Growing demand for biodiesel is pushing up food prices internationally.
A global switch from growing crops for food to growing them for biofuel production is boosting international prices paid for food, says a United Nations assessment of international farming trends.
"The switch to growing fuel crops will take land out of food production and increase the price of
commodities," said the report, jointly prepared by the Food and Agriculture Organisation and the OECD.
The step-change in international agriculture will increase the costs of livestock farmers in countries which rely on feeds such as maize or barley, but will also be profitable for farmers in food exporting countries, - such as New Zealand - it said in the annual assessment of farming trends, OECD-FAO Agricultural Outlook 2007-2016.
The paper ranks New Zealand at ninth in the world's leading "agro-food exporting countries" directly earning $US8.8 billion ($NZ11.4 billion) from a 2.43 percent share in world agriculture-based food trade.
It said that 20 years ago NZ ranked seventh, earning $US4.4 billion with a share of 2.92 percent, but had since been overtaken by both Argentina and Mexico.
The paper said higher food prices would also threaten the economies of food-importing countries as well as the urban poor.
Non-governmental groups have criticised the rush to energy crops as encouraging intensive, industrial agriculture at the expense of sustainable food production.
"The whole agrofuel process is going far too fast, pushed by corporations and governments before any controls are in place," Oscar Reyes of the Transnational Institute told the Guardian newspaper in Britain.
" Massive investment in infrastructure is already taking place that will set us on a path from which it will be difficult to escape," said Mr Reyes.
- NZPA
