Paul Polman: Biofuel subsidy regime has spectacularly backfired

Polman, who recently pledged to halve the environmental footprint ​of his company’s products and source 100% of its agricultural raw materials sustainably in 10 years, said the stresses and strains on the global food system that led to food riots in 40 countries in 2008 had returned with a vengeance.

“In November the Food and Agriculture Organisation’s food price index reached a record high, while last week the US Department of Agriculture said that the ratio of global food stocks to demand had fallen to levels unseen since the mid ‘70s. ​

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“We are back in dangerous territory.”​

Biofuel debacle​

He also devoted several minutes of his speech at London's Guildhall to attacking “well-meaning”​ but ultimately ill-advised state interventions to subsidise first-generation biofuels, which diverted food crops into fuel production.

“There are still a number of areas where food security is actually jeopardised by sometimes well-meaning but ill-conceived state interventions.”​

He added: “There is nothing inherently wrong with biofuels, don’t misunderstand me, the second generation biofuels will have an important role to play in reducing emissions in the future, but the subsidies on first-generation biofuels, which use food crops such as corn, sugar or rapeseed as feedstocks, are distorting the market.”​

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Since 2003 the area of land under cultivation for biofuels had more than doubled to 25m hectares and more than 30% of the US maize crop and two thirds of the EU rapeseed crop was now devoted to biofuel production, he claimed.

Ill-conceived​

Moreover, many first generation biofuels actually had negative greenhouse gas balances, he observed. “The risk and rush to go faster with biofuels reduces further the land available for food production thereby exacerbating the threat to food security. ​

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“The biofuel policies of the EU and the US are ill-conceived... and governments on both sides of the Atlantic must apply far more rigorous sustainability schemes to all of these crops used for food production.​

“Otherwise we will find ourselves in the absurd situation of powering ourselves with energy sources that are not only more greenhouse gas intensive than their fossil fuel alternatives but also contribute to higher food prices for the poorer members of society, which is simply not acceptable.”​

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The following four key measures were critical to improving food security, proposed Polman:

• The widespread adoption of sustainable farming practices.
• A step-change in investment in agriculture.
• The elimination of market-distorting subsidies (see biofuels example above).
• Freeing up trade in food and agricultural products.

Polman, who also urged European consumers to be more “open-minded​” about genetic modification as one tool in the toolkit for increasing agricultural productivity without increasing its environmental impact, said the “resilience of the global food system was looking increasingly fragile”.​

Water shortages​

And water was one of the biggest worries, said Polman, who also outlined proposals to slash water use in agriculture, cut water use in the laundry, skin and hair washing process and significantly reduce water use in his firm’s manufacturing processes.

“I am becoming increasingly concerned about whether Greece and Spain will have adequate water in the coming decades to support our tomato harvests​.

“Companies like ours like stable environments and a continuous supply of raw materials and that is in jeopardy, so we have a responsibility to all of our stakeholders to do something about it.”​

Sustainable palm oil​

As part of its sustainability plan, Unilever will purchase all of its palm oil from certified sustainable sources by 2015; all of the paper and board for its packaging from certified sustainably managed forests or recycled material by 2020, all of its soy beans from sustainable sources by 2014 and all the tea in Lipton tea bags from Rainforest Alliance certified estates by 2015.

Packaging​

By 2020 it also aims to reduce the weight of its packaging by a third, provide consumers with more refills, increase recycling and recovery rates, develop new technology for recovering energy from sachet waste and eliminate PVC from packaging.