The Effect of Agricultural and Energy Prices on Biomass Production: The Case of Triticale in the OECD Area

Abstract

Through the use of the econometric technique of panel data, this work mainly investigates the relationships between agricultural and energy prices and the land use for triticale, which is nowadays seen as one of the most important biomass crops. This is done with the aim of assessing the land use implications potentially associated to the existence of policies implementing forms of incentive for renewable energy production. The analysis is developed while considering 22 selected OECD countries observed over a period of 17 years, between 1995 and 2011. The analysis results suggest that the estimated functional shape of the land use for triticale mainly depends upon variations in the yield, producer and electricity prices. The policy implications, which might be derived from these findings, highlight how farmers would not be willing to substantially increase the area devoted to triticale unless the adoption of some forms of economic incentives to enhance bio-energy production is taken into consideration.