Food vs. fuel: Reducing biofuel to boost food production could mitigate hunger crisis

27 May 2022 --- Too much food is used for biofuel production at a time when the Ukrainian war and bad harvests due to climate change are leading to a hunger catastrophe. World Resource Institute calculations indicate that cutting down grain used for ethanol production in the US and Europe by 50% “would compensate for all the lost exports of Ukrainian wheat, corn, barley and rye.”

“In the short term, we need these grains to alleviate food shortages,” says the WRI.

Data from the Organization for Economic Co-Operation and Development (OECD) explains that the arable land used to produce biofuels could provide 32% of sugar, 12% of corn and 15% of the vegetable oils consumed globally.

The organization notes that there is an inherent interchangeability between crops grown for biofuels, animal feed and food, even if they are not perfect substitutes.

The OECD warns that the increased demand for biofuels was already a driver of a food crisis in 2007-2008.

The UN’s Food and Agriculture Organization food index puts the cost of vegetable oils at around 240% higher in April 2022 compared to 2020.

“The food crisis, if we don’t get these safe corridors out, is going to last another year or two,” according to Okonjo-Iweala.Biofuels are not the silver bullet
On longer-term considerations, the WRI opposes EU biofuel production legislation.

“The EU Fit for 55 Initiative, which proposes vast new incentives for bioenergy from energy crops, could continue the potential for food vs. fuel conflicts. We estimate the Fit for 55 Initiative could use a projected one-fifth of Europe’s cropland”.

According to an EU Commission statement, the EU Fit 55 will entail a €210 billion (US$225 billion) investment from now to 2027.

Meanwhile, the World Economic Forum is pushing countries and the private sector to embrace a clean energy transition, reiterating its 55% emission reduction goal, for the EU, by 2030. This might lead to some counterproductive solutions overdependent on biofuel, as politicians are in a rush.

“The EU is determined to end our dependence on Russian fossil fuels as quickly as possible,” says EU commission executive vice president Frans Timmermans. 

In its 2021-2031 Agricultural Outlook, the EU commission projects that biodiesel consumption will peak at 18.9 billion liters in 2023 when the food crisis might still be persistent, bioethanol will comprise 7.1 billion of the total biodiesel use.

Safe corridors to feed the worldThe EU commission projects that biodiesel consumption will peak at 18.9 billion liters in 2023.
At the Davos summit, world leaders are trying to find a way to liberate the Ukrainian Black Sea crops, which would ease the food crisis, especially for Africa.

“The food crisis, if we don’t get these safe corridors out, is going to last another year or two,” reveals Ngozi Okonjo-Iweala, director-general of the World Trade Organization.

Okonjo-Iweala explains that the UN secretary-general Antonio Guterres is working on the situation. Guterres admitted last week that there is no solution to the food crisis without reintegrating Ukraine and Russia into world markets.

“[Guterres] formed a crisis group composed of key UN agencies and related agencies. WTO is part of it to look at the food, energy and financial aspects of the crisis. One issue is the creation of safe corridors and looking at alternative means to evacuate Ukrainian grain,” she says.

Okonjo-Iweala also talks about the possibility of mobilizing food by land, although she admits it is an ineffective solution:

“Rail could take one or two million metric tons, but it’s very difficult, so we really need the Black Sea.”

Africa would particularly benefit from the blockade lift, as countries like Eritrea, Somalia and the Democratic Republic of Congo source over 80% of their wheat from Ukraine and Russia. 

The Black Sea, a critical region
The WRI catalogs the Black Sea as the “global breadbasket.” Ukraine alone is responsible for producing 50% of the global sunflower oil and between 10%-15% of the wheat, barley and maize. 

Including Russia, the region produces 12% of all food calories globally traded, 29% of the wheat exports, 19% of maize and 78% of sunflower oil.

 Economic sanctions on Russia’s gas will drive up fertilizer prices “beyond current record near-record levels,” according to the WRI, which will reduce the yields of global crops. 

The organization suggests keeping markets and trade flow open and avoiding food export bans to prevent “painful price shocks.” But countries such as India, Malaysia and Indonesia have already succumbed to a domestic-first approach to protect local food stocks.

A relaxation of biofuel mandates is another solution proposed, as already mentioned. One country that has already reduced its biofuel production to boost food production and exports is Malaysia. 

The organization also suggests reducing food loss and waste, a change to more sustainable diets, or focusing subsidies on the crops that yield more calories.

By Marc Cervera

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