Another Inconvenient Truth

Biofuel policies are contributing to food insecurity and inflation, and are not helping with climate or fuel security, according to a new report by international agency Oxfam. In today's report 'Another Inconvenient Truth, Oxfam calculates that rich-country biofuels policies have dragged more than 30 million people into poverty, and are responsible for up to 30% of the global rise in food prices.

'Policies promoting biofuels are actually helping to accelerate climate change and deepen poverty and hunger, said report author Rob Bailey, Oxfam's biofuels policy advisor. 'Thanks to generous subsidies and tax breaks, the fuel value for a crop now exceeds its food value. It is no surprise that, despite bumper crops, grain reserves are at an all-time low.

'Canada can begin to undo its mistaken policies by rejecting the biofuels legislation now before the Senate, said Robert Fox, executive director of Oxfam Canada. 'The law would in effect tax poor consumers through higher food prices by subsidizing the conversion of the corn crop into ethanol.

'Women and men living in poverty will pay the price because their food bills represent a greater share of their income, Fox said. 'And due to the globalized food system, our policies contribute to rising food prices in poor countries around the world.

Rich countries spent up to $15 billion last year supporting biofuels through targets, subsidies, tax breaks and tariffs, including blocking cheaper Brazilian ethanol made from sugarcane, which is far less damaging to global food security. At projected rates of increase, Canada's taxpayers will be paying $1bn per year in biofuel subsidies by 2010.

Rather than helping cope with climate change, Oxfam says, demand for biofuels expands farming onto lands that are important carbon sinks, like forests and wetlands, triggering the release of carbon that will take decades to repay. The most recent science indicates ethanol made from corn in Canada may actually emit more greenhouse gases than gasoline over the entire cycle of production and consumption.

Neither will biofuels address rich countries' need for fuel security. 'Even if the entire world's supply of grains and sugars were converted into ethanol tomorrow in the process leaving us little to eat we would only be able to replace 40% of our gasoline and diesel consumption, Bailey said. 'Biofuels are no excuse to avoid urgent decisions to reduce the unfettered demand for fossil fuels.

'More than half of Canada's corn crop would have to be turned into fuel to meet the five percent target proposed in the legislation before the Senate, Fox said. 'Burning food in our cars while people go hungry is madness.

Download an electonic copy of "Another Inconvenient Truth" (pdf doc)

NOTE: Mark Fried, Oxfam Canada's Policy Advisor, will be in front of the Senate Committee on Energy, the Environment and Natural Resources on June 25th. He will be a witness for the discussion on Bill C-33, an Act to amend the Canadian Environmental Protection Act.