Transport Biofuels, Food Prices and Food Security

As to the effect of biofuels on food security, it has already been noted in Chap. 1 that substantial production of transport biofuels will, under market conditions, have an upward effect on food prices. Prices of food crops which also serve as major feed­stocks for biofuels are likely to show linkage with fuel prices. The price of sugar in Brazil is now linked to the price of ethanol, and large-scale use of carbohydrates and vegetable oils as transport biofuel feedstocks may be expected to link the prices thereof to fossil fuel prices, corrected for differences in ‘energy content’ (Naylor et al. 2007; von Braun 2007; Eickhout et al. 2008; Westhoff 2008). The effect of an expanding transport biofuel production on food prices may lead to an increased insufficiency of food for the world’s poorest people that are not net food producers and currently spend 50-80% of their total household income on food (Naylor et al. 2007; Runge and Senauer 2007, Daschle et al. 2007; von Braun 2007). Fast expan­sion of transport biofuel feedstock production might be expected to have a relatively strong upward effect on food prices (von Braun 2007).

The upward effect of transport biofuel production on food prices partially follows from competition between food crops and biofuel crops for good-quality land. This competition occurs both when transport biofuels are based on feedstocks that can be used for food or feed and in the case that feedstocks for lignocellulosic biofuels are grown (Christersson 2008). Thus, the competition extends to part of the lig — nocellulosic transport biofuels, including biofuels made from lignocellulosic crops, such as Miscanthus (e. g. S0rensen et al. 2008), and biofuels from lignocellulosic by­products which are currently used as animal feed (e. g. Linde et al. 2008; Murphy and Power 2008).

However, it may be expected that when lignocellulosic biofuels contribute sub­stantially to transport biofuel production, the upward effect on food prices will be reduced. This is even more so when lignocellulosic crops are converted into electric­ity for electric traction, because the seed-to-wheel solar energy conversion efficiency is relatively high (see Chap. 2). There will also be an effect when lignocellulosic biomass is converted into biofuel for internal combustion engines, because in this case, more cropped biomass can be turned into transport biofuel. The magnitude of this effect is uncertain, however, as it is not clear how much lignocellulosic biomass can be diverted to transport biofuel production without having a negative impact on soil organic matter levels and animal feed supplies.

The competition between food crops and biofuel crops also appears to apply to biofuel crops which are well adapted to growth on poor-quality land. One example thereof is Eucalyptus. Around 1900, Eucalyptus was promoted for growth on ‘waste lands, where few other trees would grow’ (Doughty 2000). However, now it is often grown on good-quality land in competition with food crops, which has led to restric­tions on Eucalyptus cultivation in some countries (see Chap. 3). More recently, the oil crop Jatropha has been promoted because of its ability to grow on marginal land (Kaushik et al. 2007; Achten et al. 2009). However, as evidenced by the eviction of small-scale farmers in Tanzania for large-scale Jatropha cropping (Gross 2008) and the replacement of rice production by Jatropha in Burma (Ethnic Community De­velopment Forum 2008), in practice, Jatropha cultivation may well compete with food production. It has also been found on the basis of experience with Jatropha cultivation in Belize, Nicaragua and India that to be competitive, cultivation has to be intensified beyond that of a rain-fed, low-input and drought-resistant crop (Euler and Gorriz 2004). This should be no surprise as on the biodiesel market, Jatropha oil also has to compete with vegetable oils, which have been grown under good conditions which are conducive to high yields.

To the extent that the competition between food and transport biofuel crops for good-quality land has been studied for the United States, a rather general upward effect on food prices has been found (Walsh et al. 2003; Johansson and Azar 2007; Schneider et al. 2007). However, there may also be differential effects of biofuel crops on the prices of specific foods. These depend on actual crops that are used for the production of transport biofuels. Elobeid and Hart (2007) have modelled the effect of expanding bioethanol from corn production in the USA and found the biggest impact on food-basket costs in sub-Saharan Africa and Latin Amer­ica, where corn is a major food grain. A lower impact was expected in Southeast Asia where rice is a major food grain, with countries where wheat and/or sorghum are major staples falling in between. To lessen the effects of biofuel feedstocks on Chinese food prices, in 2008, China began to import cassava as feedstock from Malaysia, the Philippines, Indonesia and Nigeria (Tenenbaum 2008). When China is to heavily rely on cassava as a feedstock for bioethanol production, it would seem likely that prices of this ‘poor man’s food’ may be much increased (Naylor et al. 2007).

Is there a strategy for developing transport biofuels that will not have an upward impact on food prices? The answer to this question should take account of a down­ward pressure on crop production associated with climate change and increasing land claims associated with agricultural production for an increasing world popu­lation with consumption patterns that increasingly favour animal produce (Tilman et al. 2001; Reijnders and Soret 2003; Swedish Environmental Advisory Council 2007; Koneswaran and Nierenberg 2008; von Braun 2007). The latter development will in all probability intensify competition for good-quality land.

To the extent that one relies on crops for the supply of transport biofuel feed­stock, while relying on market forces, direct competition with food and feed pro­duction therefore seems inevitable, as does an upward effect on food prices. In this respect, there are likely to be quantitative differences linked to the relative yield of transport biofuels per hectare. These differences can be substantial, as shown in Chap. 2. From the data presented in Chap. 2, it would seem that crops proposed for the generation of lignocellulosic feedstock are not necessarily superior to current food crops such as sugar beet and sugar cane as to their net efficiency in converting solar radiation into biomass. How they will perform in net yield of biofuels is rather

uncertain because technologies for the conversion of lignocellulosic biomass into transport biofuels are under development, and there is uncertainty about yields that may be possible in the future and the extent to which aboveground biomass should be returned to soils to maintain soil organic matter levels.

Still, it is to be expected that some biofuels would not lead to an upward move­ment of food prices. Firstly, biofuels produced from what are currently ‘wastes’, such as organic urban wastes, biomass from forest remediation and residues from forestry and agriculture, which are not used as animal feed, may partly qualify as such. The worldwide amount of these wastes is currently estimated at between 50 and 100 EJ (Swedish Environmental Advisory Council 2007; Lysen and van Egmond 2008). Unfortunately, it is not clear how much thereof is necessary for maintaining soil organic carbon stocks in a steady state to safeguard the future productivity of arable lands and forests (see Chap. 3). However, even when only 10-20% thereof could be diverted to transport biofuel production, this would still represent a substantial contribution to the transport fuel supply.

Another option that has been suggested in this context is growing microalgae (Chisti 2007, 2008; Dismukes et al. 2008; Groom et al. 2008). However, as pointed out in Chap. 2, an overall positive energy conversion efficiency of microalgal bio­fuels currently seems uncertain. There is also the water demand associated with growing algae, which may, per kilogram of dry weight biomass, be larger than, for example, sugar cane (see Chap. 3). This may lead to claims which may easily com­pete with agricultural land use.

Still another option is the use of abandoned cropland and lands that sequester little carbon today (Searchinger et al. 2008). The use of terrestrial plants to reclaim deserts may make it possible to harvest lignocellulosic biomass or oil (from, e. g. Ja — tropha). Of course, sustainable productivity of reclaimed drylands is relatively low. Apart from human intervention, actual productivity depends on rainfall (Webb et al. 1978). In tropical and subtropical areas with precipitation below 500mmyear-1, abovegroundC sequestration may be roughly between 0.15 and 1.5Mgha-1year-1 (Hadley and Szarek 1981). Increased sustainable yields may be possible by effi­cient water management and conservation practices (Thomas 2008). In semi-arid (500-750 mm rainfall year-1) and sub-humid (750-1,000mm rainfall year-1) envi­ronments with relatively high insolation, aboveground C sequestration may amount to 2-3 Mg C ha-1year-1 (Lal 2001). In humid Icelandic deserts, restoration activ­ities have led to the sequestration of 0.6-1.1Mg C ha-1year-1 (Aghstdottir 2004). After reclaiming lands with little C sequestration, there are often competing uses. For example, biomass may be exploited for grazing (Brown 2003; Darkoh 2003; McNeely 2003; Lal 2008; Ludwig et al. 2008), and this may lead to limitations on use for biofuel production.

If compared with reclaimed deserts, biomass production may be higher on cur­rently abandoned and fallow agricultural lands, with proper use of organic amend­ments and fertilizers and appropriately adopted plant species (Lal and Bruce 1999). Field et al. (2008) and Campbell et al. (2008) have estimated that such lands com­prise about 385-472 x 106 ha. In Chap. 3, it has been estimated that, after restoration of soil organic matter and nutrient levels, the worldwide sustainable feedstock pro­duction on such lands may be in the order of 23-28 EJ. When one assumes that the conversion efficiency thereof to transport biofuels is 40-50%, this would allow for the production of 8.6-14 EJ of transport fuels, which would be a substantial contri­bution to the 85-90 EJ of transport fuels that is currently used in means of transport.

Higher yields may be possible by intensifying cultivation of lands which cur­rently sequester little C and agricultural lands that have been abandoned or fallow, but it is highly doubtful that the biofuels generated in this way could be considered sustainable. As pointed out in Chap. 5, to be successful, this way to exploit fallow and abandoned agricultural land should be viewed by the local population as being in line with their pressing needs. Moreover, for the large-scale cultivation on aban­doned and fallow croplands and lands that currently sequester little C, one has to go beyond the market mechanism. For instance, in the case of palm oil, in Malaysia, planting oil palms on abandoned land is currently rare, because degraded land does not provide revenue from initial timber extraction and entails relatively high estab­lishment costs and possibly reduced yields (Wicke et al. 2009). More in general, the profitability of abandoned cropland and land that currently sequesters little C tends to be less than for good-quality agricultural land (Huston and Marland 2003; Johansson and Azar 2007). Therefore, large-scale cultivation of crops for transport biofuels on degraded cropland and in the context of desert reclamation will probably depend on government interventions (see Sect. 6.7).