South Africa,
Bioethanol and GMOs: A Heady Mixture
By Mariam Mayet - African Centre
for Biosafety - May 2006
www.biosafetyafrica.net
“Producing GM crops for non-food
purposes, as a renewable source of alternative fuels, may also provide
the basis for a more rational and balanced consideration of the technology
and its potential benefit, away from the disproportionate hysteria,
which has so often accompanied the debate over GM foods.” Agriculture
Biotechnology Council (comprised of Bayer Cropscience, ABSF, Syngenta,
Monsanto) [1]
“Politicians clinging to their colonial
gestures are incapable of learning or reshaping themselves in the face
of the end of the oil era. They attempt to replace agriculture with
agribusiness and take a gamble on the globalised capitalism of the soya,
either as animal fodder or as biofuels. They not only ignore the impending
tragedy, but they also try to evade their responsibilities towards the
alleviation of global Climate Change…… “ Grupo de
Reflexion Rural [2]
TABLE OF CONTENTS
1. FOREWORD
2. INTRODUCTION
3. SOUTH AFRICA’S INFATUATION WITH BIOETHANOL
4. GENERAL CONCERNS WITH BIOETHANOL AS A RENEWABLE
ENERGY SOURCE
5. SYNGENTA’S APPLICATION & BIOSAFETY
CONCERNS
6. CONCLUSION
FOREWORD
On the 12th May, Syngenta South Africa (Pty)
Ltd, a subsidiary of Swiss Agrochemical giant, Syngenta, notified the
South African public of its intention to seek commodity clearance for
its genetically modified (GM) maize, Event 3272, for use in the production
of ethanol. [3] This precedent setting application, the first GM application
for commercial approval in the world for a non-feed, non-food GM crop,
(using a food crop), has simultaneously also been launched in the US,
the EU and China.
The application by Syngenta illustrates its
expediency and desperation: Syngenta hopes to cash in on a potentially
lucrative burgeoning global bioethanol market, riding on the back of
escalating oil prices and supply fluctuations, while at the same time,
securing new markets for its GM products where there is little risk
of consumer rejection.
However, Syngenta’s application is
also mysterious, for 2 reasons. The application made to South Africa
is for clearance to expedite imports and not for growing. It is a guarded
secret as to where Syngenta hopes to grow the GM maize. South Africa
does not import GM maize from the US, for several reasons, including
the fact that the US has approved many more GM events (varieties) than
has South Africa and contamination by unapproved GMOs cannot be ruled
out or avoided. [4] In any case, the US will rely on its own domestic
market to sustain the demand for ethanol from maize in that country.
South Africa, does, however, import huge amounts of GM maize from Argentina.
Will Argentina become the factory farm or will it be another developing
country?
Second, the application seems to be superfluous
in the light that Diversa Corporation, well known to anti-biopiracy
activists, recently brought to the market, the same enzyme alpha-amylases,
used in Syngenta’s GM maize. The enzyme is derived from a deep-sea
micro-organism [5] and is meant to convert the starch present in maize
into sugars for processing into ethanol. This same rationale is being
given by Syngenta to the South African authorities as motivation to
grant approval for the GM maize! What makes it all the more curious
is that Syngenta owns substantial shares in Diversa.
INTRODUCTION
Interest in ethanol as a biofuel is not new.
It began during the oil crisis of the 1970s at that time when several
countries, led by the US, began to phase out lead from gasoline. In
1978, the US Congress approved the National Energy Act, which included
a Federal tax exemption on gasoline blended with 10% alcohol. Federal
subsidies also reduced the cost of ethanol to around the wholesale price
of gasoline. [6] Thus, in the US, ethanol relies heavily on subsidies
to remain economically viable as a gasoline- blending component. The
current Federal subsidy of 51-cents-a-gallon makes it possible for ethanol
to compete as a gasoline additive. The US also imposes a 54-cent-a-gallon
tariff on imported ethanol, thus promoting its domestic ethanol production.
However, gleaning from the literature, the
ethanol subsidy is due to expire in 2007/8, and it is not clear whether
ethanol will continue to receive political support.
In the US, ethanol is derived mainly from
maize and is blended in quantities up to 10% in gasoline (also called
E10 or low-blend). In terms of the Energy Bill passed called “EPAct
2005”, the volume of ethanol will be increased from the current
4 billion gallons/year to 7.5 billion. It is reported that a booming
ethanol industry will consume 20% of the 2006 US maize crop, cutting
the maize surplus in half by 2007, or 1.14 billion bushels. Some 54
million tonnes of the 2006 maize crop is projected to go to ethanol
plants, up 34% from 40.6 million tonnes). [7]
There are 97 ethanol plants in the US with
a capacity of 4.5 billion gallons (17 billion litres) a year. There
are 44 projects under way that will add 1.4 billion gallons of capacity
this year. By early 2007, the US it is expected to be producing at a
rate of 24.6 billion litres of ethanol, requiring 2.15 billion bushels
of maize. [8] This implies an increase in maize production in the US
to sustain the demand for maize. Currently, the US is the world’s
largest maize derived ethanol producer, accounting for 33% of the global
market. Brazil is the world leader in ethanol production, derived from
sugarcane, accounting for 37% of the global market. [9]
At the beginning of 2006, South Africa phased
out the use of lead, which created a boon to the ethanol industry, as
ethanol can be used as an additive to boost the octane number of unleaded
fuel. In addition, and following on from the lead of the US, at the
launch of the National Energy Regulator of South Africa in November
2005, Deputy President Phumzile Mlambo-Ngcuka said that the South African
Cabinet had approved a proposal by the Departments of Minerals and Energy
(DME), Agriculture and Land Affairs, and Science and Technology, to
explore biofuels as an important component of South Africa’s energy
mix.
Touted as a cleaner, greener fuel, by reducing
CO2 emissions by 60%, ethanol is said to bring huge socio-economic benefits
through especially job creation. According to Busi Nxumalo, South Africa’s
Energy Development Corporation’s (EDC) business and market analyst,
a strong local biofuels industry will also make a significant contribution
to South Africa’s GDP. According to him, if a 10% blended bioethanol
is achieved, it will add 0,25% to the country’s GDP. In addition,
a 10% blending ratio will enable South Africa to save R2.5-billion a
year in imports, which equates to a reduction of 1% in overall national
foreign expenditure. [10]
Industry lobby groups are feverishly pushing
the South African government to create the economic regulatory framework
to do two things: to make the blending of ethanol into petrol mandatory
for oil companies, and to allow a 30% reduction in the fuel levy to
be extended to bioethanol industry, as it currently does, the biodiesel
industry. Indeed, Ngubane has said very recently that the EDC was investigating
the viability of adding a 10% ethanol blend to petrol. [11]
South Africa’s Infatuation With Ethanol
“We believe it is going to be mandatory
to be used as a blend and even if there is no regulatory blending of
ethanol, we plan to export what we produce.” Johan Hoffman, Ethanol
Africa [12]
“We may by-pass the sugar industry
completely, develop new sugar case production to supply ethanol mills”
and… the Makhathini Flats near Jozini Dam can be turned into small-scale
sugar cane production, with numerous job-creation and economic benefits
for the region [13]
South Africa’s ethanol production is
currently controlled by Sasol, which produces (synthetic) industrial
alcohol from coal and gas, used to make ethyl acetate, high purity ethanol
and a small volume for fuel. South Africa also produces fermentation
ethanol, with Illovo Sugar producing molasses for feedstock. Indeed,
Illovo Sugar is the largest ethanol producer in South Africa from a
renewable source-sugar cane.
A recent study found that the bio-energy
potential of Sub-Saharan Africa-after accounting for food production
and resource constraints-was the greatest among all major world regions.
[14] The high potential results from the large areas of suitable cropland
in the region, large areas of pasture land that are not currently used
and the low productivity of existing agricultural production systems
as well as the low cost of labour. South Africa’s total land area
is 121.4 Mha, of which, 99.6 Mha or 82% is comprised of total share
of agricultural area, of which only 12.9 % is comprised of cultivated
area. [15]
Recently, the South African media unexpectedly
broke the story that South African company, Ethanol Africa, announced
plans to build a string of eight maize-to-ethanol plants in South Africa
at a total cost of $1 billion. Carbon credits company, Sterling Waterford,
is Ethanol Africa’s 50/50 partner. South Africa’s Energy
Development Corporation (EDC), a division of the state-owned Central
Energy fund, is to buy a 25.1% stake in Ethanol Africa. [16] The Industrial
Development Corporation (IDC) has also given the ambitious project its
blessing. [17] An undisclosed Black Economic Empowerment (BEE) partner
is also involved, as is Belgian biofuels company, Alco. [18]
Hundreds of South African maize growers had
taken up a minor stake in Ethanol Africa, through Grain Alcohol Investments.
These farmers have pledged thousands of tonnes of maize a year to pay
for their stake in the firm. [19] Each of the 8 plants is likely to
consume 370,000 tonnes of maize a year totalling 2.96 million tonnes
if all 8 plants were built, and producing 1.2 billion litres of ethanol.
[20]
Construction of the first plant, in Bothaville
the heart of the maize belt in the Free State province, is expected
to cost 700 million rand ($111.4 million), and is due to be completed
in late 2007. The plant will require a further 200 million rand to purchase
about 375,000 tonnes of maize yearly for processing into approximately
473, 000 litres of ethanol daily. Shareholders in the Bothaville plant
include Ecofields, a group of maize farmers are expected to sign contracts
on a yearly basis to supply the plant with an estimated 375 000 tons
of maize a year. [21]
Farmers’ organisation, Grain South
Africa is fully supportive of the ethanol scheme, because they see it
is a solution to the surplus maize produced, which is likely to be around
4.5 million tons surplus in 2006.
However, it is reported that the scheme has
yet to have a significant impact on the Johannesburg SAFEX maize prices.
Traders are reported to be more worried about short-term overproduction
and poor exports and are sceptical that farmers will agree to cooperate
on the project. [22]
Furthermore, large-scale production will
require a structured economic and regulatory framework. The CEF is suggesting
a 10% blending ratio with conventional petrol. Based on this proposal,
and taking into account that South Africa uses about 11-bilion litres
of petrol a year, the CEF is hoping that some 1, 1-billion litres of
bio-ethanol will be produced a year. [23]
However, according to the IDC, most ethanol
would, however, not come from maize but from sugar cane. The IDC expects
the bulk-about 50% -of the 1,1 billion litres of ethanol to be produced
from sugar cane, with 150 million litres coming from sugar beet and
the rest from maize and sweet sorghum. [24] At this point in time the
South African sugar industry appears to be still closed to the idea
of using sugar cane for ethanol production and discussions to this effect,
are speculative, at best. According to a recent report, the sugar industry
will not discuss ethanol as an industry, and is arguing that it needs
R2-a-litre subsidy to supply ethanol to the fuel market. [25]
However, the government is reported to have
said that they “may by-pass the sugar industry completely, develop
new sugar case production to supply ethanol mills” and in this
regard, the Makhathini Flats near Jozini Dam can be turned into small-scale
sugar cane production, with numerous job-creation and economic benefits
for the region. [26]
GENERAL
CONCERNS
Once maize is harvested, three energy expenditures
in ethanol production raise the total costs. These include energy to
the transport of maize grain to the ethanol plant, energy expended to
provide the capital equipment requirements for the plant, and energy
expanded in the plant operations for the fermentation and distillation
processes. The effective energy balance of ethanol as a biofuels is
therefore in doubt.
A study by Pimental and Patzek shows that
turning plants such as maize, soyabeans and sunflowers into fuel uses
more energy than the resulting ethanol or biodiesal generate. [27] The
researchers demonstrated that sunflower oil requires 118% more fossil
energy to refine it than the fuel obtained from it. Likewise, soya requires
27%, and maize 29% more fossil fuels than that obtained from the crops
themselves. [28] According to the researchers, it takes six units of
energy in corn farming, distillation, and transportation to yield one
unit of energy produced by ethanol in an automobile.
Ethanol for example can’t be transported
via pipeline-it has to be carried from distillation plants via truck
and railraod, which creates additional energy costs. Fuels blended with
ethanol cannot be shipped in multi-fuel pipelines, because the moisture
in pipelines and storage tanks is absorbed by ethanol, causing it to
separate from gasoline. Rather, the petroleum based gasoline components
have to be shipped separately and then blended with ethanol at a terminal
as the product is loaded onto trucks. [29]
Thus, bio-ethanol from maize has a much worse
energy balance and does not have environmental benefits.
Using maize for ethanol production is costly
in terms of land use, fossil energy, and most importantly it subverts
valued human food and animal feed from direct use. The fact that ethanol
production has a negative energy balance further precludes its place
as an alternative liquid fuel for the future.
It must also be borne in mind that maize
prices are the dominant cost factor in ethanol production, and ethanol
supply is extremely sensitive to maize prices. Ethanol production will
drop when maize is in short supply and prices are higher.
It is apparent that bioethanol production
for a fuel blend will require enormous government assistance and subsidies
to be viable for the bioethanol industry as a whole, subsidies that
can be more appropriately allocated to other pressing socio-economic
priorities for South Africa.
SYNGENTA’S
APPLICATION AND BIOSAFETY CONCERNS
Bioethanol, will provide a much-need outlet,
as has been the case with biodiesel, for the glut of genetically modified
crops that consumers are rejecting worldwide. [30]
The African Centre for Biosafety (ACB) has
received 2 appendices out of 19, in response to our application for
access to information in terms of the Promotion of Public Access to
Information Act, in keeping with the un-transparent regulation of GM
technology in South Africa.
According to Syngenta’s application
filed with the South African authorities, Event 3272 has been developed
to serve as a source of amalyse enzyme in the dry-grind fuel ethanol
process from maize, replacing the external addition of microbially produced
enzyme. The Event 3272 maize grain expresses an alpha-amylse enzyme,
which is to be mixed with conventional maize at the processing plant.
The application by Syngenta is not for commercial
cultivation in South Africa and according to the application, the GM
maize will be grown outside of South Africa and will be used locally
in the dry-grind fuel ethanol process. It is also not intended to be
used in other processing applications such as wet milling and dry milling
processes or to be exported as a commodity crop. However, according
to Syngenta, it cannot be excluded that the harvest originally intended
to be used in the dry-grind fuel ethanol industry could finally enter
international trade routes albeit at an extremely low level.
By-products of the dry-grind fuel ethanol
process produced from maize are used as feed (e.g. Distillers Dried
Grains and Solubles). By-products of the dry-grind fuel ethanol process
produced from Event 3272 will be co-mingled with by-products from conventional
maize could therefore enter the international food and feed trade routes.
According to the application, grain containing
Event 3272 could be imported in all the areas where non-genetically
modified maize is sold, e.g. the North West Province, the Free State,
Limpopo Province, Mpumlanga, Kwa-Zulu Natal and the Eastern/Western
Cape regions.
The ACB is still in the process of reviewing
Syngenta’s application with the objective of submitting biosafety
objections, particularly with regard to the potential allergenicity
of the novel enzyme, alpha-amylase. Nonetheless, we make the following
preliminary biosafety observations:
1. The ACB is concerned that the GM maize
variety will be pushed through the lax regulatory regime in South Africa
and present unacceptable risks to human health. Contamination of the
South African food supply by this GM maize cannot be excluded, as the
chances of contamination taking place are very high, along the entire
production chain in the secret country of export, in the course of international
trade and within the supply chain in South Africa itself;
2. The current application for commodity clearance for GM maize that
is not yet in commercial production and which has not yet been approved
in the country of export (since we do not even know where it will be
grown) is in contravention of the objectives, spirit and provisions
of the Cartagena Protocol on Biosafety (“Biosafety Protocol”),
which South Africa is a Party. The Biosafety Protocol requires that
the country of export first approve the GMO, before the Party of import
can grant any biosafety approval and indeed, that the GMO in question
must exist;
3. Genetic modification by the application of recombinant DNA technology
is characterised by scientific uncertainty. This stems from several
factors including the inherent imprecision of currently employed recombinant
DNA techniques, the use of powerful promoter sequences in genetic constructs
and the generation, as a result of genetic modification, of novel proteins/enzymes
to which humans and animals have never previously been exposed;
4. The genetic modification is not necessary because as already discussed,
the “built in” processing enzyme in Syngenta’s proposed
new GM maize variety for ethanol is already on the market as a stand-alone
product offered by Diversa; and
5. The novel enzyme is an unknown quantity and may present unacceptable
risks to human and animal health should it enter the food and feed supply.
CONCLUSION
Our work on biosafety in South Africa has
led us to this juncture: the interface between biosafety and energy.
We know some things about GMOs and biosafety and not much, about the
very deep discourse currently taking place in South Africa on climate
change, renewable energy, carbon trading and so forth. These issues,
we leave to those who are better qualified to deal with and will be
led in this regard by our fellow activists.
We offer this briefing paper in good faith,
and as a contribution to our joint struggles for social justice and
equity.
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Footnotes
1 Evidence Submitted to the United Kingdom’s
Environment, Food and Rural Affairs Select Committee Inquiry on Biofuels
by the Agricultural Biotechnology Council (abc).
2 Current Proposals To Manufacture Biodiesel From Soya Crops Threaten
Latin America With Catastrophe Buenos Aires, 28 April 2006 www.grr.org.ar
3 Such clearance would be given by the Executive Council, Genetically
Modified Organisms Act, and will therefore serve as a blank cheque,
for the international grain traders, to ship the GM maize into South
Africa in huge quantities.
4 Personal Communication, National Department of Agriculture, February
2006.
5 “It came from beneath the sea” Nature Biotechnology, Vol.
23, No.10, Oct. 2005, pp. 119-1201.
6 Joseph DiPardo Outlook for Biomass Ethanol Production and Demand,
Energy Information Administration.
7 Ethanol, Biodiesel eats into Corn Stockpiles, 15 May 2006 http://www.planetarket.com/dailynewstory.cfm/newsid/36348/story.htm
8 According to the United States Department of Agriculture’s chief
economist, Keith Collins. Ethanol, Biodiesel eats into Corn Stockpiles,
15 May 2006 http://www.planetarket.com/dailynewstory.cfm/newsid/36348/story.htm
9 Worldwatch: State of the World 2006, Chapter 4, Endnote 13.
10 South Africa Sows Crops-to-Energy Seeds, Engineering News 5 December
2005.
11 Energy body probes ethanol-mixed petrol, 17 May 2006 http://www.businessday.co.za/articles/economy
.aspx?ID=BD4A201198
12 South Africa Company to Build $1 Billion Ethanol Plants, 10 March
2006 http://www.planetark.com/dailynewsstory.cfm.newsid/35584/story.htm
13 Big Sugar, sweet life, 8 April 2006 http://www.mg.co.za/articlePage.aspx?articleid=268802&area=/insight_econ
unknown politician quoted. The Makhathini Flats has become synonymous
with Monsanto’s GM cotton hype, see, Elfrieda Schorn-Strauss Bt
Cotton in South Africa: the case of the Makhathini Farmers http://www.biosafetyafrica.net/_DOCS/SEED-05-04-3.pdf
14 Smeets et al, 204. A Quickscan of Global Bio-energy Potentials to
2050. An Analysis of the Regional Availability of Biomass Resources
for Export in Relation to Underlying Factors, Report WNS-W-2004-109,
ISBN 90-393-3909-0, March
15 Food and Agriculture Organisation Statistical Database (FAOSTAT),
2005, Food and Agriculture Statistical Database, http://foasta.foa.org
16 Ethanol Africa: Clean Maize Fuel, 12 September 2005 http://www.southafrica.info/ess_info/sa_glance/sustainable/ethanol-120905.htm
17 IDC eyes ethanol at $40 a barrel, 2 May 2006
http://www.mg.co.za/articlePage
.aspx?articleid=270550&area=/insight_econ
18 Ethanol Africa: Clean Maize Fuel, 12 September 2005 http://www.southafrica.info/ess_info/sa_glance/sustainable/ethanol-120905.htm
19 South Africa Company to Build $1 Billion Ethanol Plants, 10 March
2006 http://www.planetark.com/dailynewsstory.cfm.newsid/35584/story.htm
20 South Africa Maize Farmers See Ethanol Plant in 18 months, 15 March
2006 http://www.planetark.com/dailynewsstory.cfm/newsid/29938/story.htm
21 Free State to get first bio-ethanol plant, 24 February 2006 http://www.busrep.co.za/index.php?fArticleId=3128837
22 South Africa Maize Farmers See Ethanol Plant in 18 months, 15 March
2006 http://www.planetark.com/dailynewsstory.cfm/newsid/29938/story.htm
23 South Africa Sows Crops-to-Energy Seeds, Engineering News 5 December
2005.
24 http://www.mg.co.za/articlePage
.aspx?articleid=270550&area=/insight_econ
25 Big Sugar, sweet life, 8 April 2006 http://www.mg.co.za/articlePage.aspx?articleid=268802&area=/insight_econ…
26 Big Sugar, sweet life, 8 April 2006 http://www.mg.co.za/articlePage.aspx?articleid=268802&area=/insight_econ…
27 “Cornell ecologis’s study finds that producing ethanol
and biodiesel from corn and other crops isnot worth the energy”,
Cornell University News Service, 5 July 2005, http://www.news.cornell.edu/stories/July05/ethanol.toocostly.ssl.html
28 “Cornell ecologist’s study finds that producing ethanol
and biodiesel form corn and other crops is not worth the energy”
Cornell University News Service July 5, 2005 http://www.news.cornell.edu/stories/July05/ethanol.toocostly.ssl.html
29 Carlo Stagnaro Biofeuls Delusions The Saga Of The Costly Fuels That
Do Not Benefit the Environment IBL Focus N. 18-22 February 2006
30 Elizabeth Bravo and Mae-Wan Ho, The New Biofuel Republics, ISIS Press
Release 7 March 2006, http://I-isis.org.uk.NBR.php
Author : Mariam
Mayet - African Centre for Biosafety