THE indication this week from Ruth Kelly, the Transport Secretary, that there will be a major rethink on the initial target of a 5 per cent biofuel content in diesel by 2010 has been met with disbelief by the farming industry.
The government's view is that using crops such as oilseed rape and wheat as sources of fuel will drive up the cost of food.
NFU Scotland yesterday argued that increased food production and the development of a biofuels industry will be complementa
ry and provide considerable environmental benefits.
The debate, as NFUS admits, is "not black and white".
The scenario from the farming industry's point of view is that oilseed rape – the potential lead source for biofuels in Scotland – is crushed to provide cooking oil, the resultant meal is used as a feed for livestock, and waste oil can be a valuable energy provider.
Jim McLaren, president of NFUS, is a passionate believer in the need to integrate food and energy production.
He said: "Climate change poses enormous challenges and the involvement of farmers in the production of biofuels can play an important role in tackling future problems.
"Many farmers and processors have invested a great deal of time, money and environmental commitment into the production of biofuels and they must not be stopped in their tracks. The UK government has to continue to pursue renewable targets rather than hide behind biofuels as an excuse for higher food prices."
The rising cost of the weekly shopping basket is clearly a major political issue. However, only last July the government's Office for National Statistics pointed out that in real terms the cost of food was about 20 per cent cheaper than in 1987.
In the same week Tracey Richardson of the Meat and Livestock Commission forecast that over the subsequent 12 months consumers could expect an increase of 10 per cent in the cost of food. Spot on.
McLaren said yesterday: "The food versus fuel debate is far too simplistic. The UK farming industry is more than capable of producing quality food and contributing to the fight against climate change by producing biofuels. There is no need to make a stark choice between the two.
"We can see from the oilseed rape example that the cycle is far from simple and we need to think on a much wider front."
Oilseed rape values have virtually doubled over the past 18 months, but that is partly a result of a worldwide shortage of non-GM proteins. The European futures market for oilseed rape gave a clear pointer of that yesterday with the price for next month moving up by 3.75 to 449 (£355) per tonne.
McLaren added: "It seems we have governments in the UK and Europe lurching from one policy to the next, depending on the results of the latest opinion polls.
To tar all types of production with the same brush is ludicrous.
"We have real win-win renewable projects in Scotland.
"In Motherwell, for example, Argent is taking costly wastes such as tallow, mixing them with cooking oil and turning them into biodiesel. That's exactly the kind of work the government should be supporting."
Speaking exclusively to The Scotsman, Jim Walker, the managing director of Argent, said: "This is potentially a huge business and the latest from the UK government over food prices is nothing more than a knee-jerk reaction.
"This year we are on track to produce well over 50 million litres of biofuels, but the market is growing all the time. Not so long ago, when Alistair Darling was the minister for transport, he told me that we were the future.
"I agree with Jim McLaren in seeing no conflict in the UK between food and energy production. We can do both successfully."
