More than at any time in the past three
decades, the world's attention is focused this year on food and agriculture.
A variety of factors have combined to raise food prices to the highest
levels since the 1970s (in real terms), with serious implications for food
security among poor populations around the world. One of the most frequently
mentioned contributing factors is the rapid recent growth in the use of
agricultural commodities - including some food crops - for the production
of biofuels. Yet the impact of biofuels on food prices remains the subject
of considerable debate, as does their potential to contribute to energy
security, climate-change mitigation and agricultural development. Even
while this debate continues, countries around the world confront important
choices about policies and investments regarding biofuels.
Given the urgency of these choices and
the magnitude of their potential consequences, it is agreed that careful
assessment of the prospects, risks and opportunities posed by biofuels
is essential. This is the focus of FAO's 2008 report on the State of
Food and Agriculture.
The report finds that while biofuels
will offset only a modest share of fossil energy use over the next decade,
they will have much bigger impacts on agriculture and food security. The
emergence of biofuels as a new and significant source of demand for some
agricultural commodities - including maize, sugar, oilseeds and palm oil
- contributes to higher prices for agricultural commodities in general,
and for the resources used to produce them. For the majority of poor households
who consume more food than they produce, higher prices can pose a serious
threat to food security - especially in the short term. But it is important
to keep in mind that biofuels are only one of many drivers of high food
prices: weather-related production shortfalls in major exporting countries,
low global cereal stocks, increasing fuel costs, the changing structure
of demand associated with income growth, population growth and urbanization,
operations on financial markets, short-term policy actions, exchange rate
fluctuations and other factors also play a role. Given appropriate policies
and investments, high prices can trigger a response in terms of increased
agricultural production and employment, which could contribute to poverty
alleviation and improved food security over the longer term.
The report also finds that the impact of biofuels on greenhouse gas emissions varies widely, depending on where and how the various feedstock crops are produced. In many cases, increased emissions from land-use change are likely to offset or even exceed the greenhouse gas savings obtained by replacing fossil fuels with biofuels, and impacts on water, soil and biodiversity are also a concern. Good agricultural practices and increased yields through technological developments and improved infrastructure can help reduce some of these adverse impacts. In the longer run, the emergence of second-generation biofuels may offer additional benefits.