Potential of biofuels for reducing poverty

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  • 1. Potential of biofuels for reducing poverty 29 April 2009 FAO, Rome Vineet Raswant
  • 2. Agenda
    • Part 1: Why are biofuels important for the rural poor?
    • Part 2: Addressing the climate change mitigation agenda
    • Part 3: Biofuels and food security
    • Part 4: Biofuels and water
    • Part 5: Biofuels and biodiversity
  • 3. Why are biofuels important for the rural poor?
  • 4. Why are biofuels important for the rural poor?
    • 1 out of 5 people are engaged in Agriculture.
    • Yet Agriculture only contributes to 4% of Global GDP.
    • Not surprising that poverty is largely in the agricultural sector.
  • 5. Why are biofuels important for the rural poor?
    • If these people stay in agriculture, they face many problems.
      • Commodity prices kept declining up to 2006.
      • Input costs have been going up.
      • Agriculture is unprofitable for many.
      • With declining land holdings the problems of smallholder farmers could be even worse.
  • 6. Why are biofuels important for the rural poor?
    • Option 1: Improve farm-gate prices .
  • 7. Why are biofuels important for the rural poor?
    • Option 2: Take these people out of agriculture - as advocated by a number of economists.
      • Can they be absorbed in other sectors in developing countries, when most are agriculture-dependent economies?
  • 8. Why are biofuels important for the rural poor?
    • There is a need to expand the size of the agricultural basket (as presently defined food, feed, and fibre) to employ such a large number of poor.
    • Biofuels have the potential to generate employment in rural areas, and trigger agricultural growth with implications for poverty reduction.
    • Cross-country econometric evidence indicates that GDP growth generated in agriculture is at least twice as effective in reducing poverty as growth generated by other sectors (World Bank, 2007).
  • 9. Addressing the climate change mitigation agenda
  • 10. Alternative Biofuel Crops
    • Partly due to a current knowledge gap, experiences with food crops, which have unfortunately been used for biofuel production, are dictating perceptions about biofuels.
    Should policies be dictated by such practices or lack of knowledge?
  • 11. Alternative Biofuel Crops
    • Jatropha, Pongamia, Cassava, Sweet sorghum:
      • require less water,
      • can be grown in relatively unfavourable agro-climatic conditions,
      • can reduce greenhouse gas emissions.
    • Tropical sugarbeet, Seashore mallow, Camelina, Arundo donax can be grown in saline conditions.
    • There are about 60 million ha of land affected by secondary salinization, that – once R&D is conducted - can be used for biofuel production.
  • 12. Biofuels and GHG savings Why not develop a cut-off point, such as ‘any reduction less than 40% is not acceptable’? 60% to 120% Next generation crops 53% to 78% Soybean 31% to 90% Palm oil -47% to +58% Maize Average Reduction Crops
  • 13. Biofuels and food security
  • 14. Biofuels and food security
    • As experienced recently, food prices increased dramatically with maize and other food crops being introduced as feedstock, affecting many poor households.
    • However, the medium-longer term implications of sustained increase in food prices can lead to higher production. (SOFA 2008, FAO)
    • Food production can also be increased through improved yields, and cultivating additional lands.
    • Land potentially available for expanded crop production is between 250-800 million Ha. (SOFA 2008, FAO)
  • 15. Biofuels and food security
    • Available analysis indicated that in general bio-fuels are not a primary cause of hunger, nor a direct driver of food insecurity (GEF-STAP Workshop on Liquid Biofuels, 2006).
    • Bio-energy crops could be a means to alleviate poverty, and to increase food security through income generation.
    • Food security is not just a problem of production, rather a problem of unequal access within developing countries (FAO 2005).
    • Supply of energy in rural areas is central to intensification of agriculture.
    This has become a pressing issue only because some countries have used food crops for biofuels production. Solution: Do not use food crops for bio-fuel production, or promote multiple use crops.
  • 16. Biofuels and water
  • 17. Biofuels and water
    • Intensive cultivation of monoculture cash crops causes environmental externalities associated with:
      • Pesticides, fertilizers, high water use (which lead to water pollution and depleted resources).
    • Small scale farming production has lesser environmental impacts.
    Why not promote smallholder biofuel crop production using CA techniques?
  • 18. Biofuels and biodiversity
  • 19. Biofuels and biodiversity
    • Deforestation has been occurring because of lack of opportunities, before the demand for biofuels increased.
    • Despite the fact that biofuels might have accelerated the trend in some areas, it should not be considered the key driver for deforestation.
    • World population is expected to rise from 6.77 billion to about 9 billion by 2040, mostly in developing countries. How are these people meant to earn their income?
    Why not promote production of suitable crops in dry marginal lands in anticipation of these trends?
  • 20. Conclusion
  • 21. Conclusion
    • Biofuels should be treated like any other cash crop.
    • Impacts could be minimized by preferring crop varieties and farming techniques which cause low or positive impacts.
    • A more balanced and a clear view on biofuels needs to be disseminated.
  • 22. Thank you for your Attention