Impacts of biofuel targets on land use and food supply


April 6, 2011

The increased global production of biofuels such as ethanol has become a subject of controversy, as land formerly dedicated to the growing of food crops is repurposed to meet energy needs. Each year, more crops such as sugar, palm oil, corn and cassava are diverted for these purposes.

A 2010 paper by the World Bank, “The Impacts of Biofuel Targets on Land-Use Change and Food Supply,” uses land-allocation information from the biofuels production sectors to determine the levels of competition between biofuels and food industries for agricultural commodities. The authors model the potential effects of increased biofuels production to meet current national targets.

The paper’s findings include:

  • Expanding global biofuels production to meet current national biofuels targets would generally reduce global GDP between 0.02% and 0.06%, with the national GDP impacts varying across countries.
  • Significant Expansion in biofuels production would necessitate substantial land re-allocation, resulting in as much a 5% decreases in forest and pasture lands.
  • The expansion of biofuels would likely cause a 1% reduction in global food supply.
  • The magnitude of the impact on food costs is not as large as perceived earlier — sugar, corn and oil seeds would experience 1% to 8% price increases by 2020 — but increases would be significant in developing countries such as India and those in Sub-Saharan Africa.

Overall, the results from the study’s models indicate that increased biofuels production may have significant impacts on the global food supply, economy and environment.

Tags: cars, fossil fuels, water


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Citation: Govinda R. Timilsina; et al. "The impacts of biofuels targets on land-use change and food supply: A global CGE assessment," Agricultural Economics, May, 2012, Vol. 43, Issue 3, 315–332. DOI: 10.1111/j.1574-0862.2012.00585.x