Click to play videoMumbai: Soaring crude oil prices have forced developed nations in Europe and the United States to look for environment-friendly alternatives.
Ironically, the consequence of finding cheaper and greener options like bio fuels has had a damaging impact on global food supply, culminating in higher food prices.
According to a World Bank report, as quoted by news agencies, the drive for bio fuels in the United States and Europe has forced a spurt of 75 per cent in commodity prices.
The report claims that without the increase in bio fuels, global wheat and maize stocks would not have declined substantially and therefore the hike in price due to other factors would have been moderate.
The report also says that in the past three years, essential food commodities like wheat and corn have seen prices rocket by 181 and 300 per cent in the world markets.
Developed countries like the United States and Europe are turning to bio fuels to reduce their dependence on oil imports. However, bio fuels compete for land with food crop, leading to distortions in the food commodity markets.
These distortions are being fuelled by the fact that the United States plans to use one-third of its corn production to produce ethanol, and the European Union is looking at about 50 per cent of its vegetable oils going towards products of bio diesel.
The World Bank in its report says that farmers have been asked to set aside land solely for bio fuel production, which is also another reason for financial speculation in grains and spiralling prices.
According to World Bank estimates, over one hundred million people across the globe have already been pushed below the poverty line, as a result of unaffordable food prices.
With its revelations, the World Bank report and the issue of food security will be an important agenda for debate at the G-8 summit.
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