The recent evolution of food prices is clear proof that biofuels have only a marginal impact on food prices, according to EU Farm Commissioner Mariann Fischer Boel.
Speaking this week at the Konrad Adenauer Stiftung research centre in Germany, she highlighted that food prices have fallen away from recent peaks while biofuel production has remained constant.
Fischer Boel explained: “Now we see clearly that last year’s media storm about biofuels was something of a red herring: and thankfully, that red herring has swum away.
“There has been no U-turn in biofuel policy in the European Union, the US or other large production regions, and yet agricultural prices have fallen a long way. So biofuel production was not the main driver of higher prices.”
Fischer Boel indicated that this should mean no turning back on EU biofuels policy, constituting a crucial element in the EU’s environmental and fuel security goals.
December’s agreement on the EU Climate and Energy Package granted biofuels an important role in the EU energy mix, setting member states a target of drawing at least 10% of transport fuels from biofuels and other renewable sources by the year 2020.
Prices have halved
Worries about the impact of biofuels grew last year as food commodity prices hit major peaks, but Fischer Boel explained that prices have now halved for skimmed milk powder and soft wheat since spiking in 2007 and 2008.
While dismissing the biofuel factor, Fischer Boel highlighted the impact of other potentially distorting elements in the food market.
She acknowledged that energy and labour costs have major effects on the final prices of food, but reiterated her calls for vigilance in order to ensure drops in farm gate prices are passed on to consumers in the same way that increases in raw commodity prices are.
“There’s not much that the CAP can do about issues like this one,” she warned, recalling the recent food price roadmap launched by the Commission to encourage national competition authorities to crack down on anti-competitive actions in the food supply chain.
From FO Licht’s World Ethanol & Biofuels Report