Sugarcane ethanol: Contributions to climate change - BAFF

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Why are current food prices so high?
A constant crude oil price implies 10% lower prices for all three commodities, due
to the fact that the assumed high crude oil price under the reference scenario will
make biofuel crops more pro�table.
Lower income growth is especially relevant for vegetable oils (more than 10%).
A stronger US dollar of 10% leads to about 5% lower prices for wheat, maize and
vegetable oil relative to the baseline.
Higher growth rates in yields for important biofuel crops will lower the world market
prices for their production by more than 5% for wheat and maize.
�ese results are inline with our own results on the impact of biofuel policies, which are
presented in Figure 12.
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0%
-5%
-10%
-15%
-20%
-25%
-30%
-35%
-40%
-45%
Wheat Maize Vegetable oil
Scenario 5 : Scenario 4 and yields for wheat, oilseeds and coarse grains 5 % higher
than over the projection period
Scenario 4 : Scenario 3 and Progressive appreciation of the USD exchange rates to
reach 10% higher rates in 2017
Scenario 3 : Scenario 2 and Lower income growth in EE5 countries
(half annual growth rate)
Scenario 2 : Scenario 1 and Oil price constant at 2007 level (72$)
Scenario 1 : Biofuel production constant at 2007 level
Figure 11. Sensitivity on analysis of world price changes. Source: OECD-FAO Agricultural Outlook
2008-2017. Highlights. (2008).
International Food Policy Research Institute (IFPRI) study (e.g. Von Braun et al., 2008).
– �e percentage contribution of biofuels demand to price increases from 2000-07 is
the di�erence between 2007 prices in the two scenarios, divided by the increase in
prices in the baseline from 2000-2007.
– �e increased biofuel demand between 2000 and 2007, compared with previous
historical rates of growth, is estimated to have accounted for 30 percent of the increase
in weighted average cereal prices during 2000-07.
› Maize – 39%.
› Rice – 21%.
› Wheat – 22%.
Sugarcane ethanol 239