page_title: Food vs. fuel
hierarchical_section_title: Food vs. fuel
caption_attribution_description: English: Ethanol plant under construction, Butler County.
context_page_description: Food versus fuel is the dilemma regarding the risk of diverting farmland or crops for biofuels production to the detriment of the food supply. The biofuel and food price debate involves wide-ranging views, and is a long-standing, controversial one in the literature. There is disagreement about the significance of the issue, what is causing it, and what can or should be done to remedy the situation. This complexity and uncertainty is due to the large number of impacts and feedback loops that can positively or negatively affect the price system. Moreover, the relative strengths of these positive and negative impacts vary in the short and long terms, and involve delayed effects. The academic side of the debate is also blurred by the use of different economic models and competing forms of statistical analysis.
  Biofuel production has increased in recent years. Some commodities like maize, sugar cane or vegetable oil can be used either as food, feed, or to make biofuels.
context_section_description: Food versus fuel is the dilemma regarding the risk of diverting farmland or crops for biofuels production to the detriment of the food supply. The biofuel and food price debate involves wide-ranging views, and is a long-standing, controversial one in the literature. There is disagreement about the significance of the issue, what is causing it, and what can or should be done to remedy the situation. This complexity and uncertainty is due to the large number of impacts and feedback loops that can positively or negatively affect the price system. Moreover, the relative strengths of these positive and negative impacts vary in the short and long terms, and involve delayed effects. The academic side of the debate is also blurred by the use of different economic models and competing forms of statistical analysis.
  Biofuel production has increased in recent years. Some commodities like maize (corn), sugar cane or vegetable oil can be used either as food, feed, or to make biofuels.  For example, since 2006, a portion of land that was also formerly used to grow other crops in the United States is now used to grow corn for biofuels, and a larger share of corn is destined to ethanol production, reaching 25% in 2007.  Second generation biofuels could potentially combine farming for food and fuel and moreover, electricity could be generated simultaneously, which could be beneficial for developing countries and rural areas in developed countries.
  With global demand for biofuels on the increase due to the oil price increases taking place since 2003 and the desire to reduce oil dependency as well as reduce GHG emissions from transportation, there is also fear of the potential destruction of habitats by being converted into farmland. Environmental groups have raised concerns about this trade-off for several years, but the debate reached a global scale due to the 2007–2008 world food price crisis. On the other hand, several studies do show that biofuel production can be significantly increased without increased acreage. Therefore, stating that the crisis in hand relies on the food scarcity.
  Biofuels are not a new phenomenon. Before the industrialisation, horses were the primary (and humans probably the secondary) source of power for transportation and physical work, requiring food. The growing of crops for horses (typically oat) for carrying out physical work is of course comparable to the growing of crops for biofuels for engines, albeit on a smaller scale, because production since then has increased.
  Brazil has been considered to have the world's first sustainable biofuels economy and its government claims Brazil's sugar cane based ethanol industry has not contributed to the 2008 food crisis. A World Bank policy research working paper released in July 2008 concluded that "...large increases in biofuels production in the United States and Europe are the main reason behind the steep rise in global food prices", and also stated that "Brazil's sugar-based ethanol did not push food prices appreciably higher". However, a 2010 study also by the World Bank concluded that their previous study may have overestimated the contribution of biofuel production, as "the effect of biofuels on food prices has not been as large as originally thought, but that the use of commodities by financial investors (the so-called "financialisation of commodities") may have been partly responsible for the 2007/08 spike." A 2008 independent study by OECD also found that the impact of biofuels on food prices are much smaller.
caption: An ethanol fuel plant under construction, Butler County, Iowa
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