Food versus Fuel

The global population continues to grow, in places at an alarming rate, and will need to be fed and will expect to live an improved life style, consuming more energy. This raises questions of 'Food versus Fuel'; how much land and other resources are available, how should they be used and what are the priorities?

In the long term, crop yields are increasing year-on-year. However, lower than expected yields in any given year tend to increase global grain prices, as occurred in 2012 partly due to bad weather and drought affecting the Russian and US harvests, repsectively. The effects of yield variations may be exacerbated by speculation in agricultural commodities. In turn, this may contribute to short-term spikes in food prices for consumers.

The role of biofuels in global food price dynamics has been the subject of considerable discussion and media attention since 2007. In the summer of 2012, the UN Food and Agriculture Organisation called for a renewed debate on biofuels.

In 2012, the Chairman of Nestle, Peter Brabeck-Letmathe, blamed biofuels for the increase in food prices, stating, "If no food was used for fuel, the prices would come down again - that is very clear." However, a number of reports contradict this assertion.

Paul Conway, Chairman of Cargill, said, "The bigger picture globally is increased urbanisation, which leads to more food being consumed...there has also been an explosion in biofuel use and the financialisation of the agricultural markets." [Source: BBC Business News, Interview 2012].

Reports relevant to the food vs. fuels debate

In September 2013 a studied carried out by ECOFYS on behalf of ePure showed that ethanol is not causing major increases in food prices. The study Biofuels and food security: Risks and opportunities suggests that the impact of biofuel production on food prices is actually less than 1%.

The ECOFYS report conflicted with a short report by the EC Joint Research Centre (based on AGLINK-COSIMO model) Impacts of the EU biofuel policy on agricultural markets and land use. This suggests that if no biofuel policy was in place from 2013 in the EU, close to 6 million hectares (0.7% of world total) less cereals, oilseeds, sugar crops and palm oil would be harvested in the world in 2020 in comparison to the baseline scenario. However, the JEC report suggests a greater impact of biofuel policy on prices.

When considering the potential impact of first generation biofuels on food prices, a diversity of factors also need to be taken into account, such as oil prices, fertiliser costs, rising demand for meat in emerging economies, demands on land for bioenergy (heat and power) and other bioproducts (e.g. plant oils for non-food use), rising global populations, the effects of climate change on agricultural productivity, local market conditions, and other factors that impact on price and availability of food in the short and long term.

In January 2013, The Institution of Mechanical Engineers in the UK published a report Global Food: Waste Not, Want Not, which points out: "We produce about four billion metric tonnes of food per annum. Yet due to poor practices in harvesting, storage and transportation, as well as market and consumer wastage, it is estimated that 30–50% (or 1.2–2 billion tonnes) of all food produced never reaches a human stomach. Furthermore, this figure does not reflect the fact that large amounts of land, energy, fertilisers and water have also been lost in the production of foodstuffs which simply end up as waste. This level of wastage is a tragedy that cannot continue if we are to succeed in the challenge of sustainably meeting our future food demands."

Livestock Production vs. Energy Crops

Globally, there is an increasing demand for land for livestock production (grazing and animal feed production), driven partly by rising middle class incomes in rapidly expanding economies. Not all land used for meat production is essential for human nutrition, with much consumption being a lifestyle choice. Production of plant protein is less energy intensive. Some land currently used for livestock could potentially be used for energy crops, without a negative impact on human health or any increase in GHG emissions. Some reports suggest that conversion of land from meat production to bioenergy feedstocks could offer environmental and health benefits, for example Zero Carbon Britain (PDF).

In September 2013, the FAO report Tackling Climate Change through Livestock estimated that 7.1 gigatonnes of carbon dioxide equivalent (CO2-eq) per annum was produced by the livestock industry representing 14.5 % of all human-induced emissions (other studies put the figue as high as 18 %, more than the total emissions from all forms of transport). Beef and dairy production account for the majority of emissions, respectively contributing 41 and 19 % of the sector’s emissions; while pig meat and poultry meat and eggs contribute respectively 9% and 8% to the sector's emissions. Sources of emissions include : feed production and processing (45% of the total – with 9 percent attributable to the expansion of pasture and feed crops into forests), enteric fermentation from ruminants (39%), and manure decomposition (10%). The remainder is attributable to the processing and transportation of animal products.