Setting the Record Straight: Guatemala & NYT

Posted 10 January 2013 in

National

Yesterday, Tom Philpott at Mother Jones blogged about a recent piece in the New York Times that seeks to blame US renewable fuel policy for hunger issues in Guatemala, recycling a number of the same misleading claims we’ve heard from Big Oil and Big Food time and time again.

The Renewable Fuel Association has already put together a great takedown of the New York Times article, but we’d like to take this opportunity to make sure four key points come through in this debate:

1. There are several types of corn, and the type most commonly used to make ethanol is No. 2 yellow corn (the same type of corn used by the meat industry to feed cows, chickens, etc. in factory farms). Meanwhile, the corn used to make tortillas is white corn. Yellow and white corn are two very different products with different markets, price drivers and end users. In a way, the foundation of the article is based on comparing apples to oranges.

2. The New York Times article relies on an outdated yet oft-used statistic that says 40% of America’s corn goes to ethanol production. That stat excludes the 1/3 of field corn harvested that returns to the food system in the form of DDGS or dried-distillers grain solubles, a nutritious alternative to straight corn feed. The 40% number has been propagated by the grocery manufacturers and meat industry to prop up their claim that renewable fuel policies are increasing their cost of doing business.

3. As for what corn is grown in Guatemala – the issue here lies more in international trade, food aid and national policies rather than ethanol. Subsidies, tariffs, market prices, land prices, etc. all play important roles in agriculture and far outweigh the influence of US biofuels in this instance. The New York Times rightly pointed out that subsidized corn flowed south in the 90s. From an international development perspective, this is a poor outcome given the impacts on local farmers. However, the biofuels policy did not start to take effect until 2005. In the meantime, USDA data shows that the percentage of Guatemalan maize consumption comprised by imports has been steady since 2000 (even as total consumption increased 3% from 2004 to 2009). In fact, imports have fallen in the past year.

4. Why have imports fallen? Probably because Guatemala is a member of CAFTA and places a 10% tariff rate on corn and other grains, dissuading imports. And it’s helped encourage local corn farmers. According to the USDA, Guatemalans harvested 850,000 hectares of corn in 2012, the 2nd highest level in history. Over the past five years (remember, CAFTA was enacted in 2004… 8 years ago), harvested corn acres have been 32% higher on average than in the preceding 10 years.

The hunger problems that are plaguing developing nations all over the world are far more closely tied to macro- and micro-economic trends, commodities markets, international trade agreements, governmental and NGO aid packages, and even the price of oil than they are to a single U.S. industry or crop. We can only hope that in the future media outlets like the New York Times and Mother Jones will consider these important facts before rushing to smear the industries and policies that are helping the United States reduce its dependence on foreign fossil fuels.

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Setting the Record Straight: Guatemala & NYT