Biofuels Are Just One Factor in Food Prices, Says Report

Looks like the Wall Street Journal is going have to write a flaming op-ed about the research firm New Energy Finance now, too. While earlier this week the WSJ lambasted Vinod Khosla for down-playing the role of ethanol in the food crisis (we reprinted Khosla’s rebuttal here), according to research from New Energy Finance out next week, biofuels are “far from the dominant” factor in rising food prices.

Yes, they’re a contributing factor, leading to an 8.1 percent increase in global average grain prices, but other factors like increases in input costs, changes in consumption habits and increases in global population have played a much larger role, says New Energy Finance. In Brazil, the case was a bit different — rising oil prices drove domestic demand for ethanol and added a 70 percent increase in sugarcane prices by mid-2006. Gulp. But overall the price of food staples has risen by up to 244 percent since 2004, notes the research firm.

What does this all mean? We all know that food crops are not the best option, and even growing crops for fuel in general seems to be getting dated (Hail the garbage biofuel revolution!). But more than anything the biofuel industry needs an image makeover. If done in sustainable ways, biofuels can provide an option for fighting global warming — but if they don’t have public and political support, they won’t even make it to the cellulosic stage.