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Biomass and Agriculture

Sustainability, Markets and Policies

Biomass and Agriculture
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The 21st century could see the switch from the fossil fuel to the biological based economy. Agriculture could be rejuvenated as a source of bioenergy and biomaterials, as well as providing food and fibres. The relative costs of fossil fuels and agricultural biomass will clearly play a key role. Projected prices of fossil fuels over the next 30 to 50 years may ensure the dominance of the hydrocarbon economy. Even so, the price of bioplastics is competitive with petroleum based plastics at the top end of the market. Also, biofuels, such as ethanol are easier to exploit than fuel cells for their market potential.

There is growing interest by both governments and the private sector in expanding markets for energy and materials produced from agricultural biomass. But what is the contribution of agricultural biomass to sustainable development? What issues should be addressed by policies? What are governments actually doing and how effective are they?

The OECD Workshop on Biomass and Agriculture addressed these questions. It concluded that countries must take care in assessing the costs and benefits of promoting agricultural biomass production, to ensure that: it is economically efficient and profitable for farmers by responding to market needs; it is environmentally effective; and it can meet broader policy goals for agriculture, energy, industry, social welfare, trade and sustainable development.

The Workshop also concluded that the policy strategy for biomass needs to focus on demand rather than supply, with a switch in emphasis from using agricultural policies to other policy tools and market approaches. Policies should be targeted at reducing set-up costs, encouraging innovation, reducing technology costs, and providing large-scale test facilities, etc, to avoid simply closing the gap between production cost and market price. A clear communication strategy is also needed for technology and feedstock providers and potential users, and to improve public awareness and understanding of the biomass sector.

Organisation for Economic Co-operation and Development; January 2004
570 pages; ISBN 9789264105546
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