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The new biofuel republics

Poor developing nations are to feed the voracious appetites of rich countries for biofuels instead of their own hungry masses, and suffer the devastation of their natural forests and biodiversity.

The next European colonisation has begun

The end of cheap oil and the impending fuel crisis have convinced the European Union and the United States to seriously tackle their long-standing and worsening “addiction to oil”, not by kicking the habit, but by guzzling biofuels instead. These “carbon neutral” fuels – biodiesel or bioethanol - make even committed environmentalists feel good about getting into their SUVs, as they do not contribute to carbon emissions. Burning biofuels simply sends back into the atmosphere carbon dioxide that the plants took out when they were growing in the field. The snag is that there simply isn’t sufficient arable land on which to grow all the biofuel crops needed to satisfy the voracious appetites of the industrialised nations.

So, the next phase of colonisation has begun. The industrialised countries are looking to the Third World to feed their addiction: the land is there for the taking as is cheap labour, and the environmental damages of large plantations, biofuels extraction and refining can all be outsourced, exactly as they were in the extraction of crude oil. Brazil is already currently the main supplier of bioethanol to the United Kingdom, and is looking to greatly increasing its exports elsewhere (see Box).

Ethanol in Brazil

Brazil’s national ethanol programme (ProAlcool) began in response to the oil crisis of the 1970s, and ethanol now accounts for 40 percent of Brazil’s driving fuel. The country’s ‘flex fuel’ car fleet is the only one in the world that can use 100 percent of either ethanol or gasoline. Brazil’s ethanol production was 15.9 billion litres in 2005, second only to the United States, and more than a third of the global production.

Until recently, Brazilian ethanol has been produced for domestic consumption. But in 2004, exports more than doubled to 2.6 billion litres. In 2005, the futures market for sugar rose by 62 percent on the back of rising international demand for ethanol. Brazil is exporting to US, India, Venezuela, Nigeria, China and Europe. It is negotiating with Japan to export ethanol to it after Japan authorized the substitution of up to 3 percent of gasoline with ethanol to help meet its Kyoto Treaty commitments.

Already the logistics of distribution, rather than productive capacity, is limiting the expansion of Brazil’s ethanol exports, and creating a demand for building ports with storage tanks and loading facilities, and improving railway and pipeline links between the ports and sugar-producing regions. A new ethanol port in Santos will increase Brazil’s export capacity to 5.6 billion litres by the end of 2006.

Companies dedicated to biodiesel have set their sights on countries in Latin America, Africa, Asia and the Pacific, where they can also obtain raw material at competitive prices.

UK-based DI Oils predicted in 2004 that the world market for biodiesel would grow by 14.5 percent annually to 2.79 million tonnes by 2010. The Asia Pacific operations of the company, based in Manila, will provide the Philippine Coconut Authority with the opportunity to meet the surge in biodiesel demand from Japan, China, Korea, Taiwan and Australia.

DI Oils has fastened on jatropha, a fast-growing, high-yielding tree that can be planted in semi-tropical areas on “wasteland and irrigated with sewerage water”. According to its CEO, the company already has plantations totalling 267 000 Ha in Ghana, Madagascar, South Africa, India and the Philippines, and intends to expand to 9 million ha. The Indian government announced a national biodiesel purchase policy in October 2005 that would enable farmers and biodiesel producers to get a support price of Rs 25 per litre for jatropha oil, and intends to bring one million ha of land under jatropha cultivation to supply blended diesel within the next few years.

Biodiesel has also provided a much-needed outlet for the glut of genetically modified (GM) crops that consumers are rejecting worldwide.
President Lula of Brazil has declared that GM soya is to be used for biofuels and “good soya” for human consumption. Argentina also has plans to transform GM soya into biodiesel.

The biodiesel industry says that for processing biofuels, large refining plants have to be constructed close to agricultural areas or forests, where the raw material is grown. The biodiesel will then have to be transported to filling stations in the same way as oil.

The oil industry will want to maintain control over the distribution of fuels, and will enter into an agreement with these new companies, as in many cases the supply chain can be very complex.

Everybody wins?

Biodiesel is projected as a business in which everybody wins. The European emissions of CO2 decreases, and third world countries increase their exports and improve the quality of life of their rural populations.

The reality is something else. It is said that during the growth of the crop, the plants absorb CO2 from the atmosphere. This is true of what was growing before the plantation was established. As the industry has plans of expanding exponentially, it is likely that they will begin to occupy primary or secondary forested areas, as has already happened with the soya plantations. Soya plantations have displaced the forests of el Chaco in Argentina and the forests in Pantanal, Atlantic and Chaco areas in Paraguay. Even more dramatically the Amazon, Pantanal, and Atlantic forests in Brazil have all been cut down for soya. The net CO2 balance is therefore strongly negative.

Additionally, other greenhouse gases are generated as a product of the crop itself, the processing, refining, transport and distribution of the fuel. It looks increasingly likely that biofuels is a net contributor of CO2 and other greenhouse gases into the atmosphere.

As regards the benefits to the producers of the biofuel crops, these can be extremely negative.

First, the destruction of forest and other original vegetation has already happened; and if these crops were to expand as intended, they could threaten food security and food sovereignty of the local populations, because farmers would stop producing food crops for the population and instead concentrate on producing “clean fuels” for Europe.

The production of soya in Argentina could increase to 100 million tonnes, which involves a huge environmental and social cost to the Argentinean people, such as the displacement of rural populations, growing deforestation and desertification of soils and hence greater hunger and social inequity.

Large-scale agriculture, such as is needed to comply with the demand for biofuels is highly dependent on oil derivatives such as fertilisers and pesticides, which, apart from producing CO2 emissions, are highly polluting.

The predictions for Brazil are alarming, as this country could become the world leader in the substitution of fossil fuels with biofuels, with all the impacts this entails. In Brazil, ethanol has been obtained so far from sugarcane, but the expansion of soya is happening as Brazil is experiencing a boom in exporting sugarcane ethanol. Sugarcane and soya plantations may well compete for land, making it almost inevitable that more forests will be cut down to accommodate the growth in both.

Recently, the Spanish government of Zapatero announced that Repsol will install a biodiesel plant in León. It is predicted that the raw material will be obtained from oily crops and will come from regions where labour and land is cheap and where GM crops are permitted, i.e., in the Southern Hemisphere.

In other words, the poor developing nations will be forced to feed the voracious appetites of rich countries for biofuels at the expense of their own hungry masses and suffer the devastation of their natural forests and biodiversity.


A fully referenced version of this article is posted on ISIS members’ website. Details here

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