Sunday, June 29, 2008

Response to Oxfam’s Shocking Report

Two days after I wrote about the difficulties of converting fuel crops to food, Oxfam International issued an inexplicable report effectively asking for a halt to biofuel production, but offering no solutions or even sympathy for the global crisis their recommendations would cause if fully implemented.

If you have seen the Oxfam report, these are the key points in understanding why the cutback they recommend in biofuel would lead to widespread poverty and hunger:

  • Fuel is necessary for growing most crops. High fuel prices this year have already led many farmers to cut back on the number of fields they plant and in some cases to abandon farming entirely. If fuel production is cut further, this would lead to fuel prices that are higher still, potentially forcing millions of farmers to stop farming. Oxfam’s report offers no alternate source for the food that would be lost in this scenario, nor any alternate source of income for the farmers that would be affected.
  • Many of the crops and croplands used for biofuel are not suitable for food use. In addition, in the best case, biofuel is made from waste products that have no alternate use. Oxfam’s recommendations could result in the loss of the energy made from many of these materials, with no compensating benefit.
  • The increase in energy prices (including fertilizer) is virtually the entire reason for the sudden increase in the price of food. Oxfam’s own report concedes that total food production is rising at least as fast as biofuel production, so the implication that a decline in food production is to blame for high food prices is entirely spurious. For some food items, energy costs account for most of the final cost of the food. Food prices cannot be brought down worldwide by policies that drive energy prices higher.
  • The spot food shortages that have made headlines in the last year were localized and short-lived, reflecting (so far) not a global shortfall of food production, but distribution problems and market manipulations including hoarding that could easily have been created by corporate interests or speculators for their own financial gain. An actual global shortfall in food production would lead to shortages across whole regions for entire seasons. Problems caused by market manipulations cannot be solved by more market manipulations. By contrast, the increase in energy costs is caused quite simply by a shortfall in global production of energy when compared to the rising demand for energy. It can be solved only by an increase in energy production combined with efficiencies in energy use.
  • The energy conservation methods Oxfam advocates are important but do not serve as a substitute for fuel. Right now, the world needs both fuel and energy conservation.
  • Ethanol is not the dangerous acid that Oxfam’s report implies. On balance, ethanol is safer to store and transport than gasoline.
  • Biofuel is not the novelty or gimmick that Oxfam is suggesting. It could supply all the world’s liquid fuel needs eventually if there are enormous improvements in energy efficiency and if new sources of energy, such as solar and wind, can be added on a large scale. The fossil fuel we have relied upon for the past century will mostly run out this century, but biofuel can continue. It would be the height of folly to procrastinate on the early work toward what is likely to be a critical source of energy for the world just a generation or two from now.

Oxfam’s work on the distribution side of the food crisis is admirable, and I hope its bizarre recommendations about biofuel are merely the thinking of advocates who are too close to their work on food to notice the bigger picture of how food is created. Quite simply, there is nothing to be gained by driving large numbers of farmers out of work and into poverty, and I think by focusing on the food and ignoring the needs of farmers, Oxfam has made recommendations that could dramatically worsen the crisis they are working so hard to solve.