Environment Forum

Food for thought

Feeling hungry? Maybe that’s because of all the news, from around the world, about food today — how much people produce, how much more they need, how much it’s going to cost, how much of an effect it will have on climate change, and vice versa.

Starting in Washington, the U.S. Agriculture Department reported that American stockpiles of corn and soybeans will shrink to surprisingly low levels this year, which sent grain prices soaring to 30-month highs. Bad weather in places like Australia and rising world demand led by China are partly responsible for cutting crop inventories around the globe.

There’s actually encouraging news on the food front from south Sudan, where citizens are voting now to become an independent nation. While much of Africa is under intense pressure to provide food for its people, the U.N. World Food Programme says south Sudan could become a food exporter and end its chronic food dependency within a decade. But immediately after the vote, this area is likely to need more food aid, according to the U.N.

In India, food inflation rose for the fifth straight week to the highest level in more than a year, part of a trend of rising food prices across Asia. In India’s case, the price of staples like onions and tomatoes have political heft and are a major voter issue in advance of state elections there.

Back in the United States, two reports offer food for thought, or at least some interesting thoughts on food. The Worldwatch Institute, which puts together an annual “state of the world” report, focuses this year on agricultural innovation as the key to cutting poverty and stabilizing the climate. Looking at sub-Saharan Africa, where 239 million of the world’s 925 million hungry people live, Worldwatch advocates building up soil and water (not just donating seeds for planting), using existing food more effectively, and thinking about the global climate impact of growing food. “African farmers could remove 50 billion tons of carbon dioxide from the atmosphere over the next 50 years, primarily by planting trees among crops and stewarding nearby forests,” the report says, warding off “disastrous climate change.”

Environmental analyst Lester Brown worries that this change is already imminent. Talking to reporters about his new book, “World on the Edge,” Brown talked of a potential “food bubble” caused by over-use of natural water supplies and an over-plowing of soil. “When the food bubble bursts, we will see rises in food prices,” Brown said in a telephone briefing. “No one knows how much they will rise and exactly when a big jump will come.”

Still hungry? Perhaps for some fish? The U.S. National Oceanic and Atmospheric Administration told Congress today that six nations — Colombia, Ecuador, Italy, Panama, Portugal and Venezuela — have fishing vessels that engaged in illegal, unreported and unregulated fishing in the last two years.

Will biofuel from algae look like Big Oil or Big Agriculture?

Hundreds of companies and laboratories are racing to find an economical way to make “green crude” from algae. The biofuel industry is grappling with a series of hurdles, which players readily recognized at a summit this week in San Diego and we cover in this story.

One question asked by one of the sector’s early leaders is will biofuel from algae look like Big Oil or Big Agriculture.

Steve Mayfield, who directs a new center for algae biotechnology at the University of California, San Diego, believes it should be more like agriculture.

“We’re not going to grow it in the lab … We are going to grow it on rice patties,” Mayfield said at the Algae Biomass Summit in San Diego.

Mayfield also helped found Sapphire Energy, a privately held company that has pulled in $100 million from venture capitalists. The company is looking at gene-based techniques to create a strain of algae that can be grown and harvested on a massive scale.

“What we need to do is domesticate algae. We are taking wild type strains and asking them to do what never was asked to do or evolved to do in the wild,” Mayfield said, pointing to how genetic changes have boosted crop yields.

Photo credit: Reuters

Green Portfolio: Pacific Ethanol shines

Shares in the suffering utility Pacific Ethanol shot up over 8 percent on Tuesday, reaping the rewards of cheaper ethanol prices, thanks largely to what is expected to be a bumper crop year for U.S. corn. Units of Pacific Ethanol that owned four ethanol plants filed for Chapter 11 protection last month, stung by volatile prices for corn, low fuel demand and the credit crisis.******A senior company official at India’s Suzlon Energy said the wind power company was looking at selling assets and shares to lower its debt, dealing a major blow to its shares, falling 11.44 percent in Tuesday trading.

What a difference a year makes – Valero embraces corn ethanol

At last year’s American Petroleum Institute conference, Bill Klesse, CEO of leading U.S. oil refiner Valero, slammed federal policymakers who push subsidies and mandates for production of ethanol, saying that using corn to make it would make food so expensive it would cause more misery than global warming.

“All of these programs are just a huge transfer of wealth from our industry (oil) to the Midwest farms,” Klesse said in March 2008 speech.

A year later, Klesse has decided to join rather than fight. If the money is going to the Midwest corn farms, why not cash in, right? Valero two weeks ago was chosen by a bankruptcy court as the winning bidder for two more VeraSun ethanol-producing plants.  The sale of seven former VeraSun plants closed on Wednesday and two more are expected to close soon.

A year and two weeks ago, Klesse said the federal government should stop favoring ethanol with subsidies. Now, Klesse and Valero are securing a supply of ethanol that it needs to mix with its gasoline.

“We expect increases in the Renewable Fuels Standard to continue,” Klesse said two weeks ago when Valero’s bid for VeraSun’s plants was awarded.

The plants, in Iowa, Minnesota, South Dakota, Nebraska, and Indiana together will have a combined capacity that is 7.5 percent of the current operating U.S. ethanol capacity.

On Thursday, a Valero spokesman said the company needs to go full throttle on producing ethanol to mix with its gasoline. See the Reuters story.