Germany is ready to give up biofuels to avoid world hunger

Russia’s war against Ukraine has exacerbated the global food crisis amid a coronavirus pandemic and drought. So far, world food prices have risen by almost 30% to record levels. This was stated in an interview with Bild by the Minister of Economic Cooperation and Development of Germany Svenya Schulze.

She believes that humanity is facing the worst famine since World War II, as 300 million people are already suffering from it, and the number of victims will continue to grow. It therefore calls for an end to food production (including palm oil, rapeseed, corn or wheat) not only in Germany but also around the world. Almost 4.4% of fuel is produced from food. Germany uses 2.7 billion liters of vegetable oil annually, which is almost half of Ukraine’s sunflower oil production.

Countries such as Germany, the United States and Brazil direct large amounts of grain and oilseeds to biofuel production, and allocate large subsidies from the budget. Rising prices for oil and petroleum products increase the need for biofuels, but the active development of electric vehicles in the near future will call into question the feasibility of increasing biofuel production.

August rapeseed futures on the European MATIF yesterday rose by 4.5 € / t to 846.5 € / t or 894.17 $ / t, adding 4% over the week amid rising oil prices.

November canola futures on the Chicago Stock Exchange fell 0.7% to 1074 CAD / t or $ 826.15 / t, adding 0.8% for the week.

The EU’s biofuels program has significantly supported rapeseed prices in Ukraine over the past 15 years, so the EU’s rejection of biofuels will reduce demand for domestic rapeseed. Already this year, due to the blocking of ports and difficulties with exports across the western borders of Ukraine, European processors will not receive part of the Ukrainian rapeseed, which will accelerate the reorientation of biofuel plants.

Tags: Germany, Biofuels