UK shipping leader says mixed signals from UK on biofuels will cause transport shortage

In England, the CEO of maritime organization Lloyd’s Register said that mixed messages from the British government are leading to a shortage of fleet to carry biofuels. Richard Sadler said that comments by the prime minister and energy minister that biofuels mandates may or may not be scrapped are creating too much uncertainty for ship construction financing. An additional 400 ships are needed to transport the biofuels that would be required under European mandates of 10 percent biofuel content by 2020.

UK prime minister Gordon Brown signaled a pullback this week on biofuels, saying it no longer fully supported the 10 percent European biofuel target because of the world food crisis. Food prices have recently risen an average of $1500 per household. Britain, which has seen a strong currency surge which has dampened the impact of rising prices on imported foods, is highly dependent on imports for its food supply. He announced a review that would be completed by June on the overall impact of biofuel.

A panel convened by the prime minister said that: “We will review our approach to biofuels. We need to look closely at the impact on food prices and the environment of different production methods and to ensure we are more selective in our support. If our UK review shows that we need to change our approach, we will also push for change in EU biofuels targets.”

The panel also pledged to seek G8 action on agricultural development, increased support for the World Food Program, research on increasing agricultural yields, and renewed emphasis on a WTO trade agreement that reduces agricultural subsidies and tariffs.

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