The Myth in Food Costs and Ethanol

Food vs. Fuel – A Reversal by the World Bank

In a 180-degree turn from its previous position, the World Bank now says that spikes in grocery prices from 2007 to 2008 were not the fault of ethanol and other biofuels. The World Bank's new report concludes exactly what Growth Energy has been saying for the last two years: the food-versus-fuel debate is myth.

While the newest report is a complete about-face from the 2008 Policy Research Working Paper, we at Growth Energy are wondering when the World Bank executives will actually admit that they were wrong two years ago when they claimed that ethanol's use of grain was pushing up grocery prices. The newest report correctly points out that, in fact, it is the price of oil and other fossil fuels, as well as rampant market speculation, that played the most significant role in increasing food prices – not ethanol.

Unfortunately, ethanol's critics have used the now-debunked World Bank study from 2008 to perpetuate the food-versus-fuel myth. Big Food and Big Oil have continuously cited the 2008 study more than any other to support their position on food-versus-fuel. In fact, this complete reversal by the World Bank confirms that food-versus-fuel has always been and will always be nothing more than a myth.

We are hopeful that this report will encourage others who have relentlessly perpetuated this untruth to admit their mistakes and put an end to this false debate.

http://www.renewableenergyworld.com/rea/blog/post/2010/08/food-vs-fuel-a-reversal-by-the-world-bank?cmpid=WNL-Tuesday-August3-2010

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