Biofuels & the "silent tsunami": what's mining got to do with it? London Calling explains…….

Published by MAC on 2008-05-05

"Food riots" have been erupting in a number of African countries - notably Egypt, Cameroon, Ivory Coast, Senegal, Burkina Faso and Madagascar. The rocketing traded price of wheat has put bread beyond the buying power of many citizens, while state subsidies to bakeries have been collapsing. This new "global crisis" is blamed on a number of factors. There's increasing evidence that it's partly caused by substituting biofuels for food crop cultivation on diminishing agricultural land - a parlous "strategy" for which trading companies, power producers and many governments must share responsibility. As a result, there's been mounting opposition to biofuel plantions by communities in Latin America, India, Africa, Indonesia, and elsewhere.

Somewhat stealthily, some mining companies are also moving into biofuels, either directly or by close association with producers.

Rio Tinto is trying to advance a huge potassium mining project in Argentina which was roundly cricitised by a representative of the Mendoza Assembly in April at the company's annual general meeting. Output from the mine is planned for sale to Brazil as fertiliser for its own biofuel production; ironically the country's soy production has already caused depletion domestic reserves of potassium.

Canadian company Camec - rebuffed in an attempt to mine the DR Congo - recently set up a biofuels company in Mozambique. See:

http://www.minesandcommunities.org//article.php?a=8261

And Ghana's Chamber of Mines has just entered a joint venture with a biodiesel firm which (so the Chamber claims) will help meet the "long term sustainability" needs of communities, after mining ceases.

But evidence is growing that the opposite is likely to happen.

Last month Friends of the Earth-Europe published criticisms of the purported "certification" of "sustainable" biofuels - notably of soy and sugarcane plantations in Latin America. See:
http://www.foeeurope.org:80/agrofuels/sustainabilitysmokescreen.htm

The FOE critique coincided with an explosive statement by Jean Ziegler, the United Nations special rapporteur on the right to food, in which he roundly condemned US and European pro-biofuels policies as "criminal."

Reaping what you sow

Some commentators argue that there are "good" and "bad" types of crop, or other inputs which can produce fuel. For example, they seek to distinguish the benefits of sugarcane and the “recycling” of plant and industrial “wastes” (like tyres) from the squandering of cereals (such as corn grown for ethanol) and oil seed which could directly feed people and help lower unacceptably high food prices. [see: "Biofuels Halt Would Ease Food Prices - Ag Group", below.]

Rarely in this debate is there substantial questioning of the end-use of these fuels, primarily in private transport.

It should also be recognised that supplying food crops to animals, rather than directly to humans, is now being strongly criticised, both as a cause of increasing hunger and as a major contributor to global greenhouse gas emissions.

So it's not just the simple substitution of "food for fuel" that's at issue here. It's also the very nature of what we seed in the soil; how it's fertilised and processed; and, ultimately, in whose stomachs the product ends up.

[London Calling is published by Nostromo Research, London. Views expressed are not necessariyl those of the editors of the Mines and Communities website. They may be freely reproduced, provided full acknowledgment given to the author and sources quoted.]

Ghana: Mining Companies Venture Into Biodiesel

Public Agenda (Accra)

25th April 2008

The Ghana Chamber of Mines and BioDiesel Ltd have entered into an agreement with the goal to develop a biodiesel strategy for the land area for the members of The Ghana Chamber of Mines.

The members of The Ghana Chamber of Mines represents the interest of 90% of all mining companies in Ghana including: AngloGold Ashanti, Newmont, Ghana, GoldField's Ghana, Ghana Bauxite and Ghana Manganese.

Currently 4 304 km2 or 430 400 hectares of land area is under large scale mining operation by The Ghana Chamber of Mines member companies, who currently employ more than 50 000 peoples directly and indirectly.

As part of a poverty reduction programme the Ghana Chamber of Mines members companies have introduced Alternative Livelihood Projects (ALP's) in all their catchments areas. The aim of the Alternative Livelihood Projects is to ensure the long-term sustainability of the communities and people even after mining activities had ceased in a particular region.

To meet these goal The Ghana Chamber of Mines have entered a collaboration agreement with BioDiesel Ltd. for a biodiesel cultivation and refining programme to enable Ghana to become a major source of biofuel in the near future.

After agreements have been effected, the member companies involved would provide start-up capital to out growers towards land preparation, as well as micro credits and agriculture inputs. Jatropha will be the one of the key crops to facilitate the above goals.

UN: Biofuel Production 'Criminal Path' to Global Food Crisis

GENEVA, Switzerland, (ENS)

28th April 2008

The United States and the European Union have taken a "criminal path" by contributing to an explosive rise in global food prices through using food crops to produce biofuels, the United Nations special rapporteur on the right to food said today.

At a press conference in Geneva, Jean Ziegler of Switzerland said that fuel policies pursued by the U.S. and the EU were one of the main causes of the current worldwide food crisis.

Ziegler was speaking before a meeting in Bern, Switzerland between UN Secretary-General Ban Ki-moon and the heads of key United Nations agencies.

Ziegler said that last year the United States used a third of its corn crop to create biofuels, while the European Union is planning to have 10 percent of its petrol supplied by biofuels.

The Special Rapporteur has called for a five-year moratorium on the production of biofuels.

Ziegler also said that speculation on international markets is behind 30 percent of the increase in food prices.

He said that companies such as Cargill, which controls a quarter of all cereal production, have enormous power over the market. He added that hedge funds are also making huge profits from raw materials markets, and called for new financial regulations to prevent such speculation.

The Special Rapporteur warned of worsening food riots and a "horrifying" increase in deaths by starvation before reforms could take effect.

Meanwhile, speaking in Rome today, a nutritionist with the UN World Food Programme said that "global price rises mean that food is literally being taken out of the mouths of hungry children whose parents can no longer afford to feed them."

Andrew Thorne-Lyman said that even temporarily depriving children of the nutrients they need to grow and thrive can leave permanent scars in terms of stunting their physical growth and intellectual potential. He said that families in the developing world are "finding their buying power has been slashed by food price rises, meaning that they can buy less food or food which isn't as nutritious."

But not everyone agrees. Toni Nuernberg, executive director of the Ethanol Promotion and Information Council based in Omaha, Nebraska, says, "I can unequivocally state that ethanol does not take food from the mouths of starving people."

"Ethanol production uses field corn - most of which is fed to livestock with only a small percentage going into cereals and snacks. In fact, only the starch portion of the corn kernel is used to produce ethanol. The vitamins, minerals, proteins and fiber are converted to other products including sweeteners, corn oil and high-value livestock feed - feed which helps livestock producers add to the overall food supply," said Nuernberg on Tuesday.

Nuernberg relates rising energy costs to food bills, as growers fuel tractors and machinery and truckers transport foodstuffs to market.

"The United States spends roughly one billion dollars a day on imported oil. A fraction of these funds would more than make up for the shortfall in the World Food Program," Nuernberg said. "Ethanol is just one element in our drive to reduce our dependence on fossil fuels. It should not be a convenient scapegoat for global issues beyond our control."

A World Bank report issued April 9 agrees with the UN officials. According to "Rising Food Prices: Policy Options and World Bank Response," increases in global wheat prices reached 181 percent over the 36 months leading up to February 2008, and overall global food prices increased by 83 percent.

Increased bio-fuel production has contributed to the rise in food prices, according to this report. Concerns over oil prices, energy security and climate change have prompted governments to increase bio-fuel production and use leading to greater demand for raw materials including: wheat, soy, maize and palm oil.

Food price hikes are also linked to higher energy and fertilizer prices, a weak dollar and export bans.

The Group of Eight, G8, will take up this matter at its annual meeting in July. The meeting will be attended by the leaders of the eight countries - Canada, France, Germany, Italy, Japan, Russia, the United Kingdom, and the United States - the same countries said by Ziegler to be on a "criminal path."

Prime Minister Yasuo Fukuda, as chair of the G8, expressed his intention to raise the matter at the G8 Hokkaido Toyako Summit in letters to UN Secretary General Ban Ki-moon and World Bank President Robert Zoellick on April 18.

Rapid increases in the large-scale production of liquid biofuels in developing countries could increase the marginalization of women in rural areas, threatening their livelihoods, according to a new study by the UN Food and Agriculture Organization, FAO.

"Unless policies are adopted in developing countries to strengthen the participation of small farmers, especially women in biofuel production by increasing their access to land, capital and technology - gender inequalities are likely to become more marked and women's vulnerability to hunger and poverty further exacerbated," said Yianna Lambrou, co-author of the paper, "Gender and Equity Issues in Liquid Biofuels Production - Minimizing the Risks to Maximize the Opportunities."

"Biofuel production certainly offers opportunities for farmers - but they will only trickle down to the farm level, especially to women, if pro-poor policies are put in place that also empower women," said Lambrou.

Analysis being carried out by the world's largest international food aid organization supports World Bank estimates that about 100 million people have been pushed deeper into poverty by the high food prices.

The UN World Food Programme, WFP, aims to feed 73 million people globally this year, but the agency now estimates it needs at least US$500 million more than anticipated last year to meet its 2008 operational budget of US$3.4 billion.

The half-billion dollar increase is solely due to the sharp hike in food and transport costs over the last few months.

WFP Executive Director Josette Sheeran of the United States says that high food prices are creating the biggest challenge that WFP has faced in its 45 year history, a "silent tsunami" of hunger.

Sheeran said that WFP could only fill a cup with half the food that it could last year because of rising food prices.

"The response calls for large-scale, high-level action by the global community, focused on emergency and longer-term solutions," she said. WFP is urging a comprehensive approach where all parties, from governments to UN agencies to nongovernmental organizations, all work together. Alongside other partners, WFP will follow a three-track response. In the short term, WFP will seek full funding for targeted food safety nets and mother-child health programs in extreme situations. School feeding programs will be scaled up and used as a platform for urgent, nutritional interventions.

In the medium term, WFP will offer its huge logistics capacity to support life-saving distribution networks. Every hour of the day, WFP has 30 ships on the high seas, 5,000 trucks on the ground and 70 aircraft in the sky, delivering food to the hungry. Cash and voucher programs will be supported and so will local purchases from small farmers, helping them to afford inputs and sustain livelihoods;

In the longer term, WFP will support policy reform and provide advice and technical support to governments engaging in agricultural development programs.

Many governments are already taking action. Some are expanding targeted safety nets, such as cash transfer programs to vulnerable groups, food-for-work programs, or emergency food aid distribution. Several countries have lowered tariffs and other taxes on key staples, in order to provide some relief to consumers.

Other countries have put in place export bans, which are detrimental to food importers and reduce incentives for production.

Food crop prices are expected to remain high in 2008 and 2009 and then begin to decline, but they are likely to remain well above the 2004 levels through 2015 for most food crops.

Biofuels Halt Would Ease Food Prices - Ag Group

PlanetArk US

30th April 2008

WASHINGTON - A moratorium on global grain- and oilseed-based biofuels would help ease raging wheat and corn prices by up to 20 percent in the next few years, a leading agriculture research group said on Tuesday.

"Our models analysis suggest that if a moratorium on biofuels would be issued in 2008, we could expect a price decline of maize by about 20 percent and for wheat by about 10 percent in 2009-10. So it's this significant," Joachim von Braun, who heads the International Food Policy Research Institute (IFPRI), told reporters in a briefing.

"There are biofuels and there are biofuels, good and bad ones ... waste-based and sugarcane-based can be very good," von Braun said. The role of burgeoning biofuel production, which diverts food crops like corn to make ethanol, has become a sharply divisive issue in the United States and elsewhere as the world grapples with a dramatic shock in food prices.

The soaring cost of basic staples like milk and bread has sparked unrest and deepened political instability in many corners of the developing world.

Biofuel supporters in the United States call the ethanol criticism wrong-headed and see the technologies as a needed alternative to America's dependence on foreign oil.

That is especially important, they say, with oil prices breaking new ground close to $120 a barrel.

US food prices are expected to jump by up to 5 percent this year. At the same time, about a quarter of the US corn crop will go toward ethanol.

Yet the Bush administration sees energy, not ethanol, as the biggest price driver, and describes a future for biofuels that leans heavily on alternate sources like switchgrass.

"The truth of the matter is, it's in our national interest that we -- our farmers -- grow energy, as opposed to us purchasing energy from parts of the world that are unstable or may not like us," President George W. Bush said on Tuesday.

BACKLASH BREWING?

With more costly food and fuel exacerbating the pain of a slowing economy, and the ranks of needy Americans receiving government food vouchers on the rise, a backlash appears to be taking root in the United States.

Some state governments are publicly reconsidering their ethanol policies, and a few big meat and poultry companies are asking for steps to cool the high cost of animal feed.

In Von Braun's eyes, crops like sugar cane offer greater promise for biofuels. "The opportunities of agriculture being an energy producing sector should not in principle be discarded," he said.

World leaders have coalesced around the need for an urgent fix to the deepening food crisis. The United Nations, for its part, is pleading with donor countries to pad strained food aid budgets and help avert a spike in global hunger. The source of this "perfect storm" in global prices is usually attributed to the confluence of several factors, including poor weather in exporting nations, increasing demand in growing nations like India and China, and biofuels. Von Braun also said that changing supply-and-demand dynamics had been driving soaring crop prices through the end of last year, but that market speculation and government steps to curb prices -- such as export bans -- had taken on an increasingly influential role in 2008. "Especially in the last couple of months, price increases far exceeded what global supply and demand would suggest to you. That's then a response to government erratic trade policies, the export bans, and the opening up the opportunities also for speculative trading," he said.

(Additional reporting by Russell Blinch in Washington; Editing by Marguerita Choy)

Story by Missy Ryan

REUTERS NEWS SERVICE

MAC: Mines and Communities

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Biofuels & the "silent tsunami": what's mining got to do with it? London Calling explains…….