they accounted for about half the increase in demand for principle food crops.