‘Use of biofuel has raised food prices’

By C. Anand Reddy

New Delhi

June 6: In what is seen as a firm rejection of US President George W. Bush’s contention that rising prosperity in countries like India has been causing a spike in world food prices, Union agriculture and food minister Sharad Pawar has blamed it on diversion of food grains by some nations to produce bio-fuel.

"The FAO studies have clearly show that recent high commodity prices have not originated from emerging economies," Mr Pawar was quoted as saying by PTI, at the Food and Agriculture Organisation’s World Food Security Summit in Rome, which was inaugurated on Tuesday.

Mr Pawar cited FAO studies which suggested that additional demand for maize for making ethanol and demand for rape seed for making bio-diesel, have had the strongest impact on food prices.

A very similar sentiment was expressed by FAO director-general Jacques Diouf on the causes for souring world food prices. "Incomprehensible was the fact that subsidies worth $11-12 billion in 2006 were used to divert 100 million tonnes of cereals from human consumption "mostly to satisfy a thirst for fuels for vehicles", he said. Speaking at the inaugural session, Dr Diouf has called for "partnership agreements" between countries. Dr Diouf said "partnership agreements between countries that have financial resources, management capabilities and technologies and countries that have land, water and human resources". The current world food crisis had already had "tragic political and social consequences (food riots for example) in different countries" and could further "endanger world peace and security", Dr Diouf said.