By Raymond Colitt

BRASILIA, April 16 (Reuters) - President Luiz Inacio Lula da Silva defended Brazil's production of biofuels on Wednesday, rejecting criticism they are furthering a surge in global food prices and harming the environment.

"Don't tell me, for the love of God, that food is expensive because of biodiesel. Food is expensive because the world wasn't prepared to see millions of Chinese, Indians, Africans, Brazilians and Latin Americans eat," Lula told reporters before speaking at a conference of the U.N. Food and Agriculture Organization (FAO) in Brasilia.

"We want to discuss this not with passion but rationality and not from the European point of view," Lula said.

Lula's comments follow a week of criticism and protests in Europe and Brazil against fuels derived from food crops and their supposed environmental and social benefits.

The growing criticism is a challenge to Brazil's diplomacy and its agricultural export boom, which has seen it become the world's largest exporter of ethanol -- derived from sugar cane -- and place it at the center of the global biofuels debate.

Competitors and critics have tried to link several of Brazil's leading farm exports, from beef to soybeans, with environmental destruction and poor working conditions.

"Brazil is prepared for this debate. I and my government are ready to travel around the world," Lula said.

Critics say the increased production of crops for ethanol and biodiesel, which is derived from oil seeds, is using up land that would otherwise by used for food crops. In Brazil, they say it is also pushing cattle ranchers and farmers further north and contributing to the destruction of the Amazon rainforest.

Some of Brazil's neighbors, including Venezuela and Bolivia, warned at the FAO conference this week that biofuels could increase malnutrition in Latin America.

Brazil has repeatedly argued that it has plenty of unused land to plant crops for biofuels and that current production was still too small to affect food prices.

The Brazilian government rejected this week a voluntary code of conduct to guide the production and use of biofuels, saying the proposal made in the FAO meeting needed further study.

The European Union's environment chief said on Tuesday that biofuels, which Brazil hopes to export to the EU, now must meet social and environmental criteria. Scientists from the European Environment Agency urged the 27-nation bloc to drop its 10 percent biofuel target for road-transport fuels.

(Reporting by Raymond Colitt, editing by Stuart Grudgings and Philip Barbara)

(For more stories on global food price rises, please see http://www.reuters.com/news/globalcoverage/agflation)

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