Biofuel Use and Rising Food Prices: Will Demand Continue?

Biofuel demand can influence food prices because several fuel feedstocks are also important food or feed commodities.

Vegetable oils such as palm oil, soybean oil and rapeseed oil are used in biodiesel, while sugarcane and corn are used in ethanol. When fuel demand increases, competition for these raw materials can place pressure on food supply chains.

Energy policies and environmental rules may keep demand for biofuels strong, but analysts warn that markets need balance between fuel needs and affordable food supplies.

Source: Food Navigator