The International Energy Agency (IEA) estimates that renewable energy sources account for about 13% of the world’s total primary energy supply. Nearly 80% of these renewables are in the form of combustible biomass—mostly wood, charcoal, crop residues, or other wastes burned for cooking, heating, and other activities in the developing world.
Now, high oil prices and the need to reduce dependency on fossil fuels (and thus also offset greenhouse gas emissions) are driving rapid commercialization of solid, liquid, and gaseous biofuels. For example, within the next 5 years, most of the maize produced in the U.S. states of Iowa and Nebraska is likely to be used in ethanol production. The overall share of maize used in the U.S. for ethanol is projected to increase from the current 10% to 25% by 2010.
China, the world’s third-largest ethanol producer, also emerged as an ethanol exporter in 2006. Pioneer Hi-Bred is investing in developing “ethanol” corn hybrids for the Philippines. Indonesia hopes to see biofuel account for 10% of its fuel consumption by 2010 and has earmarked US$1.4 billion for 2007 to develop 500,000 hectares of land for biofuel production.
Is this just a short-lived gold rush driven by high oil prices and large profit margins, or is this an industry here to stay? What implications will this have for world cereal production and how does rice fit into this picture?
A crude calculation illustrates some of the issues we face. At present, average world cereal yield is about 3.1 tons per hectare. If the world cereal harvest area remains unchanged, this average yield needs to increase to 4.3 tons per hectare by 2025 to meet the expected cereal demand of the growing world population. Factor in an extra 5% grain converted into ethanol, and the figure rises to 4.5 tons per hectare. This represents a 45% increase over current yields and, unless nitrogen fertilizer use becomes more efficient, it would come at the cost of a 65% increase in nitrogen consumption on cereal land. If the decline in world cereal area observed in the past 20 years (a reduction of 0.3% per year) continues, the situation becomes much worse, requiring an average cereal yield of nearly 4.9 tons per hectare by 2025.
Keeping the rice price low for the urban and rural landless poor in Asia has been a primary achievement of the higher yields that came out of the Asian Green Revolution, and it remains a key development target. World rice prices have already doubled in the past 5 years (48% in the past year alone) and are projected to rise further. Although most rice consumers in Asia, where most rice is locally consumed, are shielded from the world market price, the emerging biofuels industry will probably add to price pressure on cereals, including rice. Rice grain is not likely to be diverted into ethanol production in significant amounts but some rice may be diverted to produce starch (for industrial use) to make up for deficits arising from the conversion of other crops to ethanol.
Another potential threat is that rice farmers may opt out of rice and diversify toward more profitable cropping systems, including potential biofuel crops such as maize, sugarcane, or cassava. So, maintaining low rice prices and lifting the income potential of rice farmers seem contradictory goals in a world of rising input costs in agriculture.
Renewable energy options must satisfy three conditions: resource availability, technical maturity, and a policy and economic environment that supports commercialization. The nearly 600 million tons of rice straw produced each year worldwide represent such an exploitable biofuel resource. However, many of the technologies that allow rice straw to be converted to ethanol are still at an early stage of development. It remains to be seen whether they can be scaled down to village-level, on-site bioenergy production and how much straw can be removed from rice land without threatening soil fertility and the overall productivity of the system. There is also much potential for developing technologies for producing a variety of rice-based products, including ethanol, fibers, and biochar (used for soil improvement).
Growing food crops to also provide fuel for our cars or homes is something many agricultural researchers will need to get used to. Now is the time to address this and develop suitable technologies for integrated food and bioenergy production systems in Asia that are energy-efficient and sustainable, provide new employment opportunities for the rural population, and also offer new sources of income for rice farmers.
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Dr. Dobermann is a professor of soil science and nutrient management at the University of Nebraska, USA.
