Can India meet biofuel policy targets? Implications for food and fuel prices

The article focuses on the implications for food and fuel prices, examining whether India can meet biofuel policy targets. Sugarcane and molasses, a byproduct of sugar production, are the feedstocks currently available for ethanol production. The cost-effective mix of these feedstocks will depend on several factors, including the demand for sugar, alcohol and other crops, the value of molasses and sugarcane in alternative uses, the ease with which land can be converted across uses and the costs and efficiency of converting molasses and sugarcane to ethanol. Cultivated land area under each of the crop categories, foodgrains, oilseeds, and sugarcane, has not shown any significant change since 1990 although there are some annual fluctuations in land area planted to specific crops in response to crop prices. The simulation model utilizes state-level data on acreage, yields, production costs, and water availability for 15 of the most productive agricultural states in India.