US must stop promoting biofuels to tackle world hunger, says thinktank

Global Hunger Index says US government support for corn ethanol was a factor in this year's food price spikes
Suzanne Goldenberg guardian.co.uk 11 Oct 11;

America must stop promoting the production of biofuels if there is to be any real progress in addressing spiking global food prices and famine, such as seen in the Horn of Africa, an authoritative thinktank has warned.

A new report, the Global Hunger Index, warned that US government support for corn ethanol was a major factor behind this year's food price spikes – and was projected to fuel further volatility in food prices over the next decade.

Although the report noted some improvements over the past 20 years, 26 countries, mainly in sub-Saharan Africa, are still at extreme risk of hunger including Burundi, Chad, the Democratic Republic of the Congo and Eritrea.

The hunger situation worsened most dramatically in the DRC with a 63% increase in hunger and undernourishment since 1990, the report warned. Burundi's hunger index rose by 21% and North Korea's by 18%.

And while Latin America, south-east Asia and the Caribbean made "remarkable progress" in reducing hunger, the report singled out India in particular for failing to improve the situation of its poorest people despite rapid economic growth since 2001.

India had "alarming" rates of hunger and undernourishment, putting it in line with the situation in sub-Saharan Africa.

The proportion of undernourished children in India has risen 2% since the mid-1990s, the report said. It blamed the increase in part on the lower status of women.

But the report also suggested that efforts to reduce world hunger would be constrained without action on climate change and changes in US and European government policies promoting the use of food stocks as fuel.

"The recent dramatic increase in pro-biofuel policies throughout the developed and developing world poses a major challenge," said the report, produced jointly by the International Food Policy Research Institute (IFPRI), Welt Hunger Hilfe and Concern Worldwide.

"Biofuel subsidies should be curtailed in order to minimise biofuels' contribution to volatility in food markets. It also means that biofuel mandates should be removed."

In a conference call with reporters, Maximo Torero, co-author of the report and director of the markets and trade division of IFPRI, said America's domination of global corn production meant that US domestic policies had an outsized effect on prices.

In practical terms, this means countries that import food – especially those in sub-Saharan Africa which import a greater share of their food – are at the mercy of US domestic policies governing corn ethanol.

Food price shocks, such as experienced this past year, could also undermine policies which had been making progress in reducing hunger.

US policies encouraging corn ethanol production, such as subsidies and mandates, ensure more corn is grown for fuel rather than food – especially when oil prices are high.

"What this means is that every policy on biofuels will create an increase in volatility, will create an increase in price and that will be translated to all the other countries," Torero said.

Torero warned that projected growth in US biofuel production over the next decade would put even more pressure on global corn prices.

"The mandate is going to continue to put pressure on prices and volatility for the coming years," he said.