Ethanol and a booming demand for biofuels are turning the entire global food chain upside down. In a series of articles in recent weeks, the Globe and Mail has explored how demand for ethanol is affecting everything from popcorn to yogurt, wine and chicken prices.
The Globe's European correspondent Eric Reguly explored the issue Friday, saying the poor are most vulnerable to rising food prices.
"Biofuel is suddenly a big business and demanding the attention of farmers everywhere," he wrote.
"In the United States alone, some 100 ethanol plants are under construction and vast amounts of corn are being grown to supply them. Soaring biofuel production is at least partly blamed for food inflation.
"There is no doubt food prices are climbing rapidly. Nestlé chairman Peter Brabeck-Letmathe told the Financial Times this month that food prices are set for "significant and long-lasting inflation." The International Monetary Fund recorded an unprecedented 23-per-cent rise in food prices in the past 18 months.
"Left on its own, the market in time would find a balance between food and fuel production. As it is, the billions in subsidies are encouraging a dramatic rise in biofuel production that would not otherwise occur.
"This is partly why the UN food agencies are worried. Too much biofuel is coming to the market too quickly and the casualties might be the poor who can't afford the sharply rising food prices."
Eric and other Globe reporters were here Monday to take your questions.
Eric joined the Globe in 1997, writing the paper's main business column from Toronto. In April, he became the Globe's European business correspondent, based in Rome. Eric has won several awards for his work, including, in 2007, the Hyman Solomon Award for Excellence in Public Policy Journalism.
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Tavia Grant, globeandmail.com Eric, thanks for joining us today all the way from Rome, just before dinner time. You've written about ethanol for more than a year, and even appeared on The Daily Show with Jon Stewart show, refusing to hug Corn Cob Bob. Nowadays, the economics of ethanol seem to be making headlines every day in stories that go well beyond agriculture, into food, globalization and politics. It's a fascinating topic, one set to reshape many rural communities and possibly the entire food chain. We've got a lot of questions, so here we go:
D Mores from Toronto Canada writes: Eric, why are people so passionate or opinionated about alternative fuels? Every time an article on this topic comes up, there are lots of people asking questions and lost of comments being posted. I don't see this level of feeling or feedback in issues like garbage recycling, acid rain, or toxic chemicals being dumped in the great lakes. Why?
Eric Reguly, Globe and Mail: Three reasons, in my opinion. The first is that alternative fuels hit you in the stomach, so to speak. This is about turning food into fuel and we all care about food. The second is that alternative fuels are in your face while oil rigs and the oil sands are largely hidden from view. We drive by pretty corn fields all the time and now we have to ask: Is the corn being grown for food or to keep my car going? The third is the sense that we can influence alternative fuel policy because it still qualifies (at least in Canada) as a niche industry, that it can be controlled before it turns into monster with a life of its own. We all know that acid rain, global warming and the like are huge problems. But most of us feel it's so big we are virtually powerless to do anything about it.
