US energy policy undermines hunger fight

Photo: ActionAid

As corn prices surge on the Chicago stock exchange, ActionAid is calling on the US government to rationalise its energy policies to avoid undermining its own crusade to end hunger.

Against a backdrop of rising demand on corn for biofuels, predictions of a smaller-than-expected US corn harvest this year have sent corn prices soaring.

"Propping-up the US biofuels market with heavy tax breaks – and promoting increased use of biofuels – is having a knock-on effect on global food prices. This is totally inconsistent with ambitions to end hunger," said Peter O'Driscoll, Executive Director of ActionAid USA.

"Given the leadership the US has shown on investing in agriculture to promote food security, it must now align its energy policies to avoid cancelling out efforts to protect the people most vulnerable to food price increases."

A third of the US corn crop, the largest in the world, will go into production of ethanol fuel this year – 4.6 billion bushels, up 200 million bushels from last year.

The 2007 US Energy Bill mandates an increase in ethanol consumption from the current 14 billion gallons to 36 billion gallons by 2022 threatening a further squeeze on corn harvests.

The US government has also given the go-ahead for a 50% increase in ethanol content of fuel at the pump, from 10 to 15% of the mix. http://www.ft.com/cms/s/0/4f7e3d58-d6fd-11df-aaab-00144feabdc0.html

ActionAid is urging the Obama administration to reconsider subsidies and renewable fuel standards that promote biofuels.

Speaking from a UN meeting of food experts and governments in Rome, ActionAid's Head of Food Rights Ruchi Tripathi, called on governments to start acting consistently to control food price volatility and avoid perpetuating hunger.

"There is a bigger picture here. This Saturday is World Food day – but for 925 million people it will be another debilitating day without enough to eat. ActionAid is joining women farmers in 17 countries who are meeting their politicians to demand investment in seeds, land, tools and irrigation schemes,"

"Support for women small holder farmers is an critical step towards ending hunger – but this must not be undermined by policies that push up food prices. There needs to be a consistent global plan to build up food reserves, curb commodity speculation and protect poor farmers from land grabs. This includes regulating biofuel production to avoid food price hikes."

ActionAid research on food prices ahead of World Food Day shows that US corn price rises come on top of continuing rising food prices in poor countries, including rice prices in Vietnam, Myanmar, Malawi, China and Bangladesh, wheat flour in Pakistan wheat flour and Nepal, bean prices in Uganda this year. In Kenya Maize prices rose to $197 US per tonne from July to August: an increase of $23 US per tonne from July.

An ActionAid report released last month revealed that hunger could be costing poor nations $450 billion a year - more than ten times the amount needed to halve hunger by 2015 and meet Millennium Development Goal One. The report Who's really fighting hunger? (click to download) shows the real dates countries will meet MDG1 and scores nations on their efforts to fight hunger.

Media enquiries:
Mark Chenery, Communications Manager, ActionAid Australia(02) 9565 9106
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