NARRATIVE

Bioenergy policy, markets and trade and food security

Date: 18-20 February 2008

Background

Rising biofuel production has become the most significant source of new demand for many agricultural and food products as they provide feed-stocks to the production of ethanol and biodiesel fuels.  This does not appear to be a short term situation, but one which while now commanding attention for commodities with high sugar/starch and oil content, is expected to give way to a new generation of technologies and agricultural products with different implications for land use and bio-fuel trade.

That production of biofuels are based on renewable resources, that their use reduces or is perceived to reduce the emission of harmful green house gasses, that they enhance the energy security of countries that import crude oil, and that their production may also boost domestic farm incomes, are influential factors generating substantial policy development on a global scale.  Policy targets have been established in many countries, and policy instruments of diverse kinds are being established to achieve them.  Both the nature of these instruments and their collective sum are now seen to be disrupting international agriculture markets, distorting trade, creating higher food prices, and distorting investment incentives in biofuel technology development itself.  These policies need to be assessed more definitively against their goals, including the important questions of spill-over and collateral effects, including who wins and who loses from such policies, as among countries, between urban and rural society, and across individuals in terms of income and food security.  Policy makers acting in both national and international contexts need to be informed about the impacts of these policies in order to take action to assure that biofuel policies will responsibly make use of emerging technologies to the benefit of all.

Key questions

• Is the policy set being currently pursued to support the biofuels related sectors independently by countries harmful to agricultural markets, trade and, hence, food security?
• Is coordination of these policies at the international level necessary?
• If the answer to the second question is yes, what institutional setting would be required to develop the most effective and efficient policy instruments?

Expected outputs

• A options brief with a set of key messages for the High Level Conference on Food Security and the Challenges of Climate Change and Bioenergy and FAO’s role
• A technical background paper highlighting the responses to the key questions on discussion and outcome of the expert meeting
• An enhanced network for collaboration for FAO’s future support to member countries