December 10, 2007

 

South Africa lowers target for biofuel production

 

 

South Africa has lowered its target for biofuels production in the coming years over concerns about food security, the country's energy minister said on Thursday (December 6).

 

Instead of a target of 4.5 percent of its total fuel production, the cabinet had approved a 2 percent target for production by 2013, Minerals and Energy Affairs Minister Buyelwa Sonjica said at a post-cabinet-meeting media briefing in Pretoria, the capital city.

 

This is part of an industrial strategy for the development of biofuels in the country.

 

The strategy also proposes that the use of corn be excluded in the early stages of the biofuel industry's development.

 

This is due largely to food security concerns, fears around (food) price increases and the fact that corn is a staple food source for the majority of poor in the country, Sonjica said.

 

She said crops such as soy, canola and sunflower could still be used for biodiesel, while sugar cane and sugar beet could be used for bioethanol.

 

The fuel levy exemption for biodiesel will increase from the current 40 percent to 50 percent and bioethanol will have a 100 percent exemption.

 

South African National Treasury Director-General Lesetja Kganyago acknowledged last month that the big international drive for biofuel is pushing up world food prices, affecting the poor most significantly.

 

The price of grain, a major source of biofuel that is considered to be cleaner than fossil fuels, has risen sharply over the past year, he said.

 

The use of biofuels has stirred a worldwide debate over food security, with worries that due to rising demand for biofuels, farmers worldwide have an increased economic incentive to grow crops for biofuel production instead of food production, which could lead to reduced food production and increased food prices and inflation.

 

The impacts of this would be greatest on poorer countries or countries that rely on imported food for their subsistence.