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Brazil economics
The biofuel dilemma
 Saying
that the recent global food shortages and the raise in inflation in the world
happens because of biofuels production is "an exaggeration". This opinion
is shared between Brazil's current president, Luiz Inácio Lula da Silva, and also
by the former president of the country, Fernando Henrique Cardoso. The latter
one considers that the crises comes from a sudden raise in the world demand for
food. But he says he believes the crisis is temporary
By GABRIELA ZAGO
From Pelotas, BRAZIL
Biofuel production
as an alternative for providing energy has recently started to be contested all
over the world. One of the reasons is that it is a fuel produced out of elements
that could be used for alimentation. In the center of the attacks, there's Brazil,
a country that is the second largest producer of biofuels in the world (#1 is
United States), even though it faces an historical problem of hunger and poverty.
A simplistic reasoning leads to the inevitable question: how come they use food
to produce fuel, and let millions of people to stay in hunger?
Brazil
is the 5th largest country in the world, and has the 5th largest population, with
183.987.281 inhabitants (IBGE,
2007). Located in South America, it is, economically, only #8 in the
world (according to the World
Economic Outlook Database, from FMI). The country is the second largest
producer of biofuels in the world, and the world's largest exporter. Brazil is
also considered the first country to have a sustainable biofuels economy. The
production is made from sugar cane.  United
States (#1 producer) and Brazil, together, account for 70% of the world's production
of ethanol.
Recently, the United
Nations Special Rapporteur on the Right to Food, Jean Ziegler, have blamed the
transformation of food in biofuels, as well as financial speculation, of being
the main reasons for the higher prices for food supplies. As he points out, biofuels
could be considered a "crime against a part of the humanity", since
the transformation of food in fuel led to basic products to have risen in price.
The general-secretary of Unctad (United
Nations Conference on Trade and Development), Supachai Panitchpakdi,
for instance, replied saying that biofuels are not the biggest villain in this
history. For him, recent global food shortages are more a result of a bad infrastructure
of distribution of agricultural products rather than the rise of the basic products
caused by biofuels.
Saying that the recent global food shortages and the
raise in inflation in the world happens because of biofuels production is "an
exaggeration". This opinion is shared between Brazil's current president,
Luiz Inácio Lula da Silva, and also by the former president of the country, Fernando
Henrique Cardoso. The latter one considers that the crises comes from a sudden
raise in the world demand for food. But he says he believes the crisis is temporary.
The situation is not exactly that bad. Yes, Brazil has a large production
of "food" (sugar cane, for instance) to be converted in biofuel. But
there's also a great agricultural production of food for human consumption, not
to mention that there are still large portions of land underused in the country.
 According
to what Antonio Sergio Oliveira Santana, executive manager of Petrobras
(a semi-public Brazilian energy company), said on May 7th at the first day of
the Amsterdam Conference on Sustainability and Transparency, out of the 350 million
hectares available for sugar cane cultivation in Brazil, only 75,6 million is
currently in use. From those, 72 million are used for agriculture, and 3,6 million
goes for the planting of raw material for the manufacture of biofuels.
In
order to avoid future problems, the Ministry of Agriculture of Brazil is planning
how to delimitate the areas suitable for planting sugar cane for biofuel from
those areas to be used for food production. The separation would prevent the production
for biofuels to grow disproportionately and end up overlapping the production
of food.
Also, Brazilian biofuel is produced from sugar cane, which is
something that is not essential in everyone's alimentation. It is different, for
example, from North America's biofuel, produced from corn and soybeans, ingredients
that are fundamental in many diets.
European Union plans to, until 2020,
be using at least 10% of alternative fuels in all fuels. However, if exportation
become more attractive for producers from countries like Brazil, there are concerns
in the rest of the world that people will stop producing for alimentation, and
start to produce food for fuel, which could led to an even worse high on prices
for the same product as a food. That's why some segments are pressuring EU to
reduce expectations and wait a little more time before getting to that rate.
What seems more important - finding alternatives for producing fuels, even
though this means having to use food for that, or to using all agricultural resources
to (try to) produce enough food for everyone and avoid all the (inevitable) possible
hunger in the world?
(Published: 10.05.2008.)
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