Experts: EU, US must reconsider biofuel policy

Europe and the U.S. must reconsider their biofuel policies because of rising food prices around the world, aid officials and food policy experts said Thursday.

Speaking at an international conference on food supplies, many also warned that some countries' restrictions on agricultural exports were severely hindering access to food and called for more investment to increase food production in the developing world.

EU agriculture commissioner Mariann Fischer Boel responded by promising to present plans next Tuesday for new financial aid to farmers in developing countries to buy fertilizers and seeds to boost production. She gave no details on the value of the package but said it would come from unspent EU farm funds.

Fertilizer prices in particular have shot up at an even faster rate than food prices over the last 18 months, making it difficult for Third World countries to increase agricultural output, the U.N. Food and Agriculture Organization said.

Fischer Boel said while cereals were twice as expensive in real terms during a similar food shortage in the mid-1970s, the current crisis was different because prices have skyrocketed so quickly.

"We must do our very best to increase production in the developing countries," she said.

Price speculation, sharply higher fuel costs, increased demand and a focus on producing biofuels instead of food have forced food prices higher. The number of hungry people increased by about 50 million worldwide to more than 850 million in 2007, according to the U.N. food agency.

John Holmes, U.N. undersecretary-general for humanitarian affairs, singled out Somalia, Ethiopia and western African countries such as Guinea as being the worst hit by food shortages and rising prices.

He said the EU must "look again" at its plan calling for biofuels to fuel 10 percent of cars and trucks by 2020 - part of a broader commitment to provide 20 percent of all energy in the EU from renewable sources, up from 8.5 percent now.

Joachim von Braun, the head of the International Food Policy Research Institute, said Europe and the U.S. must "correct political errors" made when they gave the green light to an increased production of biofuels without properly researching the effects on food supplies.

U.N. officials have called on countries to ensure that biofuel crops do not compete with food crops and do not encourage deforestation.

Environmentalists, who once hailed biofuels as a key tool in fighting climate change, now believe their production has encouraged deforestation. The diversion of food crops such as canola, corn, soybeans and sugarcane to biofuels has been blamed as an important factor in the sharp rise in food prices over the past year.

Conference participants also called for an end to trade-distorting farm subsidies in Europe and the U.S.