Biofuels versus food production: Does biofuels production increase food prices?

Abstract

Rapidly growing fossil energy consumption in the transport sector in the last two centuries caused problems such as increasing greenhouse gas emissions, growing energy dependency and supply insecurity. One approach to solve these problems could be to increase the use of biofuels. Preferred feedstocks for current 1st generation biofuels production are corn, wheat, sugarcane, soybean, rapeseed and sunflowers. The major problem is that these feedstocks are also used for food and feed production. The core objective of this paper is to investigate whether the recent increase of biofuels production had a significant impact on the development of agricultural commodity (feedstock) prices. The most important impact factors like biofuels production, land use, yields, feedstock and crude oil prices are analysed. The major conclusions of this analysis are: In recent years the share of bioenergy-based fuels has increased moderately, but continuously, and so did feedstock production, as well as yields. So far, no significant impact of biofuels production on feedstock prices can be observed. Hence, a co-existence of biofuel and food production seems possible especially for 2nd generation biofuels. However, sustainability criteria should be seriously considered. But even if all crops, forests and grasslands currently not used were used for biofuels production it would be impossible to substitute all fossil fuels used today in transport.