Comment 59859

By mrjanitor (registered) | Posted February 16, 2011 at 13:08:44

This is what is really driving food price increases:

New rules fuel Biox growth plan

Full Disclosure: I worked at BIOX from 2005 to 2008 and we did not separate on the best of terms

Artificial incentives from the government to convert our food supply to our fuel supply are driving up prices at the supermarket checkout. BIOX's primary feedstock for it's process is the lowest grade of fat from rendering plants called Yellowgrease or the slightly higher grade of fat called Whitegrease. This is a good because Yellowgrease is not a foodgrade product, it is usually converted to industrial grade fatty acids and glycerols, therefor using it for fuel does not cause a rise in food prices. What concerns me is that Canada will run into the current practice like the USA where government mandates on alternative fuel content have driven up corn, canola and soybean prices to record levels. This is clearly implied in the article:

The new biodiesel and heating oil rules will especially help canola and soybean farmers, said Ritz, and will make Canada a leader in biofuel research.

Read here what ethanol mandates in the US has done to the corn market in 2007:

a new study has found that ethanol plants could use as much as half of America’s corn crop next year.

There is no natural free market for bio-fuels as of yet. I understand that there will be in the future and government incentives encourage the construction of the infrastructure required to support that future need before it is too late to do so. What we as consumers and taxpayers have to do is make sure that none of our food supply is diverted to achieve this. Biodiesel can be made from waste fats, algae or plants that grow in desert conditions. Ethanol can be made from sources other than corn.

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