January 30, 2008

 

Ethanol use drives up world hunger and hurt US consumers

 

 

US ethanol production is pushing food prices upward and raising the specter of potential shortages, according to a report by an environmental think tank.

 

The country's ethanol push is a "misguided effort to reduce its oil insecurity," according to the Earth Policy Institute. The report released last week suggests the ethanol boom will hit US consumers in their pocketbooks and cause even more far-reaching problems in the developing world.

 

"One of the consequences of this enormous shift of grain is that hunger and malnutrition, which were supposed to be declining during this period, haven't," said Lester R. Brown, the institute's president and the author of the report. "They are now projecting that the 800 million people (living in hunger) will number 1.2 billion by 2025."

 

Brown said over consumption will also imperil the world's reserve supplies.

 

"We've seen world grain consumption exceeding production," Brown said. "We've been drawing down stocks down. Until today, carry-over stocks of grain equal only 54 days of world consumption. That's not much more than pipeline supplies."

 

Advocates for ethanol said that Brown's assessment ignores other factors that affect global food supplies and prices. They said the report wrongly places blame on the ethanol industry.

 

Matthew Hartwig, a spokesman for the Washington-based Renewable Fuels Association acknowledged that ethanol might bear some responsibility for increased food prices, but said the impact was minimal compared to other issues.

 

"Oil prices have gone up 40 or 50 percent and it takes a great deal of oil in particular to transport and process food," Hartwig said.

 

Hartwig also said the emergence of ethanol could offer benefits to farmers in less-developed countries. "They could invest in more of the technology they need to be more productive," he said.