The food versus fuel debate is back on the agenda with the launch of a map designed by anti-poverty organization ActionAid and the Environmental Working Group (EWG). The map shows which countries are at highest risk of a food crisis due to food price rises.
The organization says volatile food markets and food insecurity contributed to the civic unrest that recently brought down Egypt’s president. They link the food price crisis to the American insistence on subsidizing corn ethanol.
“When we send seven times as much corn to ethanol plants as we keep in our own stockpiles, the diversion of just a few more bushels sends shockwaves through commodity markets and food price indices”, said Sheila Karpf, legislative and policy analyst at EWG.
In fact, a Los Angeles Times report last week highlighted how corn ethanol is booming in America right now. Ethanol production hit record levels last year, and some companies are looking to expand, wrote the publication. This is a consequence of a federal mandate to quadruple the nation’s use of biofuels to 36 billion gallons annually by 2022 from 2008 levels. Corn ethanol gets almost half of that market, or 15 billion gallons. Besides federal incentives, some states have similar programs in place as well.
Altogether, three quarters of tax credits destined for renewable energy goes to ethanol. A combination of rising oil prices and increasing demand for ethanol has created a bullish market for the product. As a consequence, the U.S. has shifted 40 percent of corn production from food and feed to fuel, putting stress on corn supplies in a year when stocks are at the lowest level in decades, ActionAid said.
“We are teetering on a full-fledged global crisis and one trigger – rising oil prices, a spike in the cost of rice, an export ban, or climate related shortage of crops – could be the tipping point,” said Marie Brill, senior policy analyst at ActionAid USA. “To use storm terminology, we were in a food crisis watch last fall, which has escalated into a food crisis warning. The U.S. needs to be prepared and to take steps now to mitigate a food crisis and prevent future crises.”
The map identifies 52 high-risk countries where people rely on 83 billion tons of imported food per year. 750 million individuals are already malnourished in those places. Corn is a main staple, alongside soybeans and wheat exported by the United States.
Half of these countries are experiencing food price hikes and 37 of them are heavy importers of corn. The average income in these places is $2 a day and people spend at least 55 per cent of their income on food.
The data which the map was based on was compiled from the United Nations’ Food and Agriculture Organization (FAO), the International Food Policy Research Institute (IFPRI), US Dept. of Agriculture’s Economic Research Service, the World Bank, ActionAid and EWG.
Article by Antonio Pasolini, appearing courtesy Justmeans.