Thursday, July 03, 2008

Biofuels cause food prices to soar

Photo courtesy of The Guardian

A lead article in the Guardian reports that a leaked World Bank paper estimates that the price of basic foodstuffs has risen 75%, due to the diversion of basic crops to biofuel production. It seems that the report has remained unpublished to avoid embarrassing the U.S. government (President Bush has said that biofuel has caused the price of food to rise by only 3%) and for fear of getting the World Bank into political hot water.

The report identifies three main factors in this enormous price rise. A third of the US's corn and half of the EU's vegetable oil now goes to biofuel; farmers are being encouraged to set aside land for biofuel crops; and speculators have got in on the act.

The Guardian has posted the report on its website.

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