The following excerpt is taken directly from the International Food Policy Research Institute’s Brochure:
[[Biofuel demand is increasing because of a combination of growing energy needs; rising oil costs; the pursuit of clean, renewable sources of energy; and the desire to boost farm incomes in developed countries. In turn, the need for crops—such as maize and sugarcane—to be used as feedstocks for biofuels has increased dramatically. That demand has had a significant and increasing impact on global food systems.
The effects of growing biofuel demand are interwoven with tightening grain markets, which reflect demographic shifts and improved diets. In developing countries, as populations grow and incomes rise, diet preferences are shifting from staple crops to higher-value products like meat and dairy. As a result, the demand for grain- and protein-based animal feed is soaring and competing with food needs. These changes have led to increasing pressures on global agricultural markets and higher food costs.
Poor people in both rural and urban areas are disproportionately vulnerable to these forces because they spend a large share of their incomes on food. Biofuels subsidies in developed countries tend to drive up food prices, thus reducing consumption and nutritional well-being for net buyers. The higher prices for commodities resulting from biofuel feedstock production can mean higher incomes for some farmers in developing countries and better agricultural wages for laborers, although the question of distribution among winners and losers remains. Another outcome for developing countries could be increased pressure on fragile natural resources on which poor farmers depend, potentially further degrading land and stressing limited water supplies.]]
For information on biofuel research or IFPRI, please visit their website http://www.ifpri.org/.