Fuelling the Food Crisis: Biofuels… and Imperialism

Image - Malnutrition is already endemic across the world, without further food price increases

At a time when global food prices are rising anyway, due to the short-term effects of freak weather conditions1 in key crop-growing areas like Australia, Canada and the Ukraine, and the long-term effects of the increased demand for meat and dairy products (which require far more grain for animal feed than would be needed to provide the same amount of energy if humans directly consumed the grain) by better-off sections of the populations of China, and, to a lesser extent, India, the competition for land for biofuels can only exacerbate the rise. All this, as the declining value of the dollar, the currency of international trade, pushes up food production costs and “farm gate” prices while speculative activity shifts from the subprime and associated sectors to the food sector. (See the preceding article.)

Ever since human beings began to grow their own crops and seek out sources of fuel, the competing demand these types of production put on the available labour also involved a growing interconnection between geographical areas and sectors of production. This interconnection was intensified when food was first produced or delivered using coal-powered vehicles. With the advent of biofuels2, the connection between these sectors has been reached an entirely new level. Now the two sectors are directly competing for the use of agricultural land, especially as many biofuels (e.g., maize, soybeans, sugar beet and cane - see Table on next page) are foods themselves. With half the world's population surviving on less than $2 a day, and 1.3bn on less than $1 a day3 (with consequent poor nutrition - see map on page 22), the last thing that is needed is more expensive food.

- % of global production Main producing countries
Sugar 51.0 Brazil, India, Pakistan
Corn/maize 35.75 US, China
Wheat 8.5 Germany, Spain, France
Others (mainly from cassava) 4.75 China, Africa, Thailand
World Biofuel Production - Global bioethanol market


- % of global production Main producing countries
Soya 42.5 US, Brazil, Argentina
Rapeseed 34.0 EU, Russia, Ukraine
Sunflower 8.5 EU, Russia, Ukraine
Palm 7.0 Indonesia, Malaysia, Thailand
Callow 4.25 US, Brazil, Australia
Waste oil 4.25 China, US
World Biofuel Production - Global biodiesel market


US ethanol production, imports and demand in 2007 (unit of vertical axis: 1000 US gallons), source: <a href=ethanolrfa.org" title="US ethanol production, imports and demand in 2007 (unit of vertical axis: 1000 US gallons), source: ethanolrfa.org"/>
US ethanol production, imports and demand in 2007 (unit of vertical axis: 1000 US gallons), source: ethanolrfa.org>

A Price Worth Paying?

The theory behind biofuels is that their use reduces the amount of greenhouse gases released into the environment by human activity, and thus retards global warming. This is because, according to the theory, burning biofuel only releases the CO2 into the atmosphere which was locked up in growing the crops used to produce the biofuel, so the production and use of biofuel represents a carbon-neutral cycle. The question "a price worth paying" is hardly worth answering if the carbon-neutral biofuel theory is not at least approximately correct. And it seems that it is not.

Carbon-neutral Deforestation?

The first point is that the carbon neutrality of biofuel assumes either that the land used for growing the source crop is already in use for agriculture (and so the use of the land for biofuels subtracts from its use for food production), or that the cost of converting the land (primarily through deforestation) to agriculture for biofuels is itself neutral. The latter is far from being the case. Even in strict scientific terms it is estimated that the conversion carbon cost will take 50 to 100 years to be covered by the carbon savings from the use of biofuels grown on the land in question (4), under favourable assumptions regarding those carbon savings. Consequently, biofuels will make global warming worse over the next 50 years. This can already be seen in the actions of the Brazilian state. According to Le Monde Diplomatique (July 2007) the Workers' Party (sic) Government headed by President "Lula", one-time hero of the anti-globalisers, is so far in the pocket of agribusiness monopolies like Cargill, Archer Daniels Midland etc that it has already re-classified 200 million hectares of land as degraded. In fact this land is occupied by cattle farms, indigenous peoples and subsistence farmers. These will be shoved aside as the grassland is burnt off to make way for the planting of sugar cane.

Even given the favourable assumptions, Righelato and Spracklen work out that replacing the consumption of an amount of petrol by an equivalent amount of biofuel produces a carbon saving one half to one ninth of that resulting from the alternative strategy of continuing to burn petrol but compensating for this by reforestation. And the above-mentioned assumptions regarding the carbon savings of biofuels are questionable. According to Nancy Stauffer, Laboratory for Energy and the Environment, MIT (5), the total carbon cost of using biofuel from maize (taking into the energy for fertilisers, harvesting and conversion of corn to ethanol, and the fact that energy available from ethanol is 30% less than that available from petrol), is roughly the same as burning fossil fuel.

The use of agricultural waste, or certain grasses with more cellulose than corn, look like being more carbon efficient than the use of corn, and will take less land from food production, but the technology for converting cellulose to fuel is not yet fully developed.

None of this has stopped a move towards the increased production of biofuels.

Fuel Security

A clear indicator of the trend for more biofuel production is given by Figure 1. This shows US monthly production, demand and imports of ethanol, one of the major biofuels, over 2007. There is a clear upward trend in production, resulting in an increase of 30% over a year, and this trend is mirrored by the demand curve. Although the trend in imports is not quite so clear, the decline is discernable, and is of 80% over a year.

The shift towards biofuel over two years is even more apparent: the increase in production over the course of 2006 was 35%. This year (2008) one-third of the US corn crop is destined to be turned into vehicle fuel.

But where does this trend come from, given that biofuels are far from likely to solve the world's problems with global warming?

It certainly is not a natural outcome of capitalist ‘market forces'. In fact there is nothing natural about agriculture in the major capitalist powers where state intervention is the norm. Biofuel production is no exception.

According to the IMF, the cost of support per litre of ethanol in 2006 was between $0.29 and $0.36 per litre in the US, $1 in the EU and Switzerland and $0.4 in Canada and Australia. State support for biodiesel varies between $0.2 per litre in Canada, around $0.6 in the US and the EU and $1 in Switzerland. The subsidy to biofuels is often greater than the cost of the fossil fuel equivalent. (In terms of energy unit costs petrol is calculated to cost $0.34 per litre and diesel $0.41.) (6)

We are not really witnessing the world's major powers subsidising production for the sake of the future of the planet. Rather, all the imperialist powers, especially the one with the most to lose - the United States - are obliged to seek an alternative source of energy to preserve 'security' (not the future existence of the planet as such but their own economic and ultimately military standing in the world).

Behind the rush to biofuels we have to look to old-fashioned oil production. In the first place, the world's imperialists are concerned about fossil oil running out, and don't want to be left without a substitute when this happens. In the second place, and more pressingly, the world is becoming a more dangerous place, in part because of a shift from the US dollar as the world's reference currency to other currencies (primarily the euro) undermines the US economy (as described in US Imperialism's 100 Years War? in Revolutionary Perspectives 45), and forces the US to more seriously consider military action across the world. This is precisely the motive for the invasion of Iraq. In this more dangerous world, the possibility that an imperialist power could be cut off from its sources of oil before they are exhausted becomes more likely. The US itself, for example, has been more and more reliant on oil imports since its own production peaked in the early 1970s. There was a secondary peak in the mid-1980s (due to new fields in Alaska and the Gulf of Mexico coming into production), but today's production is approximately half of the 1970s peak and the US now imports 56% of the crude it uses, a figure that can only rise unless a substitute energy source is deployed.

The Anarchy of Capitalist Production

As capitalism developed, the effective unit of production grew, without entirely overthrowing the existence of production, and competition, on the previous scale. At first, quite small capitalists fought it out between themselves, and "one capitalist killed many". This brought about the centralisation of capital and led to the emergence of monopoly capitalism. At the same time, capitalist planning was facilitated, both within the larger units, and through the overt or covert emergence of government or self-regulation.

However, this planning, far from abolishing the anarchy of capitalist production, merely made it appear on a larger scale. Countries, and groups of countries, produce without planning between themselves, leading to waste production on an international scale. Even when there is planning, this proves to be ineffective, and much needed international regulation turns out to be totally powerless. (In a situation of economic crisis, when competition is sharpened, this is even more the case.)

For example, Germany is shifting to coal-burning power stations which will depend on Carbon Capture and Storage (CCS) (7) technology if Germany is to reach its emissions targets by 2020. But CCS technology is not expected to be ready until 2030, and that date is likely to be shifted backwards by the US government pulling out of a CCS pilot at Mattoon, Illinois, BP abandoning its pilot in Scotland (citing government indifference) and the EU's failure to act on its promises to have demonstration plants operating by 2015. (8)

So, Germany "plans" to rely on things which are not going to happen (because it is profitable to do so), because what is "planned" to happen elsewhere does not yield enough profit to be put into action...

Returning to biofuels, if there was an ounce of rationality about capitalism the immediate human consequences of shifting the use of agricultural land from food production towards the supply of ethanol and diesel to the major imperialists would have been obvious. Soya (the main source of biodiesel) and maize (a prime source of ethanol) in particular are staple food crops whose supply has been reduced, thus exacerbating the food price rises caused by the factors mentioned above. Now that capitalism is faced with a full-blown food crisis voices are being raised against the whole policy of biofuels. In April a UN food agency representative described biofuels as a “crime against humanity” while dissenting scientific voices are now being given a hearing. The UK's prestigious Royal Society, for example, has issued a report critical of government support for biofuels which it said risked failing to deliver significant reductions in greenhouse gas emissions, and could be environmentally damaging. Interestingly enough the report acknowledges that biofuels could strengthen “energy security” - i.e. the political object, in this case of the EU, but that the EU's biofuels directive risked encouraging technologies "that miss opportunities to deliver reductions in greenhouse gas emissions". In other words, the supposed goal for developing biofuels in the first place will not be achieved. But then, this is the madness of capitalism and only leads to another capitalist racket: the emissions trading system which now warrants a market index of its own and is proving very profitable for some without carbon emissions being reduced one iota.


It would be unrealistic to expect that things would be perfectly planned under any social order. However, capitalism has an inbuilt planlessness. Its ruling class is compelled to compete or go out of business, to produce without any certainty that what is produced will fulfil a need or be allowed to fulfil that need by the competition, or the lack of production of other things by other capitalists. If its planlessness is eliminated at one level, it reappears at a higher level. It is inherently wasteful.

Capitalism is incapable of putting anything, let alone the environment, before profit, because, without profit, the capitalist ceases to be a capitalist. Capitalism compels the capitalists to be egotistic, in that they have to put their narrow class interest above the interests of society as a whole.

Communism, on the other hand, permits and demands planning on a global scale. (9) In particular, it permits the planning which will rescue humanity from the worst consequences of capitalism's socially enforced egotism.


(1) Assuming the best case. Assuming the more likely worst case, these conditions are no longer freak weather, but about to become the new norm as a result of climate change, and their effect will no longer be short-term.

(2) Defined as the use of material derived from recently grown crops or living animals as fuel, as opposed to the similar exploitation of long-dead plants and animals as fossil fuel.

(3) See, e.g., globalissues.org

(4) See newscientist.com -biofuels-burn-oil-and-plant-forests-instead.html4 .

(5) web.mit.edu .

(6) IMF Global Subsidies Initiative, globalsubsidies.org .

(7) Basically, carbon dioxide is captured at the power station chimney, and is then stored underground.

(8) See New Scientist, "Cleaning up coal" (p36, 29th March 2008) and "Come clean on coal" (p5, 9th February 2008).

(9) It is not argued for a single minute that communism is just planning. Planning becomes possible in a classless society, and this classlessness is the single most important characteristic of communism.

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