Europe's targets to encourage greater use of biofuels will not make much difference to retail food prices, the EU's farm chief said today.
In January, the European Commission unveiled new targets for including a minimum 10 per cent biofuels within vehicle fuels by 2020.
To meet the targets, the EU biodiesel industry says it will have to raise output by 15 per cent each year and rely mostly on EU-grown rapeseed and sunflower seed oils up to 2020. Only 20 per cent of the raw materials would come from imports, it says.
Speaking today, EU Agriculture Commissioner Mariann Fischer Boel said the target would make EU prices for agricultural raw materials rise by between 3 and 6 per cent for cereals, and between 5 and 18 per cent for the major oilseeds.
Since prices for those raw products only influenced food prices to a limited extent, bread prices might increase by less than 1 per
cent because the cost of cereals comprised less than 5 per cent the consumer price of bread, she said.
"With regard to oilseed-based products, the increase in vegetable oil prices would be greater," Ms Fischer Boel said. "However, food manufacturers using vegetable oils can partly replace rapeseed oil with soyabean or sunflower oil."
Biofuels can be substituted for fossil fuels and are seen as a way to cut emissions of greenhouse gases believed to contribute to global warming. Feedstocks used to make biofuels include grain and vegetable oils as well as sugar beet and cane.