‘Tortilla crisis’ highlights concerns over biofuels

[mailchimp_signup][/mailchimp_signup]Just days after EU energy ministers recommended a mandatory 10 per cent minimum target for biofuels in transport by 2020, thousands
of demonstrators marched through Mexico City protesting at a rise in tortilla prices caused by rising American demand for ethanol which
has pushed up the price of corn on which Mexicans depend for their basic food.

Keith Collins, the chief economist at the US department of agriculture, told the Financial Times newspaper that consumers will have to
pay more for good as demand from biofuels manufacturers pushes up the prices of corn and other grains.

The FT also reported a warning by the Dutch brewer Heineken that growing demand for the crops that make biofuels was likely to reduce
the supply of barley and hops, and thus increase the cost of beer.

T&E director Jos Dings said: “Concerns about beer will not be too high on most people’s list of priority issues, but food should be, and
the ‘tortilla crisis’ could be the first of many. Our concern about blind targets for biofuels is that they will create a demand for certain crops
that has the potential to threaten the survival of certain communities as these biofuel crops will replace food grown for local people. It
appears it is already happening.”

• German biodiesel producers have accused the government of threatening their livelihoods by introducing a tax on biofuels. The German
biofuels industry association VDB said output had fallen by 30-40% since the tax was introduced in August.

This news story is taken from the March 2007 edition of T&E Bulletin.