Globalization of the fuel vs. fuel debate
Last Thursday, Canada’s Prime Minister, Stephen Harper, announced substantial subsidies to boost Canada’s production of biofuels. Under its “ecoENERGY for Biofuels” program, the government will provide up to C$ 1.5 billion (US$ 1.4 billion) in the form of incentives over nine years to producers of renewable alternatives to gasoline and diesel fuel.
“With leading-edge technology and abundant supplies of grains, oilseeds, and other feedstocks, Canada is uniquely positioned to become a global leader in the production of biofuels,” said the prime minister.
Today, the BBC ran a story explaining that, in part thanks to the increasing diversion of Canadian durum wheat into biofuels, supplies of this very special grain are getting tight. The result: the price of pasta, one of Italy’s staple foods, is forecast to go up by about 20 percent this autumn.
The BBC explains:
Italian pasta tastes good because it is made from durum wheat, of which Italy is one of the world’s main producers. But with strong demand at home and a growing export market, Italians are increasingly forced to import high quality durum wheat from abroad.
Much comes from Canada and Syria but, according to Mario Rummo, president of the Italian pasta manufacturers association, the Canadians have said they have no more durum wheat for sale until November. Syria, meanwhile, has just banned the export of grain.
The result will be a price hike of 20% for spaghetti and fettuccine by the autumn for Italians who have long been accustomed to cheap pasta in their supermarkets.
Canadian production of durum wheat has soared in recent years, but it is increasingly being sold as a bio-fuel to make ethanol which is why the wholesale price is going up.