BIOFUELS, ENERGY AND AGRICULTURE:
Powering Towards or Away From Food Security?

This was another of the Crawford Fund's provocative free annual development conferences.

The Crawford Fund's annual conferences highlight an important aspect of feeding and greening the world and we believe that this year's event will be another in our series of thought provoking, well attended and nationally reported events.

Biofuel

The future energy demands of rapidly-developing countries, the increasing concerns about the reliability of oil supplies and costs, the climate changes that are likely to result from burning fossil fuels and the certainty that transport will remain a major user of liquid energy sources for many years are key issues in current thinking about future energy supplies. These concerns have led to a dramatic re-assessment of the role of biofuels - liquid fuels including ethanol and biodiesel derived from organic matter.

This year we chose to consider the range of issues for developing countries and for Australia due to this growing interest in biofuels as a partial substitute for fossil fuels and what that may mean for food production and food prices, and to highlight the need for international agricultural research (IAR) to mitigate these downsides and identify options for the sustainable production and use of biofuels.

MEDIA MATERIALS AND INFORMATION

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BACKGROUND AND CONTEXT

Energy is essential for our way of life and for economic growth, and is a key input to agricultural production. This is just as true for developing countries as for developed countries such as Australia. The global energy demand is expected to increase by 50% in the next 25 years, and more than two-thirds of this growth is expected to occur in developing countries and emerging economies in the Asia-Pacific region, particularly China, India, Indonesia and Malaysia.

There is a prevailing view that fossil fuels (oil, gas and coal) will still provide 80% of the world's energy by 2030, although some people consider that world oil production may have peaked. The transport sector accounts for a quarter of the world's energy use and also contributes a quarter of the world's greenhouse gas emissions. It is a particularly big user of oil; almost 60% the world's oil is used in transport and 97% of all transport fuel comes from oil.

Jatropha in India

Production of biofuels is expected to increase at least threefold by 2030, growing to about 3 million barrels (477 million litres) per day (about 175 billion litres/year). Some country snapshots are:

• In the USA, government incentives and enthusiastic investment by the private sector are currently driving a massive expansion of the biofuels industry; ethanol plants recently built or already under construction will lift production by 30% within the next year. In January 2007 President Bush announced a plan to reduce the USA's petrol consumption by 20% by 2017, mostly by replacing petrol with ethanol, thus reducing reliance on Middle Eastern oil by 75% by 2025.
• In Brazil, already the world's biggest biofuel producer, a recent study conducted by the University of Campinas for the Ministry of Science and Technology showed that Brazil could lift annual exports of ethanol derived from sugarcane to 200 billion litres during the next 20 years - sufficient to replace 10% of the world's petrol demand.
• Several other developing countries (eg Thailand, India, China) are strengthening their production and use of biofuels, and Malaysia has announced its intention of producing biodiesel from palm oil for export to Europe.
• In Australia, the Government has set an annual target of 350 million litres of biofuel production by 2010 (a 5-fold increase), and this looks likely to be surpassed during the next 2-3 years. Most of it will likely come from fermentation of grain, but some will come from sugar.

There is a perception that biofuels may offer an income bonanza to farmers world-wide. Some analysts see biofuels as a major new opportunity for farmers in developing countries to generate income, and UNCTAD (the UN Conference on Trade and Development) in mid-2005 set up a significant Biofuels Initiative.

But a flip side to this optimism is serious concern in relation to what this means for developing countries and for food security.

For example, one key downside of expanded biofuel production will be its potential impact on world food supplies and food prices:

• Europe has mandated a 5.75% use of biofuels by 2010. If achieved, this could require 20% of Europe's cropland to be diverted from food to fuel production.
• In the USA, a 10% substitution of biofuel for petrol and diesel by 2020 could require 43% of the cropland to be diverted.
• If Australia were to replace 10% of its unleaded petrol with bio-ethanol, and if this were to come from fermentation of wheat, it could require about 40% of our annual average wheat crop.

Ethanol Plant

In summary, the effect on world food prices of these kinds of levels of biofuel use (should they occur) would be severe if land currently used for food production was diverted to biofuel production.

There are positive developments underway and on the horizon for new biofuels technologies (such as the production of ethanol from cellulose) which may mediate these concerns. Even if cellulose became the biofuel source (rather than grain or sugar), there would be unknown (but possibly significant) impacts on the maintenance of soil fertility and on destruction of forests.

A key research issue is the development of technology that will raise the economic viability of ethanol production from cellulose. Another key issue is the role of the private sector - without large-scale investment in production and marketing the biofuel industry will languish, and the private sector is undertaking much of the research on biofuel production and holds relevant intellectual property. And yet another key issue is the policy environment for biofuels - how will Australia respond to the protective and stimulatory policy settings of competing countries?

CONFERENCE OBJECTIVES

The Crawford Fund expects that the conference would have:

• alerted the Australian community to the current and emerging technologies for the production of biofuels.
• highlighted the opportunities that biofuels provide as a partial substitute for fossil fuels;
• raised public awareness of the role of biofuels as a means of lifting farmers' incomes in developing countries and Australia during the next 20 years;
• assessed the possible downsides of widespread use of biofuels, particularly the possible trade-off in reduced food production and higher food prices; and
• examined the need for international agricultural research (IAR) to mitigate these downsides and identify options for the sustainable production and use of biofuels.

SPEAKERS

The event brought together international and national leaders and specialists in the broad range of issues of interest in Australia and globally related to biofuels and agriculture. These included:

• The Hon. Alexander Downer, Minister for Foreign Affairs
• Dr Joachim Von Braun, Director General, International Food Policy Research Institute
• Lord Ron Oxburgh, Member, House of Lords, UK; Chairman of D1 Oils plc, and former Chairman of Shell
• Dr Stephen Schuck , Manager, Bioenergy Australia; Executive Committee Member and Member for Australia on International Energy Agency - IEA Bioenergy
• Dr Weber Amaral, President, National Brazil Biofuels Program
• Dr Alok Adholeya, Director, Biotechnology and Management of Bioresources Division, The Energy and Resources Institute, India
• Dr John Wright, Director, CSIRO Energy Transformed Flagship Program, and previously Chief, CSIRO Energy Technology
• Mr Michael Taylor, Secretary, Australian Government Department of Transport and Regional Services
• Mr Peter Core, Director, Australian Centre for International Agricultural Research

BIOGRAPHICAL DETAILS AND ABSTRACTS

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• Click here for abstracts of presentations
• Click here for speakers power point presentations

PROGRAM

The full program appears below:

BIOFUELS, ENERGY AND AGRICULTURE:
Powering Towards or Away From Food Security?

• Click here for a PDF copy of the conference program

SPONSORS

The Crawford Fund wishes to thank its supporters and sponsors for the event including:

• AusAID - the Australian Agency for International Development
• Australian Centre for International Agricultural Research
• Australian Government Department of Agriculture, Fisheries and Forestry
• Australian Government Department of Transport and Regional Services
• Bioenergy Australia
• Energy Transformed Flagship
• Grains Research and Development Corporation
• International Food Policy Research Institute
• Rural Industries Research and Development Corporation

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