Analysis of Land-Use Impacts from Increased Biofuels Production in the EU

A report from the Center for Agricultural and Rural Development (CARD), Iowa State University (United States), shows an analysis of the world market impacts of higher biofuel use in the European Union (EU). The study was commissioned by German Marshall Fund of the United States (GMF) and the European Commission's Joint Research Centre–Institute for Energy (EU-JRC). The analysis focused on land-use impacts, and was carried out with the use of an international modeling structure called the FAPRI (Food and Agricultural Policy Research Institute) Model, or the CARD Model (if Iowa State University uses the modeling system on its own). Two scenarios reflecting high biofuel use in the EU were run using the model: (1) high wheat ethanol use, and (2) high rapeseed biofuel use. The report gives an overview of the method as follows "After each shock in the respective scenario was introduced, the whole system of models was solved to arrive at a new equilibrium. And the impacts of the scenarios were measured in terms of departures of endogenous variables of interest from their baseline level". Among the highlights of the analysis results are: (1) an increase of 1 million tonnes oil equivalent (Mtoe) of wheat ethanol use in the European Union expands world land area used in agricultural commodity production by 366,000 hectares, representing an increase of 0.039% in total area (2) an increase of 1 Mtoe of rapeseed oil biodiesel use in the European Union expands world land area by 352,000 hectares, representing an increase of 0.038% in total area; (3) when wheat use for ethanol production expands, most of the adjustment is met within the European Union, with only a 9% reduction in net exports required; (4) about 57% of additional rapeseed oil used for expanded biodiesel production is supplied from higher imports, allowing substantial adjustment by countries outside of the European Union. The complete report can be accessed from the CARD website (URL above).

Related information: FAPRI Models http://www.fapri.iastate.edu/models/