While bankrupt ethanol producers are making headlines in the U.S., another less visible trend trend is underway of rich nations snapping up land in Africa and Eastern Europe for future food and biofuel operations, according to a report on BusinessWeek.
An area roughly the same size as the amount of farmland in Germany is in play and at a cost of tens of billions of euros.
The source is a report International Food Policy Research Institute (IFPRI), an agricultural research center funded by governments. “These land acquisitions have the potential to inject much-needed investment into agriculture and rural areas in poor developing countries, but they also raise concerns about the impacts on poor local people, who risk losing access to and control over land on which they depend,” the report states.
Oil-rich Gulf nations and Asian countries, such as South Korea and China, are doing deals to secure land for food production. But European firms are in the game, as well. As the story on BusinessWeek.com states:
At the same time, exacerbating the problem is the scramble by mainly European firms for so-called idle or marginal lands on which to grow biofuels.
Stung by the criticism of scientists last year that using farmland for such crops can actually boost carbon emissions and increase food prices, biofuels firms have been scouting about for cheap ‘wasteland’.
All of which presents an interesting prospect — the export of food and fuels from regions that lack them most.
“If this was a negotiation between equals, it could be a good thing. It could bring investment, stable prices and predictability to the market,” said Duncan Green, Oxfam’s head of research. “But the problem is, [in] this scramble for soil I don’t see any place for the small farmers.”
June 12th, 2009 at 12:58 pm
[...] rush by investors into agricultural land is becoming a hot issue, as we’ve noted before. This week, for example, Fortune had a long piece about a hedge fund manager buying up farm land [...]