Tue, 16 Aug 2022

BERLIN, Germany: To prevent large increases in food prices, officials from G7 countries, including Germany and the UK, will push for temporary waivers on biofuel mandates next week, according to Reuters.

A food versus biofuel debate has been ongoing due to the food crisis caused by the war in Ukraine, and in a bid to increase the supply of global grain and vegetable oil, some policymakers are calling for an easing of mandates for blending biofuels into petrol and diesel.

"We are quite keen to look at the issue of biofuel mandates to ensure that crops are prioritized for food consumption, and not necessarily for use in fuels," said a British government official, as reported by Reuters.

However, whether there is wide support for a temporarily biofuel mandate waiver among G7 members, which include Canada, France, Germany, Italy, Japan, the UK and the U.S., is unclear.

Surging oil and gas prices have also increased the demand for crop-sourced energy.

"The issue of biofuel mandates is at a preliminary stage of discussion at the working level," said a spokesman for Canada's agriculture ministry.

Next week, the group begin a three-day meeting in Germany, with food security expected to be on the agenda amidst the launch of a Global Alliance for Food Security in May aimed at eliminating hunger.

It is not clear whether Germany or Britain are considering waivers on biofuel mandates in their domestic market.

"These regulations really do need an off-ramp during times of high food prices," said Joe Glauber of the International Food Policy Research Institute, adding that while a waiver on biofuel mandates could help bring down food prices, it make fuel prices slightly higher in some countries, as quoted by Reuters.

He added that as corn-based ethanol is more competitive than biofuel produced elsewhere in the world, a waiver on biofuel mandates is not expected to have much impact on the U.S. industry, though it would have a greater impact on Europe.

Environmental groups and some governments have raised concerns over biofuels contributing to record rates of cropland expansion, including through deforestation, and questioning their environmental benefits. However, most governments have included biofuels in plans to reduce carbon emissions.

Biofuel producers and farmers are not expected to support a waiver on mandates.

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