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Should Canadian farmers cash in on biofuel boom?

A farm unloads his combine while his son drives the tractor alongside while harvesting corn. (AP / Seth Perlman)

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By: Nicole Tomlinson, Special to CTV.ca

Date: Sat. Jul. 28 2007 5:05 PM ET

When the ethanol market caused the price of corn tortillas to climb by 55 per cent last summer, tens of thousands of demonstrators protested in Mexico City.

A year later, Mexican farmers are burning their fields of blue agave, the main ingredient in tequila, to grow corn and feed North America's appetite for biofuels.

Canadians will likely have to pay more for tequila as less agave is planted. But before drowning your sorrows in a few shots of Cuervo Gold, cursing those who dare destroy its staple ingredient, you might want to reconsider where you're placing the blame.

Eric Holt-Giménez, who worked alongside farmers in Central America while completing his PhD, said their change of heart isn't all that hard to understand.

"If it makes money, farmers will grow it," the executive director of the Institute for Food and Development Policy said.

Corn is netting more than agave because the world is using ethanol as an alternative to fossil fuels -- and Mexico isn't the only Latin American country cashing in.

Plantations growing other biofuel crops like sugarcane, oil palm, and soy have already popped up in several countries in South America -- Holt-Giménez says the total land used for soybean cultivation in has increased by a factor of 57 since 1961.

For example, soybeans supply 40 per cent of Brazil's biodiesel -- and NASA observers have linked an increase in their market price with the destruction of the Amazon rainforest.

Brazil is also the largest producer of sugarcane in the world -- it makes 60 per cent of the globe's total sugar ethanol, and uses 13 per cent of its total herbicide load growing the crop.

"Brazil has a huge ethanol industry," Holt-Giménez said. "The environmental costs are tremendous, and the returns so paltry."

Holt-Giménez said Latin America is rushing to supply the U.S., which already imports over half the ethanol Brazil produces, because the U.S. government's biofuel targets exceed the country's agricultural capacity.

And studies show Canada is in the same boat as the U.S.

Research published by the federal government found Canada would have to use 36 per cent of its farmland to produce enough biofuels to replace just 10 per cent of the fuel currently used for transportation.

The publication also said 48 to 52 per cent of Canada's total corn-seeded area and 11 to 12 per cent of the wheat-seeded area would have to be used - all this for Canada to reach its domestic biofuel target of 5 per cent of the national fuel consumption by 2010.

Do the math

One hectare of sugarcane grown in Brazil produces almost twice as much ethanol as the same area of corn grown in Canada -- so should we be the next country to look south for our biofuels?

Kory Teneycke, the executive director of the Canadian Renewable Fuels Association, says North American fuel demand keeps rising -- and using some foreign biofuel may be a good way to help ease our energy shortage.

"Canada's traditional crude peaked in the 1980s ... we're short energies," Teneycke said.

"And in terms of whether we need to produce every litre of biofuel from a Canadian crop, or produce it all in Canada, I don't think we need to."

Teneycke says Latin American countries without oil reserves are getting an opportunity to tap into a market traditionally reserved for areas rich in fossil fuels.

"The beauty of biofuels is that you don't have to have won the geological petroleum lottery in order to produce them -- this produces a massive equalizer," Teneycke said.

He explained farmers, like the ones in Mexico trading in their blue agave for more lucrative corn, will have a better quality of life because they'll be making more money.

But Holt-Giménez says aggressive farming for biofuel production in Latin America only benefits big agri-business that's taking over countries such as Brazil and dispersing local farmers -- no matter what they're cultivating.

"It's not about local independence or the local economy ... It's good for grain companies, genetic engineering companies, and the automobile industry," Holt-Giménez said.

Studies have also shown ethanol produced in countries like Brazil actually contributes to climate change when the component crops are being grown on rainforest land.

A 2005 World Wildlife Fund study suggested that Brazil's biofuel program reduces transport emissions by 9 megatonnes a year -- but 80 per cent of the country's greenhouse gas emissions came from deforestation.

It also found a hectare of land in Brazil grows enough sugarcane to make ethanol and save 13 tonnes of carbon dioxide a year. But if natural forests were allowed to regenerate on the same land, the trees would absorb 20 tonnes every year.

Even though biofuels aren't a magic solution to global energy, environmental or agricultural problems, be prepared to see more expensive tequila, and more ethanol-dedicated fields, as people try to cash in on the market for a seemingly impossible dream.

"We're trying to consume our way out of over-consumption," Holt-Giménez said.

"We can't possibly produce enough corn -- but everybody's going to try."

Should more Canadian farmers ditch traditional crops to make biofuels?

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Michael
said
0 0

The same politics involved with the Global Warming debate is found in the biofuels controversy. We have a lot of land in Canada that can be used for biofuel development. Unfortunately we haven't rightfully concluded that Global Warming is only a natural cycle and not due to man made co2 emmissions. The global paradigm on energy is shifting and we need to be careful to consider correct scientific evidence not "Convenient Lies" based on political expediency and private agendas.


robert cochrane
said
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Entrepreneurial farmers in Canada have leapt on this bandwagon with declarations of what the source will be as far as they're concerned. Growing grains that will sell in either a biofuel or food market suits the fancy of the first off the block farmers and Conservatives appear to have bought into it.
Science on the other hand tells us that certain grasses are far more efficient than grains and actually do requre less fuel input to derive biofuel output. But logic and science don't win much in the battle for the minds of Conservatives.


Andrew
said
0 0

Every year in our Western provinces containers sit with rotting wheat inside. If converting to a biodiesel crop brings badly needed revenues and secures farmers futures then isn't it a no-brainer?


Robin Brown
said
0 0

Archers Daniels Midland (ADM) has a trillion dollar monopoly on our global food supply. Now along with the chemical companies, want to cash in on using food for fuel. How can we even consider using food for fuel when we still have millions of people starving in the world?
Biofuels are NOT the answer for anyone except big business. Is our conscience so clouded from pollution that we could live with ourselves in the west, and burn food in our vehicles and further deforest the planet? It is criminal how wasteful we are now.


Timothy Angerman
said
0 0

The short answer is no. As much as I am all for going green, studies have shown that the amount of fossil fuels used to produce the biofuels pretty much makes the whole idea a waste of time and just adds more to green house gases. However, if our biofuel crops were planted and picked by hand then it could be beneficial. Another aspect to look at is if the price of corn goes up, cattle farmers would be forced to put the price of beef up, which means we all pay more. Biofuel is not the answer and only a mere "feel good" measure to say we are doing something, because as a society we don't want to make the hard choices until we are forced to.


Gordon Reynolds
said
0 0

Canadian farmers have been going broke for years, trying to produce cheap food for the world. Why shouldn't they cash in on this new market?
I also believe that speculators drove the price of corn up as much or more than actual ethanol production which is still ramping up. This "new" industry will contribute to a shake up in the markets for awhile but there will be a correction. With or without biofuel production, ag products would have risen anyway, primarily due to the increasing cost of energy.


jack oschmann
said
0 0

Tortillas are not the most nourishing foods.
I do not drive a car and do not eat
tortillas.


stephen krywenko
said
0 0

Biofuel for the general population, will not work, it will only create higher food prices, and food shortages.. I believe biofuels should only be produced for food production, and for the producer's own use. If the grain producer require the 10% of his land needs to be converted to support his own farm (BIO Diesel ) then at least this will ensure that we have a cheap/plentiful food supply for the future..
people in cities can use other methods much easier- such as public transit,electric cars, and other methods.. if anything we should get the rail system back up and running at full capacity, we were a stupid country to have ripped it out, if any thing we should have converted it from diesel to electric such as in Europe.


Troy
said
0 0

Biofuels are wrong, and yes global warming is real. You commentors seem to think the jury is still out on this issue. It is not. Take your head out of the sand before you drown.

Continuing to deny is only going to harm your children and grandchildren and so on.

I imagine at some point in the future society will turn on those that held us back and brought on a catastrophe. I will relish that day.


Dennis
said
0 0

We have never been sitting on stocks of rotting grain, problem is getting a price for it... If we can get more for our grain we will take it, but longterm it is not the answer, we should look to solar, hydrogen and nuclear sources.


Harvey
said
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The only ones to cash in will be the Americans. They get all our fuel and then sell it back to us.


larry
said
0 0

We farm in Ontario and grow soy and corn etc. Prices are poor at this point. Although wheat prices are good for now.
Farmers already know about the issue of growing more biofuel crops, but prices are not good. The large price mentioned for corn in the article was brief, and only lasted long enough for the 'markets' to get more corn planted.
This has nothing to do with Conservatives or Liberals etc... it's the world market.


Ed Jonsen
said
0 0

I think that people should stop using cars and eliminate consumption of oil. Energy, like oil, gas and ethanol should only be use to heat houses. If necessary, consumption of oils and gases should be limited to emergency situations.


Jim Cripwell
said
0 0

The future of biofuels should not come from things that are basically food. We should be using the rest of the crop, e.g. corn stover, to produce ethanol. Iogen is showing the way. Why our government has not subsidized this aspect of biofuel production is quite beyond my comprehension.


Paul
said
0 0

While biofuel is a growing necessity and will greatly benefit the farmer I think that farmers should also focus on growing traditional crops. As more and more entrepreneurial farmers transition their resources to creating biofuel there is also a greater need to grow food. I'd rather see an allocation for each farmer as a percentage of the crop for both biofuel and traditional food resources.

The result is less dependency on MiddleEast Oil and substandard food products coming from China, India and the Asian countries. Food like fuel self-sufficiency is not something we should compromise.


D. Corbett
said
0 0

Mr. Cochrane, when it comes to what farmers grow, and barring government intervention in the form of subsidies or tariffs, liberalism, conservatism, socialism, or any other theory of political belief is largely irrelevant. The economics of what is profitable does. It is not a political issue. If it becomes profitable for farmers to convert their fields away from wheat stock to corn or other crops that can be converted to ethanol, such as switchgrass, they likely will. It's as simple as that.


Dennis
said
0 0

It is amazing that some people think that we should continue to go broke and leave the farm so they can enjoy some of the cheapest food prices in the world compared to wages.


Mitch
said
0 0

I don't believe biofuels are a long term answer, but since farmers are considering biofuels as an alternative crop they should be growing hemp.

There is plenty of evidence that hemp is amoung the densest of biomass crops, with a short growing season, little if any soil depletion and requiring no pesticides, making it a no-brainer especially for Canadian farmers. Industrial hemp (this is NOT marijuana) has been legal to grow in Canada since 1997 and many Canadian farmers are already growing it to produce nutritious foods and oils from the seed.

No solution is perfect but if farmers are considering a biofuel crop they should be researching industrial hemp.


 

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