The Impact of COVID-19 Pandemic on Agri-Food and Biofuel Sector in the EU
The Impact of COVID-19 Pandemic on Agri-Food and Biofuel Sector in the EU

Author(s): Zuzana Kapustova, Mária Urbánová, Izabela Adamičkova, Peter Bielik
Subject(s): Social Sciences
Published by: Udruženje ekonomista i menadžera Balkana
Keywords: Biofuels; COVID-19; Food; Prices; Sustainability
Summary/Abstract: Biofuels refer to sustainable alternatives derived from biomass to replace fossil fuels, contributing significantly to reducing carbon dioxide emissions. However, the biofuel and food price debate is a long-standing, controversial one, with wide-ranging views, both in the public debate and in the scientific literature. The major problem of preferred feedstocks for the 1st generation biofuel production is that these feedstocks are also used for food and feed production. Moreover, there is persistent concern that biofuels compete with food production and that increasing biofuels prices lead to an increase in agricultural commodity prices. The lockdowns as a consequence of the COVID-19 pandemic hit the biofuel sector and reduced demand for all transport modes as energy demand around the world has decreased by 18 – 25%. Lower demand for biofuels affects the demand for its feedstocks, maize and oilseeds, which, in turn, affect the markets for other crops and animal products. The paper intends to provide an expert perspective on the issue of the consequences of the COVID-19 pandemic on agri-food and biofuel sector in the EU –the world leader in the production and use of biodiesel for transport. More specifically, the linkages between the first-generation biofuels and agri-food commodity prices will be examined using co-integration analysis and VECM-type models.

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