UPDATE 1-U.N.'s Pachauri urges caution in biofuel use

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By Ingrid Melander

BRUSSELS, March 26 (Reuters) - The world must take care when developing biofuels to avoid perverse environmental effects and higher food prices, Nobel Peace Prize winner and climate change scientist Rajendra Pachauri said on Wednesday.

Speaking at the European Parliament, he questioned whether the United States' policy of converting corn (maize) into ethanol for use as a transport fuel would reduce the emission of greenhouse gases blamed for global warming.

Controversy has grown over using food crops to make biofuels as an alternative to fossil fuels. Some environmentalists and politicians say it has raised food prices, distorted government budgets and led to deforestation in southeast Asia and Brazil.

"We should be very, very careful about coming up with biofuel solutions that have major impact on production of food grains and may have an implication for overall food security," Pachauri, chairman of the U.N.'s Intergovernmental Panel on Climate Change, told a news conference.

"Questions do arise about what is being done in North America, for instance to convert corn into sugar then into biofuels, into ethanol," he said.

The United States is the world's biggest producer of biofuels, derived mostly from corn.

"Several questions have arisen on even the emissions implication of that route, and the fact that this has clearly raised prices of corn," said Pachauri, whose panel shared the Nobel prize with former U.S. Vice President Al Gore last year.