USDA Shows High Oil Prices, Other Factors Drive up Food Prices

Affirms Wisdom of U.S. Biofuels Policy

WASHINGTON, May 20 /PRNewswire/ -- The U.S. Department of Agriculture
released economic analysis that shows high energy prices, increasing global
demand, drought and other factors -- not biofuels -- are the primary drivers
of higher food costs. During a briefing on the case for food and fuel
yesterday, U.S. Agriculture Secretary Ed Schafer pointed to the fact that oil
prices have broken through a series of price ceilings this year.
"Developing diversity in our portfolio of fuels is if anything an even
more urgent matter than it has been in the past. And it is one that remains
central to our energy security and our national security," Schafer said. "The
policy choices we have made on biofuels will deliver long-term benefits."
Schafer pointed to International Energy Agency data that show global
biofuels production has cut consumption of crude oil by 1 million barrels a
day, offering savings of $120 million dollars a day.
The National Biodiesel Board praised the Secretary for speaking out on the
recent attacks on biofuels. "There has been a feeding frenzy on biofuels as
the reason for higher food prices, and those accusations are unfounded," said
Joe Jobe, CEO of the NBB. "It is encouraging to see USDA documenting some of
the real reasons for increased food prices. The American public is being
duped on this issue."
Last week, Sen. Charles Grassley (R-IA) released a plan by the Grocery
Manufacturers Association to discredit biofuels, calling their attempts to
blame biofuels for food price increases "outrageous and misplaced." He
blasted the plan as an "effort to undermine and denigrate the patriotic
achievement of America's farmers to reduce our dependence on foreign oil while
also providing safe and affordable food."
USDA has posted economic analysis and charts (http://www.usda.gov) that
document that "even with the current uptick in food price inflation, it is
much lower than it was in the 1970s and early 1980."
Schafer criticized efforts to repeal biofuels policy but urged the focus
to stay on long-term solutions. He pointed to the benefits of work to
increase global agricultural productivity, which is important to developing
countries food and energy needs. "The need for food and fuel is only going to
grow," Schafer said.
The NBB is the national trade association of the biodiesel industry and is
the coordinating body for biodiesel research and development in the U.S. Its
membership is comprised of biodiesel producers, state, national, and
international feedstock and feedstock processor organizations, fuel marketers
and distributors, and technology providers.
For more details on biodiesel, visit http://www.biodiesel.org.
SOURCE National Biodiesel Board

Amber Thurlo of Pearson, 1-800-841-5849, for National Biodiesel Board