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Is race for biofuel criminal?
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April 30, 2008 16:24 IST

The biofuel policies of the United States and European Union have come in for severe criticism by the United Nations recently.

According to United Nations special rapporteur on the right to food, the US and EU have taken a criminal path by contributing to an explosive rise in global food prices through using food crops to produce biofuels.

Addressing mediapersons in Geneva, Jean Ziegler of Switzerland said fuel policies pursued by the US and the EU were one of the main causes of the current worldwide food crisis.

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

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

Companies such as Cargill, which controls a quarter of all cereal production, have enormous power over the market, the UN official said.

Hedge funds are also making huge profits from raw materials markets, and called for new financial regulations to prevent such speculation, the official added.

He also warned of worsening food riots and a horrifying increase in deaths by starvation before reforms could take effect.

In another development, a nutritionist with the UN World Food Programme said 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.

Meanwhile, Brazilian President Luiz Inacio Lula da Silva blasted wealthy nations for their punitive agricultural tariffs and urged them to 'stop your hypocrisy' and start buying Brazilian biofuel.

"We have said that if we want to achieve success in the Doha Round (of World Trade Organization negotiations), then rich countries must lower their agricultural tariffs for poor countries' products entering their markets," Lula said.

"So, stop your hypocrisy and start buying biofuels," he said. Lula also said it was inconceivable that wealthy nations have tried to pin the blame on biofuels for the explosive rise in global food prices, which have led to violent riots in some poor countries.

Sugar-based fuel produced in Brazil is being fingered for causing global price surges, an accusation fiercely rejected by Lula.

Brazil is the world's second largest ethanol producer, after the United States whose ethanol is corn-based.

"The world does not produce biofuels and has 800 million people who go to sleep hungry," he said.

"Those who criticize biofuels have never criticised the price of oil. The developed world imports oil with no tariffs, yet they place an absurd tariff on Brazilian ethanol," Lula said.

Lula said such a situation exists because Brazil's role in international trade has steadily transformed from minor role to major player.

"We are the largest exporter of coffee, orange juice, soy and beef," he said. "We can no longer accept the argument that rich countries want to impose on us."

Lula recognized that the market for sugar-based ethanol would surge if there were greater public support for the production of fuel from biological materials.

In the Brazilian biofuel industry, companies which produce agro-based fuels enjoy major tax breaks.


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