Monday, October 15, 2007

Cereals dilemma: space for cereals or for birds

Cereals dilemma: space for cereals or for birds

Following on the heels of the coverage of “Ethanol dilemma: Fuel for vehicles or food for humans” last week on this page, the European Commission proposed to reduce the rate of set-aside of farmland to zero percent for the 2008 harvest year.

With the EU reserves for grain stocks on the low side, the solution was to put all available farmland in production but that did not go down well with wildlife watching organisations and BirdLife International, the global alliance of conservation organisations working together for the world’s birds and people, regretted the decision as the annulment of set-aside for 2008 could deal a severe blow to the already struggling farmland bird populations and other wildlife. The wildlife pundits pointed that the set-aside represents an important refuge for wildlife in intensive farming landscapes.

Speaking to New Europe, one wildlife conservationist wondered how much irreversible harm this rushed decision can do as it was noted that in the past the Commission has recognised the environmental benefits of set-aside and had promised to do a full assessment of it in the upcoming next year’s Common Agricultural Policy “Health Check.”

Moreover, the Spanish portal pointed out that the European Commission is stating that today only 1.7 percent of the cereal production is used for energy products but in reality everywhere in Europe there is a mad rush for development of entirely new plants for biodiesel and ethanol, using crude vegetable oils and grains as raw material. Obviously, the process will lead to a much higher percentage production needed for fuel mixings.

Moreover, a recent report of the OECD has highlighted that the European plans are set to strangle food markets as OECD recommended only three kinds of biofuels as preferable to oil: cane sugar to converted to ethanol, the by-products of paper-making and used vegetable oil and strange but true none of these feature prominently in the EU’s plans for biofuels.

In addition to this, the World Trade Organization is discussing the Brazilian complaint against the US agriculture subsidies including the topic “energy subsidies,” which attacks tax exemptions on diesel fuel and gasoline. With this new set of alcohol-induced WTO battle lines being drawn there will be increasing pressure on the EU and US to open their markets for ethanol.

Overall, the burgeoning ethanol industry is already generating a new wave of prosperity for rural towns around the globe. With major corn farmers pushing for more ethanol production as the industry see the creation of an enormous new market for their crop, giving corn prices the kind of lift they haven’t seen in years.

Last, but not least, there is a slim fallout on the family farmers in developing countries which grow corn and wheat on their 2-3 hectares farmland and they should be the first beneficiaries of the hike in cereal prices and they are worth to be rewarded for their hard labour but the closed markets of the EU and the US need to be opened sooner rather than later.

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