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    In just four months, the use of biodiesel in the transport sector has substantially improved air quality in Metro Manila, data from the Philippines Department of Environment and Natural Resources (DENR) showed. A blend of one percent coco-biodiesel is mandated by the Biofuels Act of 2007 which took effect last May. By 2009, it would be increased to two percent. Philippine Star - December 4, 2007.

    Kazakhstan will next year adopt laws to regulate its fledgling biofuel industry and plans to construct at least two more plants in the next 18 months to produce environmentally friendly fuel from crops, industry officials said. According to Akylbek Kurishbayev, vice-minister for agriculture, he Central Asian country has the potential to produce 300,000 tons a year of biodiesel and export half. Kazakhstan could also produce up to 1 billion liters of bioethanol, he said. "The potential is huge. If we use this potential wisely, we can become one of the world's top five producers of biofuels," Beisen Donenov, executive director of the Kazakhstan Biofuels Association, said on the sidelines of a grains forum. Reuters - November 30, 2007.

    SRI Consulting released a report on chemicals from biomass. The analysis highlights six major contributing sources of green and renewable chemicals: increasing production of biofuels will yield increasing amounts of biofuels by-products; partial decomposition of certain biomass fractions can yield organic chemicals or feedstocks for the manufacture of various chemicals; forestry has been and will continue to be a source of pine chemicals; evolving fermentation technology and new substrates will also produce an increasing number of chemicals. Chemical Online - November 27, 2007.

    German industrial conglomerate MAN AG plans to expand into renewable energies such as biofuels and solar power. Chief Executive Hakan Samuelsson said services unit Ferrostaal would lead the expansion. Reuters - November 24, 2007.

    Analysts think Vancouver-based Ballard Power Systems, which pumped hundreds of millions and decades of research into developing hydrogen fuel cells for cars, is going to sell its automotive division. Experts describe the development as "the death of the hydrogen highway". The problems with H2 fuel cell cars are manifold: hydrogen is a mere energy carrier and its production requires a primary energy input; production is expensive, as would be storage and distribution; finally, scaling fuel cells and storage tanks down to fit in cars remains a huge challenge. Meanwhile, critics have said that the primary energy for hydrogen can better be used for electricity and electric vehicles. On a well-to-wheel basis, the cleanest and most efficient way to produce hydrogen is via biomass, so the news is a set-back for the biohydrogen community. But then again, biomass can be used more efficiently as electricity for battery cars. Canada.com - November 21, 2007.

    South Korea plans to invest 20 billion won (€14.8/$21.8 million) by 2010 on securing technologies to develop synthetic fuels from biomass, coal and natural gas, as well as biobutanol. 29 private companies, research institutes and universities will join this first stage of the "next-generation clean energy development project" led by South Korea's Ministry of Commerce, Industry and Energy. Korea Times - November 19, 2007.

    OPEC leaders began a summit today with Venezuelan President Hugo Chavez issuing a chilling warning that crude prices could double to US$200 from their already-record level if the United States attacked Iran or Venezuela. He urged assembled leaders from the OPEC, meeting for only the third time in the cartel's 47-year history, to club together for geopolitical reasons. But the cartel is split between an 'anti-US' block including Venezuela, Iran, and soon to return ex-member Ecuador, and a 'neutral' group comprising most Gulf States. France24 - November 17, 2007.

    The article "Biofuels: What a Biopact between North and South could achieve" published in the scientific journal Energy Policy (Volume 35, Issue 7, 1 July 2007, Pages 3550-3570) ranks number 1 in the 'Top 25 hottest articles'. The article was written by professor John A. Mathews, Macquarie University (Sydney, Autralia), and presents a case for a win-win bioenergy relationship between the industrialised and the developing world. Mathews holds the Chair of Strategic Management at the university, and is a leading expert in the analysis of the evolution and emergence of disruptive technologies and their global strategic management. ScienceDirect - November 16, 2007.

    Timber products company China Grand Forestry Resources Group announced that it would acquire Yunnan Shenyu New Energy, a biofuels research group, for €560/$822 million. Yunnan Shenyu New Energy has developed an entire industrial biofuel production chain, from a fully active energy crop seedling nursery to a biorefinery. Cleantech - November 16, 2007.

    Northern European countries launch the Nordic Bioenergy Project - "Opportunities and consequences of an expanding bio energy market in the Nordic countries" - with the aim to help coordinate bioenergy activities in the Nordic countries and improve the visibility of existing and future Nordic solutions in the complex field of bioenergy, energy security, competing uses of resources and land, regional development and environmental impacts. A wealth of data, analyses and cases will be presented on a new website - Nordic Energy - along with announcements of workshops during the duration of project. Nordic Energy - November 14, 2007.

    Global Partners has announced that it is planning to increase its refined products and biofuels storage capacity in Providence, Rhode Island by 474,000 barrels. The partnership has entered into agreements with New England Petroleum Terminal, at a deepwater marine terminal located at the Port of Providence. PRInside - November 14, 2007.

    The Intergovernmental Panel on Climate Change (IPCC) kicks off the meeting in Valencia, Spain, which will result in the production of the Synthesis Report on climate change. The report will summarize the core findings of the three volumes published earlier by the separate working groups. IPCC - November 12, 2007.

    Biopact's Laurens Rademakers is interviewed by Mongabay on the risks of large-scale bioenergy with carbon storage (BECS) proposals. Even though Biopact remains positive about BECS, because it offers one of the few safe systems to mitigate climate change in a drastic way, care must be take to avoid negative impacts on tropical forests. Mongabay - November 10, 2007.

    According to the latest annual ranking produced by The Scientist, Belgium is the world's best country for academic research, followed by the U.S. and Canada. Belgium's top position is especially relevant for plant, biology, biotechnology and bioenergy research, as these are amongst the science fields on which it scores best. The Scientist - November 8, 2007.

    Mascoma Corporation, a cellulosic ethanol company, today announced the acquisition of Celsys BioFuels, Inc. Celsys BioFuels was formed in 2006 to commercialize cellulosic ethanol production technology developed in the Laboratory of Renewable Resources Engineering at Purdue University. The Celsys technology is based on proprietary pretreatment processes for multiple biomass feedstocks, including corn fiber and distiller grains. The technology was developed by Dr. Michael Ladisch, an internationally known leader in the field of renewable fuels and cellulosic biofuels. He will be taking a two-year leave of absence from Purdue University to join Mascoma as the company’s Chief Technology Officer. Business Wire - November 7, 2007.

    Bemis Company, Inc. announced today that it will partner with Plantic Technologies Limited, an Australian company specializing in starch-based biopolymers, to develop and sell renewably resourced flexible films using patented Plantic technology. Bemis - November 7, 2007.

    Hungary's Kalocsa Hõerõmû Kft is to build a HUF 40 billion (€158.2 million) straw-fired biomass power plant with a maximum capacity of 49.9 megawatts near Kalocsa in southern Hungary. Portfolio Hungary - November 7, 2007.

    Canada's Gemini Corporation has received approval to proceed into the detailed engineering, fabrication and construction phases of a biogas cogeneration facility located in the Lethbridge, Alberta area, the first of its kind whereby biogas production is enhanced through the use of Thermal Hydrolysis technology, a high temperature, high pressure process for the safe destruction of SRM material from the beef industry. The technology enables a facility to redirect waste material, previously shipped to landfills, into a valuable feedstock for the generation of electricity and thermal energy. This eliminates the release of methane into the environment and the resultant solids are approved for use as a land amendment rather than re-entering the waste stream. In addition, it enhances the biogas production process by more than 25%. Market Wire - November 7, 2007.

    A new Agency to manage Britain's commitment to biofuels was established today by Transport Secretary Ruth Kelly. The Renewable Fuels Agency will be responsible for the day to day running of the Renewable Transport Fuels Obligation, coming into force in April next year. By 2010, the Obligation will mean that 5% of all the fuels sold in the UK should come from biofuels, which could save 2.6m to 3m tonnes of carbon dioxide a year. eGov Monitor - November 5, 2007.

    Prices for prompt loading South African coal cargoes reached a new record last week with a trade at $85.00 a tonne free-on-board (FOB) for a February cargo. Strong Indian demand and tight supply has pushed South African prices up to record levels from around $47.00 at the beginning of the year. European DES/CIF ARA coal prices have remained fairly stable over the past few days, having traded up to a record $130.00 a tonne DES ARA late last week. Fair value is probably just below $130.00 a tonne, traders said. At this price, some forms of biomass become directly competitive with coal. Reuters Africa - November 4, 2007.

    The government of India's Harayana state has decided to promote biomass power projects based on gasification in a move to help rural communities replace costly diesel and furnace oil. The news was announced during a meeting of the Haryana Renewable Energy Development Agency (HAREDA). Six pilot plants have demonstrated the efficiency and practicability of small-scale biomass gasification. Capital subsidies will now be made available to similar projects at the rate of Rs 2.5 lakh (€4400) per 100 KW for electrical applications and Rs 2 lakh (€3500) per 300 KW for thermal applications. New Kerala - November 1, 2007.


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Tuesday, December 04, 2007

IFPRI report: more free trade needed to tackle rising food prices; small farmers could benefit

Income growth, climate change, high energy prices, globalization, and urbanization are all converging to transform food production, markets, and consumption, according to a new report by the International Food Policy Research Institute (IFPRI). As a result, global food demand and prices are likely to rise, threatening the livelihoods and nutrition of poor people in developing countries. The report, The World Food Situation: New Driving Forces and Required Actions [*.pdf], was released today at the annual general meeting of the Consultative Group on International Agricultural Research (CGIAR).

The IFPRI makes recommendations which it thinks can help overcome the effect of rising food prices to some extent. They include the removal of trade barriers, investments in critical rural infrastructures and more efforts in agricultural science.
Food prices have been steadily decreasing since the Green Revolution, but the days of falling food prices may be over. Surging demand for feed, food, and fuel have recently led to drastic price increases, which are not likely to fall in the foreseeable future, due to low stocks and slow-growing supplies of agricultural outputs. Climate change will also have a negative impact on food production, compounding the challenge of meeting global food demand, and potentially exacerbating hunger and malnutrition among the world's poorest people. - Joachim von Braun, lead author of the report and director general of IFPRI
Economic growth has helped to reduce hunger, particularly when it is equitable, says von Braun. But unfortunately, growth does not always reach the poorest people.

Consumer Demand
Many regions of the developing world, especially China and India, have seen high economic growth in recent years. Together with an expanding urban population, income growth is altering spending and consumer preferences. Global food demand is shifting from grains and other staple crops to processed food and high-value agricultural products, such as vegetables, fruits, meat, and dairy.

Importantly, the IFPRI says, the rising food prices offer opportunities for small farmers, even though it will not be easy for them to tap into the market:
Although many smallholder farmers would like to take advantage of new income-generating opportunities presented by high-value products, there are serious barriers to entering this market, including the capacity to address safety and quality standards and produce large quantities for food processors and retailers.
First generation biofuels
In response to rising oil costs, the production of first generation biofuels as an alternative source of energy is also contributing to dramatic changes in the world food situation. According to the report, increased production of biofuels made from food crops will adversely affect poor people in developing countries by increasing both the price and price volatility of food. Subsidies for such biofuels, which are common, exacerbate the negative impact on poor households, as they implicitly act as a tax on basic food.

Using computer modeling, IFPRI has projected the possible price effects of first generation biofuels for two potential scenarios up to the year 2020 (table, click to enlarge):
  • Under scenario one, which is based on the actual biofuel investment plans of many countries and the assumption that high-potential countries will expand their production of bioenergy, maize prices would increase by 26 percent and oilseed prices would rise by 18 percent.
  • Under scenario two, which assumes that the production of biofuels would expand greatly, to twice the level of scenario one, maize prices would increase by 72 percent and oilseeds by 44 percent.
In both scenarios, rises in crop prices would lead to decreases in food availability and calorie consumption in all regions of the world, with Sub-Saharan Africa suffering the most. As biofuels become increasingly profitable, more land, water, and capital will be diverted to their production, and the world will face more trade-offs between food and fuel.

Agricultural Trade
In addition to biofuels, IFPRI also modeled the impact of supply and demand changes on prices and projects that up to 2015, cereal prices could further increase by 10 to 20 percent, benefiting certain countries and population groups while ill-affecting others. China and almost all African countries, which are net importers of cereals, would suffer from the resulting high prices, but India, a net exporter would benefit. Overall, the majority of poor people, who live in households that are net buyers of food, will be worse off and increased food prices will make it even more difficult for them to eat healthy, well-balanced diets.
A more open global trade in agriculture, however, would generally benefit developing countries. IFPRI research shows that opening up and facilitating market access between industrialized and developing countries would bring significant economic gains, although poverty would not be significantly reduced except in certain contexts.
Climate Change
World agricultural output is projected to decrease significantly due to global warming, and the impact on developing countries will be much more severe than on industrialized nations. Africa is particularly vulnerable to climate change because of its high proportion of low-input, rainfed agriculture, compared with Asia or Latin America. Exposure to rainfall variability also extends to livestock, which mostly depend on range and grasslands that are affected by environmental shocks, such as climate change. To address these risks, investments to improve agricultural productivity need to increase and innovative insurance mechanisms should be explored to compensate rural communities and smallholder farmers when rains fail.

Policy Recommendations
Given the various risks and challenges posed by the rapidly changing world food situation, current market trends and government policies could exacerbate hunger and poverty, especially for the world's poorest people. Policymakers thus must take explicit measures to mitigate the negatives effects on poor households. While tackling long-term challenges is vital, the report recommends that policymakers also take immediate action:
:: :: :: :: :: :: :: :: :: :: :: ::
  1. Developed countries should facilitate flexible responses to drastic changes in food prices by eliminating trade barriers and programs that set aside agriculture resources. A world facing increased food scarcity needs to trade more, not less.
  2. Developing countries should increase investment in rural infrastructure and market institutions to improve access to critical agricultural inputs, including fertilizers, seeds, and credit, which are key to enhancing productivity.
  3. To counteract rising food prices, national and international research systems, including the CGIAR, should be positioned to invest more heavily in agricultural science and technology to increase agricultural production on a global level.
  4. Policymakers should enact social protection measures that focus on early childhood nutrition to mitigate risks associated with reduced food access, particularly for the poorest households.
  5. Because poor people in developing countries are especially vulnerable to the risks associated with climate change, particularly as it relates to food security, policymakers should take agriculture and food issues into account when developing national and international climate change agendas.
As the world food situation is being rapidly defined by new driving forces, including income growth, climate change, and increased production of biofuels, the global community must give renewed attention to the role of agriculture, nutrition, and health in development policy. Above all, policies must target the world's most poor and hungry people, to ensure that they do not get left behind in the wake of overall economic growth and global progress. - von Braun
The Consultative Group on International Agricultural Research (CGIAR), established in 1971, is a strategic partnership of countries, international and regional organizations and private foundations supporting the work of 15 international agricultural research Centers. In collaboration with national agricultural research systems, civil society and the private sector, the CGIAR fosters sustainable agricultural growth through high-quality science aimed at benefiting the poor through stronger food security, better human nutrition and health, higher incomes and improved management of natural resources.

References:

The International Food Policy Research Institute (IFPRI) seeks sustainable solutions for ending hunger and poverty. IFPRI is one of 15 centers supported by the CGIAR.

IFPRI: Joachim von Braun, The World Food Situation: New Driving Forces and Required Actions [*.pdf] - December, 2007.

IFPRI: Fact sheet [*.pdf]- December 4, 2007.

IFPRI: Rising food prices threaten world's poor people - December 4, 2007.

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