Assumptions for a Potential Outlook Yields: Major crops continue w/ trend line Energy crops (6 to12 dt/acre) Farm practices: Increase use of no-till and reduced till Land: Use cropland only Baseline: Extended 2005 USDA Baseline Commodity Programs: as specified in 2005
Feedstock for Energy* * Does not include forest harvest
Land Use 2006, 2015, and 2020 Land Use 2006, 2015, and 2020 ( million acres ) Corn Soybeans Wheat Energy Crop Hay Other Cropland in Pasture
Tons Distribution of the Production of Cellulosic Materials, 2010
Tons Distribution of the Production of Cellulosic Materials, 2020
Changes in Net Returns and Government Payments (million $)
The Opportunities Agriculture can face a long period of sustain expansion in demand. Bio-energy feedstocks could be a new $12 billion industry (net returns). Great potential for rural development Savings in government payments of $6 to $50 billion.
Key Challenges Food Security Transformation of industrial livestock production Positive contribution to food security Environmental Sustainable feedstock production Protection of tropical forests Social Who will accrue the benefits of the “new ethanol industry”? What benefits for Rural America? What role for international trade?
Conclusions America’s agriculture can play a key role in energy supply without impacting food security An expanding Bioenergy industry could produce: Increased Farm Income Reduced Government Payments Increased Rural Economic Development Enhanced Environmental Benefits Reduction in Foreign Oil Dependency HOW this potential is pursued matters: social and environmental impacts
Agricultural Policy Analysis Center http://agpolicy.org/ Bio-based Energy Analysis Group http://beag.ag.utk.edu/ Department of Agricultural Economics, Institute of Agriculture University of Tennessee http://www.agriculture.utk.edu/