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The government supports the development of biofuel but not from grain, a senior agriculture planning official said yesterday.

The Ministry of Agriculture is piloting production of biofuel derived from non-grain crops, but has no plans to expand acreage of corn a major raw material for biofuel next year.

It was the first time the ministry has explicitly stated its policy on production of biofuel, whose surging demand has contributed to recent price hikes in the food market.

"We have a principle with regard to biofuel: it should neither be at the cost of foodgrains for people's consumption nor should it compete with grain crops for cultivated land," Yang Jian, director of the ministry's development planning department, told China Daily.

Yang made it clear that his ministry did not support using corn, or any other grain crops, as raw material to produce biofuel.

"There is a growing demand for corn, especially for feeding livestock," he said.

In addition to being used as food, 72 per cent of China's corn yield is used in animal feed; if the crop is used for other purposes, the sector will be affected, he said.

But since biofuel can help raise farmers' income and quench the thirst for cleaner energy, the ministry encourages them to grow sorghum, cassava and other non-grain crops on slopes and patches that are unfit for grain production, he said.

Biofuel is fuel such as ethanol and methane produced from renewable biological resources. In China, corn contributes around three-fourths of the raw material for making ethanol, whose output is estimated at 1.3 million tons this year. Last year, the country used 48 million tons of gasoline.

The country plans to substantially raise the share of ethanol and other cleaner-burning substitutes during the 11th Five-Year Plan (2006-10), according to sources with the National Development and Reform Commission.

The ministry has designated some acreage in East China's Shandong Province and Northwest China's Xinjiang Uygur Autonomous Region to produce sweet sorghum this year for the making of biofuel, Yang said.

"They are producing biofuel on a small scale and on a trial basis," he said, adding the ministry has also approved projects to develop fine seeds of other non-grain strains to feed biofuel production.

Wang Xiaobing, an official with the ministry's crops cultivation department, said developing biofuel is a global trend; it helps expand the space for agricultural development.

"In China, the first thing is to provide food for its 1.3 billion people, and after that, we will support biofuel production."

Poor harvests in key producing countries and a fast-growing demand for biofuel production have driven up global grain prices, the Food and Agriculture Organization said in its latest Food Outlook report.

Both Yang and Wang confirmed China's grain output is expected to exceed 490 million tons this year, the third consecutive bumper harvest. Last year, the output was 484 million tons.

"The central government has continued its robust support for the agricultural sector this year, which has helped farmers focus on grain production," Wang said.

Despite being continuously encroached upon by development in many regions, the country's grain-producing farmland has been expanded by 1.06 million hectares to 105.3 million hectares this year, thanks to efforts to reclaim idle farmland and increase multiple cropping, he said.

Yang said he hoped the recent price surges in the food market do not send wrong signals to local government officials, who may think farmers would automatically increase grain production area.

"Compared with cash crops, the returns from grain production are low," Yang said. "Therefore, we should never relax our efforts to focus on grain production by ensuring there is enough acreage and improving per-unit output."

Arable land shrunk by 8 million hectares between 1999 and 2005, and the ministry predicted that through 2010, the total grain-producing land area will decrease by 0.18 per cent annually.

(China Daily 12/18/2006 page1)