Global discussion of biofuels and food security

Abstract

Food price hikes and biofuel expansion occurred all over the world from 2006 to 2008. Some agricultural and other specialists warned that biofuel expansion caused increases in agricultural commodity and food prices. There was a critical argument that global food-based biofuels may have a negative impact on food security on a global level. The author conducted research on how biofuel policy can impact on agricultural markets by utilizing economic models. As a result of the analysis for the Brazilian bioethanol policy, it was demonstrated that Brazil’s bioethanol policy has a floor price effect for the international sugar price and the increasing the anhydrous bioethanol blend ratio can play a role in reducing domestic sugar price instability. The analysis for the Brazilian biodiesel policy shows that the increasing biodiesel blend ratio will not always have a negative impact on the agricultural and food markets. The analysis of biofuel imports shows that the expansion of Chinese and Japanese bioethanol imports from Brazil could have an impact on world sugar markets. The analysis for the U.S. bioethanol impact on world corn markets shows that the U.S. bioethanol consumption could affect world corn prices by 22.2–37.4 %.