China: Biofuels Eating into Food Grain Stocks

Here’s another example of the growing issue that is the grains-as-food-or-fuel debate:

But worried over surging crop prices China is now clamping down on the use of corn and other edible grains for producing biofuel. While it wants to support the growth of alternative energy sources, Beijing says the issue of national food security should take precedence over the country’s green agenda.

For all of the good press China receives for being an economic powerhouse, they do have their fair share of problems, including growing difficulty in feeding the 1 billion-plus souls that inhabit it. There is already a good deal of internal turmoil in the country caused by several factors, including the growing divide between the rich cities and poor countryside, ethnic tensions in the Muslim regions of China, and growing dissatisfaction with the government’s hammerlock on human rights and political power. Food riots don’t need to be added to that mix.

It will be curious to see if China seeks to still be an important player in the biofuel market, or if they will simply use their US Dollars to purchase whatever gas and oil they need to keep their export machine humming along smoothly.

Stay tuned…