Biofuel demand to consume 27% of global cereals by 2034: OECD-FAO report

By 2034, only 40 per cent of the world’s cereal production will be consumed directly by humans, while a growing share — 27 per cent — will be diverted to biofuel and industrial uses, according to the latest OECD-FAO Agricultural Outlook 2025-2034.

Public policy forum Organisation for Economic Co-operation and Development (OECD) and Food and Agriculture Organization of the United Nations (FAO) released the 21st edition of the report on July 15, 2025. It marks a significant revision from last year’s forecast, which had estimated that biofuels and other industrial applications would account for just 23 per cent of cereal use by 2033. Animal feed will account for the remaining 33 per cent of cereal utilisation by 2034.

The findings underscored the intensifying competition between food, feed and fuel sectors for key agricultural feedstocks, especially as global biofuel demand accelerates—driven primarily by emerging economies. Biofuel demand is now expected to grow at an average rate of 0.9 per cent per year through 2034, up from the previous projection of 0.6 per cent.

India, alongside Brazil and Indonesia, is expected to lead this acceleration.

Despite global concerns over the sustainability of biofuel production, the industry is projected to continue relying heavily on food-based feedstocks,, the report pointed out. 

“While cellulosic feedstocks — such as crop residues, dedicated energy crops or woody biomass — offer promising alternatives that avoid competition with food sources, these advanced feedstocks are not expected to experience a substantial increase in their share of total biofuel production,” it said. 

Slower growth in farmland, but yield gains continue

Global cereal production is projected to grow by 1.1 per cent annually over the next decade, mostly due to a 0.9 per cent increase in yields. Expansion of harvested area will slow to just 0.14 per cent annually — less than half the rate seen over the previous decade (0.33 per cent), the report estimated.

India and Southeast Asian nations are expected to contribute 39 per cent of global cereal consumption growth by 2034, up from 32 per cent over the past decade. China’s share, by contrast, will decline to 13 per cent from 32 per cent, reflecting broader shifts in consumption patterns.

Surge in demand for animal-based food

The report also highlighted rising global demand for animal-source foods, especially in middle-income nations where dietary preferences are shifting towards higher protein intake due to income growth.

Total agricultural and fish production is forecast to rise by 14 per cent by 2034, largely due to productivity improvements in these countries. However, this will also lead to increased environmental pressures: The expansion of animal herds and croplands is expected to raise direct agricultural greenhouse gas (GHG) emissions by 6 per cent. Notably, the carbon intensity of on-farm emissions is projected to decline over the same period, the OECD-FAO report said.

Production of meat, dairy and eggs is set to increase by 17 per cent, with global livestock inventories expanding by 7 per cent.

Per capita daily calorie intake from animal and fish products is forecast to grow 6 per cent globally over the next decade, with lower-middle-income countries seeing a dramatic 24 per cent rise, nearly four times the global average. By 2034, average intake in these countries is expected to reach 364 kilocalories per day, a sign of improving nutritional access.

However, stark inequalities persist. In low-income countries, per capita daily intake from animal products will remain at just 143 kilocalories—far below the 300 kcal benchmark used by the FAO to gauge affordability of a healthy diet.