Julia Irwin (Fowler, Australian Labor Party) Share this | Hansard source

quite obviously they do not like this speech, because it is the truth—is to plant biofuel crops such as palm oil and sugar cane. The demand for these crops is driven by policies in the United States and Europe which demand higher levels of biofuels, requiring as much as 10 per cent of the volume of fuels from so-called renewable sources. The effect of this is already clear from the diversion of corn crops in the United States. It is estimated that by next year one-third of the US corn crop will be used for the production of ethanol. An immediate effect of the European Union mandating biofuels, and the increase in crude oil prices, is the vastly increased demand for sugar cane and palm oil. The increased production of these crops is coming from the very slash-and-burn practices that the government says it wants to prevent.

Trying to achieve an outcome in the face of the policy driven demands for biofuels in the United States and Europe is just bad policy. Unless the leaders of developed nations rethink their doomed policies, we face a double disaster. We face the environmental consequences of tropical forest clearing on a scale far beyond anything we have seen so far. As well as that, we face an economic and social disaster resulting from massive increases in staple food prices. In the words of economist commentator Max Walsh:

The US sees corn-based ethanol as the answer to its oil and greenhouse problems. The resulting agriculture revision could well fuel global recession.

The government should consider those words when it implements its initiative. (Time expired)

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