Calories Food and Energy

What do Fidel Castro and a prominent leader of the world’s largest agro industry business have in common? It is the belief that politically motivated policies supporting the rush to biofuel production has caused excessive food inflation and starvation in the world’s poorest countries. In middle income countries such as Barbados it has placed pressure on families who spend a large percentage of their income on food and reducing their quality of life.

Fidel Castro has long criticized the United States for its use of grain in the production of ethanol and the impact that it has on food scarcity and price escalation. Now the chairman of Nestle Mr. Peter Brabeck-Letmathe has joined the former President of Communist Cuba in decrying the ever expanding production of biofuels. He was critical of policy makers’ lack of understanding of the linkage between food and energy – the calorie.

The energy stored in a bushel of corn can fuel a car or feed a person. Increasingly, because of political decisions in America, Europe and Brazil, crops formerly grown for food or livestock feed, are being grown for biofuel production. This year it is estimated that America will grow more corn for biofuel than for feed and food while in Europe 50 percent of rapeseed production will find its way into the fuel tanks of trucks and cars.

In a country such as the United States where less than ten percent of disposable income is spent at the supermarket, the effect of food inflation is marginal, in Barbados where the supermarket bill is between 40 and 60 percent of disposable income for many Barbadians, the increase in the price of food is felt much more keenly. In countries where food accounts for 80% or more of disposable income the increase in food prices result in malnutrition, starvation and civil insurrection. What we refer to as the Arab spring that has engulfed Tunisia, Egypt, Libya and Syria essentially started as a protest against significant increases in the cost of food, a factor that has proved to be a powerful trigger for protest and riot.

The energy market is 20 times the size of the food market in terms of calories. This means that the stated goals of some of today’s political leaders who want to achieve a biofuel component of 20% of the energy market would mean tripling food crop output without adding anything to the food consumed by people. It seems as though they just have not done the math but then again there is little new in this.

The bottom line is that the economics of biofuels is seriously flawed and demonstrates the massive distortions that occur as a result of government’s intervention in the marketplace through subsidies. The human tragedy that follows is inexcusable.

If we want to balance the food production to human need we should articulate a policy of no food for fuel. This should be our local, regional and international position in achieving stability in food production for mankind and an assured affordability of the basic food requirements.

phillip.goddard@braggadax.com