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Biofuels may have pushed up food prices by 75% - report

Biofuels have forced global food prices up by 75 per cent - far more than previously estimated - according to a confidential World Bank report published in a British newspaper today.
The assessment is based on a detailed analysis by Don Mitchell, an internationally respected economist at the Washington-based global financial body, the Guardian said.
The figure contradicts US government estimates that plant-derived fuels have contributed less than 3 per cent to food-price increases, the newspaper said.
It will add to pressure on governments in Washington and Europe, which have turned to biofuels to reduce emissions of greenhouse gases and reduce their dependence on imported oil.
Leaders of the G8 leading industrial countries meet next week in Japan, where they will discuss the food crisis and come under intense lobbying from campaigners calling for a moratorium on the use of plant-derived fuels.
Rising food prices have pushed 100 million people worldwide below the poverty line, according to the World Bank, and have sparked riots from Bangladesh to Egypt.
US President George Bush has linked higher food prices to higher demand from India and China, but the World Bank study said: "Rapid income growth in developing countries has not led to large increases in global grain consumption and was not a major factor responsible for the large price increases."
Meanwhile the European Union may get barely one-third of its target for biofuels in transport fuels from home-produced sources by 2020, requiring massive imports to meet the goal, a draft European Environment Agency report said.
The EU plans to source 10 per cent of transport fuels from renewable sources by 2020, with the bulk of that seen coming from biofuels.
Critics say the target will contribute to deforestation in developing nations and soaring food prices.
The report, sent to the bloc's 27-member states for comments and seen by Reuters, shows the most cost-effective and sustainable scenario for biofuels would deliver just 3.4 percent of the EU's transport fuels from domestic production in 2020.
An EEA spokeswoman said the report was at an early stage and was not scheduled for publication until September.
She declined to discuss details but said the final figure may be higher as the model does not factor in the effect of soaring oil prices, international trade or the fact that biomass may be diverted from power or heat generation to boost its use in transport fuels.
An EU source said the 3.4 per cent figure could equally be reduced by ever tighter EU social and environmental standards.
"The rest of the 10 percent would either have to be imported or would not be acheived at all," added the source.

� 2008 ireland.com

http://www.irishtimes.com/newspaper/breaking/2008/0704/breaking71.htm

[mindmetoo]

Right. You don't make fuel from food. You make it from waste products. Pretty sure that's what the Brazilians did.

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[mindmetoo]

My understanding is whatever they're using is waste, be it a byproduct or simply an over surplus of sugar. Not all sugar grown is fit for human consumption.

http://en.wikipedia.org/wiki/Ethanol_fuel_in_Brazil#Electricity_from_Sugarcane_Bagasse

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[Zenas]

[mindmetoo]

[peppermint]

[mindmetoo]

[Bigfeet]

Best idea I've heard is to use switchgrass grown on land that no one wants to farm. It can be cultivated up to 3 times per year.

[mindmetoo]

[bucheon bum]

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[Zenas]

Dual Mandate for the Federal Reserve, The Pursuit of Price Stability and Full Employment

"The Federal Reserve currently has two legislated goals--price stability and full employment "

http://ideas.repec.org/p/lev/levppb/60.html

If the central bank has two goals one of which is price stability - i.e no inflation or deflation, then the Fed must able to control prices.

They do - by raising and lowering interest rates - making fiat currency easier to more difficult to acquire.

Since the Fed made easy money their policy for the last several years, creating the housing bubble, they've also devalued the value of the dollar by printing too many dollars. Any one with common sense should be able to see this. Water is cheap because there is so much of it. Gold is expensive because relatively speaking, there is so little of it.

That, - the increase in the money supply - is what is causing the inflation we are seeing in food, oil and other commodity prices. [the speculators are also buying future contracts expecting the price to go up, causing the price to stay high, because they can see that the Fed can't stop printing money because the debt needs repaying with dollars].

When investors realize that monetary inflation is out of control, they will rush to hard assets, such as gold and silver, which have been historically, a reliable store of value.

A $1 one ounce of silver coin in 1968 bought 4 gallons of gas. One ounce of silver today - $17.50 an ounce - still buys four gallons of gas. When you pay with dollars, you pay $17.50 for four gallons of gas.

That's price inflation - the value of the dollar has gone down. It now takes $17 + dollars to buy today what $ 1 would buy in 1968.
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A fiat currency guarantees inflation - it's built into the system. We've been on a fiat currency since 1913 went off the gold standard in 1933 and could no longer redeem the silver certificate 'dollar' in silver after 1964.

Inflation is the result.

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