Feeding the World?

President Bush in an interactive business session had argued that while prosperity in countries like India is good, it triggers increased demand for better nutrition, which in turn leads to higher food prices.The comments came close on the heels of US Secretary of State Condoleezza Rice’s controversial statement that ‘apparent improvement’ in the diets of people in India and China is among the causes of the current global food crisis.

The Truth

Biofuels have forced global food prices up by 75% - far more than previously estimated - according to a confidential World Bank report.

The figure emphatically contradicts the US government’s claims that plant-derived fuels contribute less than 3% to food-price rises. It will add to pressure on governments in Washington and across Europe, which have turned to plant-derived fuels to reduce emissions of greenhouse gases and reduce their dependence on imported oil. Senior development sources believe the report, completed in April, has not been published to avoid embarrassing President George Bush. The report confirms a British finding that the rush to develop biofuels has played a “significant” role in the dramatic rise in global food prices. And an estimates their impact as 20-30% rise.

“Political leaders seem intent on suppressing and ignoring the strong evidence that biofuels are a major factor in recent food price rises,” said Robert Bailey, policy adviser at Oxfam.

Production of biofuels has distorted food markets in three main ways. First, it has diverted grain away from food for fuel, with over a third of US corn now used to produce ethanol and about half of vegetable oils in the EU going towards the production of biodiesel. Second, farmers have been encouraged to set land aside for biofuel production. Third, it has sparked financial speculation in grains, driving prices up higher.

“It is clear that some biofuels have huge impacts on food prices,” said Dr David King, the government’s former chief scientific adviser.

However , the Indian apologists for capitalism should not feel too smug.

More than 1,300,000 tonnes of food grain rotted in storage stock-piles over the last decade in India according to a recent report.

“This amount of food grain could have fed over 10 million people in a year,” said activist Dev Ashish Bhattacharya.

-Reposted from Mailstrom