Dum dee dum dee dum: More on food vs. fuel

Global food crisis: Counting the real cost of biofuels
From The Guardian

This year, 40% of America's corn crop will go into car engines rather than stomachs. Add the fact that the US is both the world's largest producer of corn and the largest exporter, and that 10 years ago only 7% of its crop went to ethanol production, and you start to see why enthusiasm for biofuels among oil importers has had such a marked impact on food prices.

Other factors have driven the breathtaking inflation and volatility in food markets over the last few years. These include a rising global population, millions more people shifting to western diets, declining crop yield growth, years of under-investment, extreme weather, high oil prices increasing the cost of inputs such as fertiliser, low stock levels, and kneejerk actions by governments such as food export bans and panic buying by importers.

But it is biofuels that have been the real game changer. As the International Monetary Fund observed in 2008, biofuels accounted for 1.5% of global liquid fuels supply that year, but represented nearly half the increase in food crop consumption, mainly because of corn-based ethanol in the US. While they only accounted for a small fraction of liquid fuels, the fact that they represented 75% of the net increase in non-Opec liquid fuels in 2008 goes a long way towards explaining why oil importers have taken to them with such enthusiasm.

That's scant comfort to the billion or so poor people who don't get enough to eat – they have seen food prices rise still further out of reach as a result of biofuel support policies. Is the tide finally turning against corn-based ethanol and other inefficient "first generation" biofuels?