(Bio)Fueling Injustice? - Europafrica

5.2.4. Making land a bankable investment
The EU biofuel policy also drives land grabbing in a more indirect but still pernicious
way by pulling up the value of the land and making it a bankable investment. It
has been pointed out in many reports that a significant part of land grabbing is due to
“land banking” – whereby investments in land are made not to produce crops but to
speculate with the prospect of a juicy future added value. As a French government
advisory body put it, “policies promoting agrofuels in developed or emerging countries,
with a mandatory percentage of these new fuels going to distributors, led to the
appearance of rents.” 249 Some investors have acquired land in quantities much larger
that they could use with a view of locking favourable terms and eliminating future
competition. 250 By setting mandatory targets and massively subsidising biofuels, the
EU creates a “heavily distorted biofuel market” and thereby an artificial land market. 251
The EU thus incentives biofuel development both in the EU and in the global South. 252
While giving predictability to investors, it artificially drives up the price of the
commodities (land and feedstock) necessary to produce biofuels and it gives
confidence for investments in land, including for purely speculative purposes. 253
In this context several companies based in the EU have found the necessary
confidence and support to grab hundreds of thousands of hectares of African
land. A report commissioned by Committee on Development of the European
Parliament finds that as a consequence of the ambitious EU biofuel target, securing
land for the production of energy crops in countries where land prices are low has
become an attractive business investment. 254 And whether it is to export to EU
Member States or to other countries does not matter, it is still a consequence of the
momentum generated by the EU policies, and, the EU and EU Member States are
responsible for the way their companies act abroad (see section 8.2.2).
5.3. Imposing an export industrial farming model on the
pressure of the agroindustry
The EU biofuel policy thus clearly drives land grabbing, using all the components of its
policy related to biofuels approach. Doing so, it imposes an export industrial farming
model which creates one of the worst forms of land grabbing.
Notably because it is focused on quantitative objectives, placing priority on
technological and market-based solutions, the EU biofuel policy tends to promote
large scale industrial exploitations. 255 In the words of the former UN Special
Rapporteur on the right to food, “the greatest risk is that dependence on the agroindustrial
model of production will fail to benefit poor peasant farmers and will generate
violations of the right to food”. 256 Evidence indicates that agrofuel production in
particular requires more capital intensive farming, which favours large agricultural
producers who are better connected to the markets. 257 The HLPE notes that “the bioenergy
market tends to promote large industrial plantations with efficient crop handling
and processing”. 258 This is also because economy of scale is key to profitable biofuel
production, and biofuel production involving smallholders does not seem to be, at least
for the moment, economically viable, 259 an analysis that is supported by pro-biofuel
studies. 260 In a book published by the World Bank in 2011, the author concludes a
review of three biofuel case studies in Africa by affirming that investors need to reach
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