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Palm Oil — The Southeast Asia Report

Dave Cohen, The Oil Drum
In an effort to broaden our coverage at The Oil Drum, this Southeast Asia report focuses on the tragic consequences of cultivating palm oil to produce biodiesel fuel.

It is a sad story in which the cure is sometimes worse than the disease. ..
(30 Jan 2007)
Valuable round up of palm oil economics, ecology and politics in SE Asia. -LJ

Food vs. Fuel

Business Week
As energy demands devour crops once meant for sustenance, the economics of agriculture are being rewritten
…Corn is caught in a tug-of-war between ethanol plants and food, one of the first signs of a coming agricultural transformation and a global economic shift. Ever since our ancestors in the Fertile Crescent first figured out how to grow grains, crops have been used mainly to feed people and livestock.

But now that’s changing in response to the high price of oil, the cost in lives and dollars of ensuring a supply of petroleum imports, and limits on climate-warming emissions of fossil fuels. Farms are energy’s great green hope. “Economics, national security, and greenhouse gases have created a perfect storm of interest,” says John Pierce, vice-president for bio-based technology at DuPont, (DD ) which is making fuel and chemicals from plants.

…The consequences, while still uncertain, are impossible to ignore

…Whether this is good or bad is a matter of intense debate. At one extreme is Lester Brown, president of the Earth Policy Institute. He warns of a coming “epic competition between 800 million people with automobiles and the 2 billion poorest people,” and predicts that shortages and higher food prices will lead to starvation and urban riots. “I don’t think the world is ready for this,” he says. Dow Chemical Co. (DOW ), which is turning soybeans into foam for furniture and car seats, worries about rising demand. “There’s only so much biologically based stuff around,” says William F. Banholzer, corporate vice-president and chief technology officer. … In addition, biofuels are expected to bring a rare permanent change in farm economics.

…Is all this really so bad? Pessimists, in fact, are a minority in debates about food vs. fuel. Lapp notes that food is now at its cheapest level, historically. “It’ll be easier to pass on the food increases because we’re spending a smaller portion of our disposable income on food than in the 1970s,” he says. And some experts even argue that a boost in food prices could be beneficial to Americans’ health.
(5 Feb 2007)
Contributor Michael Winks writes: “This provides balance, generally foreign to stories on this topic”
I agree with Michael that the reporting in the article is better than usual. However, higher corn prices affects people around the world, not just Americans – as witness the surge in the price of tortillas for Mexicans. -BA

Biofuels could damage environment, stymie development, says report

RA Butler,
In his State of the Union Address Tuesday night, U.S. President George W. Bush highlighted ethanol fuel production as a means to improve domestic security by reducing dependence on foreign oil while at the same time helping to fight global warming. ..

With all the enthusiasm it may seem that biofuels are the end-all solution. A new report argues that this is not the case. In its briefing, “International trade in biofuels: Good for development? And good for environment?” the International Institute for Environment and Development (IIED) cautions policymakers not to get caught up in all the hype. IIED warns that serious concerns still remain when it comes to the widespread adoption of these renewable energy sources.

“The global biofuels market offers important opportunities to bring together the economic, environmental and social agendas both in developing countries and globally,” writes Annie Dufey, author of the report. “However, a lack of coherence and coordination between the stakeholders and policy agendas involved at the interface between biofuels, trade and sustainable development could lead to biofuels providing a solution to one specific problem while simultaneously creating several others. It is therefore increasingly urgent to map a path for the global biofuels industry that supports sustainable development. Analysis is needed to integrate the above issues and to deliver concrete and timely recommendations to policy makers that will drive the sustainable development results of this new market.”

Dufey goes on to argue that international trade barriers, especially tariffs and subsidies, need to be relaxed to enable the developing world to reap the benefits of the emerging biofuels trade, while certification schemes need to be established to take account of the environmental and social conditions in such countries. She cites poor working conditions associated with the cultivation of some energy crops, especially sugarcane and palm oil), and says that large-scale biofuel production could well have serious environmental consequences as native ecosystems are replaced by the likes of soybeans, oil palm and sugarcane. ..
(25 Jan 2007)
The four page pdf briefing paper on the IIED report can be found

Fueling a New Farm Economy

Jake Caldwell, The Center for American Progress
Complex problems require detailed solutions underpinned by a clear vision of the future. When each of those problems individually seems almost intractable, the need for an overarching view of the desired outcome becomes all the more important. Without a doubt that is the case today when policymakers confront global warming, global poverty, energy security, and global free trade. ..

The first section, beginning on page 7, presents the current state of play in the U.S. biofuels marketplace and then offers detailed legislative proposals to further boost the burgeoning alternative fuels industry. The purpose: Rapidly and deliberately develop the next generation of advanced cellosic biofuels by:

-Targeting “green payments” to farmers for performing environmental services on their working lands, including growing dedicated energy crops, while decreasing our reliance on commodity-based direct payment subsidies.
-Rewarding farmers for agricultural practices that combat climate change.
-Increasing funds in the new farm bill for existing renewable energy programs.
-Encouraging farmer-owned-and-operated biorefineries and local-owned biofuel plant cooperatives.

The second section, beginning on page 12, analyzes in greater detail the advantages and some of the safeguards required in order to bring dedicated energy crops such as switchgrass, miscanthus, jatropha, and poplar to market as biofuels and bioproducts. ..
(19 Jan 2007)
Article discusses larger report (46pg pdf) by CAP that advocates policies to increase biofuels production in US. -LJ