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Economist Urges EU, U.S. To Change Biofuel Targets
By Aoife White, AP Business Writer
Manufacturing.Net - May 05, 2008

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BRUSSELS, Belgium (AP) -- Economist Jeffrey Sachs urged the United States and the European Union on Monday to reconsider a shift to biofuels that has helped increase food prices by turning agricultural land over to energy crops.

Targets to produce more fuels that release less carbon dioxide ''do not make sense now in a global food scarcity condition,'' Sachs, a special adviser to the United Nations, told reporters before he spoke to EU lawmakers at the European Parliament.

''In the United States, as much as one-third of the maize crop this year will go to the gas tank and this is a huge blow to the world food supply, so these programs should be cut back significantly,'' he said.

So far, the U.S. biofuel program has had more impact on food shortages, he said, but Europe's plans to rapidly boost biofuel output in coming years would also start to bite.

''Neither of them makes much sense actually in terms of the environmental effect, the energy balance, or the food impact, so I would advocate a reconsideration of both under the new market conditions,'' he said.

Sachs, the director of the Earth Institute at Columbia University, said it was unfair to blame financial speculators for soaring prices for basic foods such as wheat and rice.

''The fact inventories are very low, that food supply is more stagnant compared to food demand, gives a reason for speculators to try and buy, and hold grains in anticipation of tight conditions in future months and years,'' he said.

These underlying problems -- ''a tight food supply and vulnerability to climate shocks'' -- were not going to disappear and would need longer term solutions such as more development aid to poorer nations in Africa to help them increase food production, he said.

Last month, top international food scientists recommended a halt in the use of food-based biofuels, such as ethanol, because they say it would cut corn prices by 20 percent during a world food crisis.


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Talkback!
Manufacturing.net is pleased to provide you an opportunity to share your opinions on any of the news stories or articles on our site. We reserve the right to edit/remove comments.
Viewing 7 User Comments
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Government Intervention  5/5/2008 3:03:00 PM
Again we see what happens when the government meddles in markets. They have no business regulating where our fuel supplies come from nor do they have any expertise in the field. The market should be the only regulation.
food price increase not due to Biofuel   5/5/2008 4:48:00 PM
The primary reason food prices have gone up is not due to biofuel. The true reason is because of the significant increase in fossil fuel costs of gasoline and diesel that farmers use to grow and harvest the crops. The same applies to the doubling of airfare ticket prices. Biofuel isn't the culprit but part of the solution.
Comment on Government Intervention  5/6/2008 5:11:00 PM
I read with dismay the comment about government's involvement in biofuels. The same line of inflexible thinking would not support government initiatives to develop wind, solar or other forms of renewable energy. A casual look at the wild fluctuations of the world's stock markets should give pause to anybody who has blind faith in the "market" to regulate anything.
fuel cost  5/8/2008 4:25:00 PM
We all heard the profits made by the oil companies in past years, rising costs with due to reason or so they say. I question why the rising costs now and how any manufacturer can raise prices on product that has already been produced / refined. I'm in the manufacturing business and couldn't think of raising costs on product I have already produced and have warehoused. I believe it is called price gauging.
You name it  5/9/2008 7:45:00 AM
With merger after merger and a few in charge of much and a very rich few along with a government that doesn't respect are wishes but do as they please kind of says it all! Americans better wakeup and smell the coffee because we are losing are freedoms
Greedy Oil Producers?  5/9/2008 11:01:00 AM
It's really a simple case of supply and demand... The oil companies are getting high $'s from China and other developing nations. If China is willing to pay top dollar are you saying that the oil companies should say "no" and sell for a lower price here? Or maybe they should charge higher prices to the Chinese and lower prices to US companies? I see a dilemma here without an easy answer...
Biofuels, Oil, Food supply and Energy  5/12/2008 6:12:00 PM
If we believe in a supply and demand market, why not end biofuel and oil subsidies and let the resulting cost of supply determine where our energy comes from? How about nuclear which, with electric cars, would significantly reduce demand.


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