16/06/2011 (Business Day) - The ongoing debate on the possible impact the drive for biofuel will  have on food security should be of enthusiastic interest to us in Nigeria. This is so because currently, we are faced with the task of ensuring that we are food secured. Production of biofuel will eat deep into Nigeria's present stock of food crops such as grains, vegetable oil, sugarcane, cassava and so on.

Biofuels are organic primary or secondary fuels derived from biomass which can be used for the generation of thermal energy by combustion or by using other technology. They consist of purpose-grown energy crops, as well as multipurpose plantations and by-products. Two main types of liquid biofuels produced from purpose-grown, land-based energy crops are bioethanol and biodiesel. Bioethanol is an alcohol derived from sugar or starch crops (e.g. sugar beet, sugar cane or corn) by fermentation. Cellulosic materials (e.g. wood, grasses and some waste crop residues) can also be converted into bioethanol via a more complicated process but currently only at laboratory scale.

Biodiesel, on the other hand, is derived from vegetable oils (e.g. rapeseed oil, jatropha, soy or palm oil) by reaction of the oil with methanol. Waste residues (e.g. waste cooking fat) can also be converted into biodiesel. Biodiesel can either be burnt directly in diesel engines or blended with diesel derived from fossil fuels.

Industry stakeholders have made snooty claims about the role of biofuels in development and poverty reduction. Some have argued that energy crops are beginning a green revolution in Brazil. Others have suggested that a bioproduct-based agro-revolution can offer a new development paradigm for the developing world. Some say biofuels can provide a solution to the twin problems of poverty and climate change. And some claim that in fuel importing developing countries, biofuels can enable rural job creation and food security; reduce oil imports and generate savings on foreign exchange; demonstrate tropical comparative advantage in production; improve domestic and regional energy production capacity; and enable economic diversification.  But it is negative watch and comment in some quarters.

What does biofuel mean for Nigeria's food security? Results from a new study published by Oxfam suggest that prices of staple crops such as maize could rise by 180 percent by 2030.  The study predicts that the average price of staple foods will more than double in the next 20 years, leading to an unprecedented reversal in human development. According to the National Bureau of Statistics (NBS), Nigeria spends about N300 billion on food imports alone (food, beverages and processed combined).

The implication of such unprecedented price increase is that Nigeria's poorest people, who spend up to 80 percent of their income on food, will be hit hardest. The same publication concludes that the world is entering an era of permanent food crisis which is likely to be accompanied by political unrest and will require radical reform of the international food system.  We can transform this challenge into opportunity.

Those claims by pro-biofuel advocates about the role of biofuels in development and poverty reduction may not work for our smallholder farmers who dominate the Nigerian farming population. This is so because they would be displaced by emergency commercial farmers who do same when it comes to accessing agriculture loans. Biofuel raw material supply chain requires big operators.

If we must endorse biofuel, we must be careful it is not done at the expense of food security. We need to learn from China's experience. China's biofuel industry is booming. It modernised versions of ancient chemical processes to convert crops and oils into energy sources. Chinese entrepreneurs have created a profitable 'green business' with a copious room for growth. 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.