Biofuels and the poor: global impact pathways of biofuels on agricultural markets
This study seeks to assess the future impacts of biofuel production on regional agricultural and related sectors over the next decade with a specific focus on the vulnerable regions of developing nations. Using a modification of the GTAP modeling platform to account for the global interactions of regional biofuel and food markets, the analysis shows that biofuel production levels depend on the assumption about the future price of energy and the nature of the substitutability between biofuels and petroleum-based transport fuels. Low energy prices reduce the demand for biofuels and thus require greater government support to meet the desired production targets. At the other extreme, when prices are high and there is scope for substituting biofuels for petroleum-based fuels, the volume of biofuels produced will exceed the mandates.