The Global Bioenergy Expansion: How Large Are the Food−Fuel Trade-Offs?

  • Jacinto F. Fabiosa
  • John C. Beghin
  • Fengxia Dong
  • Amani Elobeid
  • Simla Tokgoz
  • Tun-Hsiang Yu
Part of the Natural Resource Management and Policy book series (NRMP, volume 33)


We summarize a large set of recent simulations and policy analyses based on FAPRI’s world multimarket, partial-equilibrium models. We first quantify and project the emergence of biofuel markets in US and world agriculture for the coming decade. Then, we perturb the models with incremental shocks in US and world ethanol consumption in deviation from this projected emergence to assess their effects on world agricultural and food markets. Various food−biofuel trade-offs are quantified and examined. Increases in food prices are moderate for the US ethanol expansion and even smaller for the ethanol expansion outside the United States, which is based on sugarcane feedstock, and which has little feedback on other markets. With the US expansion, the high protection in the US ethanol market limits potential adjustments in the world ethanol markets and increases the demand for feedstock within the United States. Changes in US grain and oilseed market prices propagate to world markets, as the United States is a large exporter in these markets. With changes in world prices, land allocation in the rest of the world responds to the new relative prices as in the United States but with smaller magnitudes because price transmission to local markets is less than full.


Ethanol Production Food Price Land Allocation Corn Price Ethanol Price 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.


  1. Abler D, Beghin J, Blandford D, and Elobeid A (2008) Changing the U.S. sugar program into a standard crop program: Consequences under NAFTA and Doha. Rev Agr Econ 30(1):82–102.CrossRefGoogle Scholar
  2. Elobeid A and Beghin J (2006) Multilateral trade and agricultural policy reforms in sugar markets. J Agr Econ 57(1):23–48.CrossRefGoogle Scholar
  3. Elobeid A, Tokgoz S (2008) Removal of US ethanol domestic and trade distortions: Impact on US and Brazilian ethanol markets. Amer J Agr Econ 90(4):918–932CrossRefGoogle Scholar
  4. Elobeid A, Tokgoz S, Hayes DJ, Babcock BA, Hart CE (2007) The long-run impact of corn-based ethanol on the grain, oilseed, and livestock sectors with implications for biotech crops. AgBioForum 10(1):11–18Google Scholar
  5. Energy Information Administration (EIA) (2008a) Fuel ethanol overview. Historical Energy Data, Monthly Energy Review, Renewable Energy. Energy Information Administration, Accessed June 2008
  6. Energy Information Administration (EIA) (2008b) Monthly Energy Review. State and US Historical Data. sAccessed June 2008
  7. Fabiosa JF (2008a) Distillers dried grain product innovation and its impact on adoption, inclusion, substitution, and displacement rates in a finishing hog ration. CARD Working Paper 08-WP 478, Center for Agricultural and Rural Development, Iowa State UniversityGoogle Scholar
  8. Fabiosa JF (2008b) Not all DDGS are created equal: An illustration of nutrient-profile-based pricing to incentivize quality. CARD Working Paper 08-WP 481, Center for Agricultural and Rural Development, Iowa State UniversityGoogle Scholar
  9. Fabiosa JF, Beghin JC, Dong F, Elobeid A, Tokgoz S, and Yu T (2007) Land allocation effects of the global ethanol surge: Predictions from the international FAPRI model. Economics Department Staff General Research Paper No 12877, Iowa State University, September forthcoming in Land EconomicsGoogle Scholar
  10. Fabiosa J, Beghin J, De Cara S, et al. (2005) The Doha Round of the WTO and Agri-cultural Markets Liberalization: Impacts on Developing Economies. Rev of Agr Econ 27(3):317–335.CrossRefGoogle Scholar
  11. International Grains Council (IGC) Grain market report. Various issues. Accessed June 2008
  12. Organization for Economic Cooperation and Development (OECD) (2008) Economic assessment of biofuel support policies. Directorate for Trade and Agriculture. Accessed February 2009
  13. Searchinger T, Heimlich R, Houghton R, et al. (2008) Factoring greenhouse gas emissions from land use change into biofuel calculations.Science (February 29):1238–1240.Google Scholar
  14. Tokgoz S,Elobeid A,Fabiosa J, et al.(2008)Bottlenecks, drought, and oil price spikes: Impact on US ethanol and agricultural sectors.Rev Agr Econ 30(4):604–622.CrossRefGoogle Scholar
  15. Tokgoz S, Elobeid A, Fabiosa J, et al. (2007) Emerging biofuels: Outlook of effects on US grain, oilseed, and livestock markets. Staff Report 07-SR 101, Center for Agricultural and Rural Development, Iowa State University, July (revised)Google Scholar
  16. Trostle R (2008) Global agricultural supply and demand: Factors contributing to the recent increase in food commodity prices. USDA Economic Research Service Report WRS-0801, July, Accessed February 2009
  17. USDA Foreign Agricultural Service (USDA-FAS) (2008a) Brazil: biofuels annual report 2008. Global Agriculture Information Network Report Number BR8013, July 22, Accessed July 2008
  18. USDA Foreign Agricultural Service (USDA-FAS) (2008b) People’s Republic of China: Biofuels annual report 2008. Global Agriculture Information Network Report Number CH8052, June 26, Accessed July 2008
  19. USDA National Agricultural Statistics Service (USDA-NASS) (2008) Quick stats: U.S. and all states data – crops. USDA-NASS. Accessed June 2008

Copyright information

© Springer Science+Business Media, LLC 2010

Authors and Affiliations

  • Jacinto F. Fabiosa
    • 1
  • John C. Beghin
    • 2
  • Fengxia Dong
    • 3
  • Amani Elobeid
    • 3
  • Simla Tokgoz
    • 4
  • Tun-Hsiang Yu
    • 5
  1. 1.Iowa State UniversityAmesUSA
  2. 2.Department of EconomicsIowa State UniversityAmesUSA
  3. 3.Center for Agricultural and Rural DevelopmentIowa State UniversityAmesUSA
  4. 4.International Food Policy Research InstituteWashingtonUSA
  5. 5.Department of Agricultural EconomicsUniversity of TennesseeKnoxvilleUSA

Personalised recommendations