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Liquid Biofuels for Transport Prospects, risks and opportunities

7. Conclusions

  • 7.1 Do biofuels threaten food security?
  • 7.2 Can biofuels help promote agricultural development?
  • 7.3 Can biofuels help reduce greenhouse gas emissions?
  • 7.4 Do biofuels threaten land, water and biodiversity?
  • 7.5 Can biofuels help achieve energy security?

7.1 Do biofuels threaten food security?

The source document for this Digest states:

Questions addressed by the report

The key questions addressed by the report and the answers provided can be summarized as follows.

Do biofuels threaten food security?

For poor net buyers of food staples in both urban and rural areas, higher food prices resulting in part from increased biofuel demand will pose an immediate threat to their food security. Even if biofuels are only one of several sources of the recent sharp increases in food prices, expanded biofuel production can still continue to exert upward pressure on food prices for considerable time to come. The immediate impact of high food prices on the poor can be mitigated through appropriately designed and targeted safety nets that support access to food. At the same time, it is important to allow rising prices to feed through to farmers so as to trigger a possible supply response. Imposing price controls and export bans, as many countries have done in 2008 in efforts to protect consumers from high prices, prevents markets from adjusting and, while providing an apparent short-term relief, may actually prolong and deepen the food-security crisis. If markets are allowed to function and price signals are effectively transmitted to producers, higher prices will provide an incentive for increased production and increased employment, which may alleviate food-security concerns over the longer term.

Source & ©: FAO, The State of Food and Agriculture, Part I: Biofuels: Prospects, Risks and Opportunities (2008) ,
Chapter 7, Section Questions addressed by the report, p.87

7.2 Can biofuels help promote agricultural development?

The source document for this Digest states:

Can biofuels help promote agricultural development?

Although higher prices for agricultural commodities constitute an immediate threat to food security for poor consumers worldwide, in the longer run they represent an opportunity for agricultural development. This opportunity can be realized only when and where the agriculture sector has the capacity to respond to the price incentives and poor farmers, in particular, are able to participate in the supply response. Expanding demand for biofuels may reverse the long- term decline in real agricultural commodity prices that, for decades, has discouraged public and private investment in agriculture and rural areas in many developing countries. These countries may be able to use this opportunity to revitalize their agriculture sectors, but, as for agriculture in general, their ability to do this will depend on investments in infrastructure, institutions and technology, among other factors. Promoting access to productive resources, particularly

by smallholders and marginalized groups such as women and minorities, will strongly improve the likelihood that agriculture can serve as an engine of growth and poverty reduction. Opportunities would also be expanded by the removal of subsidies and trade barriers that benefit producers in OECD countries at the expense of producers in developing countries.

Source & ©: FAO, The State of Food and Agriculture, Part I: Biofuels: Prospects, Risks and Opportunities (2008) ,
Chapter 7, Section Questions addressed by the report, Subsection Can biofuels help promote agricultural development?, p.87-88

7.3 Can biofuels help reduce greenhouse gas emissions?

The source document for this Digest states:

Can biofuels help reduce greenhouse gas emissions?

Some biofuels may, under certain conditions, help reduce greenhouse gas emissions. In practice, however, the global effects of an expansion of biofuel production will depend crucially on where and how the feedstocks are produced. Land-use change resulting from increased feedstock production is a key determining factor. For many locations, emissions from land-use change – whether direct or indirect – are likely to exceed, or at least offset, much of the greenhouse gas savings obtained by using biofuels for transport. Moreover, even when biofuels are effective in reducing greenhouse gas emissions, they may not be the most cost- effective way of achieving this objective compared with other options. Good agricultural practices and increased yields can help mitigate some of the negative greenhouse gas effects arising from land-use change, and technological developments and improvements in infrastructure, leading to increased yields per hectare, can contribute to a more favourable outcome. Second-generation technologies, in particular, may improve the greenhouse gas balance of biofuel production significantly.

Source & ©: FAO, The State of Food and Agriculture, Part I: Biofuels: Prospects, Risks and Opportunities (2008) ,
Chapter 7, Section Questions addressed by the report, Subsection Can biofuels help reduce greenhouse gas emissions?, p.88

7.4 Do biofuels threaten land, water and biodiversity?

The source document for this Digest states:

Do biofuels threaten land, water and biodiversity?

As for any form of agriculture, expanded biofuel production may threaten land and water resources as well as biodiversity, and appropriate policy measures are required to minimize possible negative effects. The impacts will vary across feedstocks and locations and will depend on cultivation practices and whether new land is converted for production of biofuel feedstocks or other crops are displaced by biofuels. Expanded demand for agricultural commodities will exacerbate pressures on the natural resource base, especially if the demand is met through area expansion. On the other hand, the use of perennial feedstocks on marginal or degraded lands may offer promise for sustainable biofuel production, but the economic viability of such options may be a constraint at least in the short run.

Source & ©: FAO, The State of Food and Agriculture, Part I: Biofuels: Prospects, Risks and Opportunities (2008) ,
Chapter 7, Section Questions addressed by the report, Subsection Do biofuels threaten land, water and biodiversity?, p.88

7.5 Can biofuels help achieve energy security?

The source document for this Digest states:

Can biofuels help achieve energy security?

Liquid biofuels based on agricultural crops can only be expected to make a limited contribution to global supply of transport fuels and a yet smaller contribution to total energy supplies. Because agricultural markets are small relative to energy markets, expanding biofuel production quickly bids up the price of agricultural feedstocks and makes them uncompetitive against petroleum-based fuels. However, countries with a large natural-resource base that can produce feedstocks competitively and process them efficiently may be able to develop an economically viable biofuel sector. Unforeseen changes in energy markets could also change the economic viability of biofuels. Technological innovation – including the development of second- generation biofuels based on cellulosic feedstocks – may expand the potential and the range of countries where biofuels could make a significant contribution to energy security. However, it is not clear when second-generation technologies may become commercially viable. When they do, first- and second-generation fuels are likely to continue to coexist; the bulk of biofuel supply will be provided by first-generation biofuels, based on sugar, starchy and oil crops at least for a decade.

Source & ©: FAO, The State of Food and Agriculture, Part I: Biofuels: Prospects, Risks and Opportunities (2008) ,
Chapter 7, Section Questions addressed by the report, Subsection Can biofuels help achieve energy security?, p.88


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