IDEAS home Printed from
   My bibliography  Save this paper

Greenhouse Gas and Nitrogen Fertilizer Scenarios for U.S. Agriculture and Global Biofuels



This analysis uses the 2011 FAPRI-CARD (Food and Agricultural Policy Research Institute–Center for Agricultural and Rural Development) baseline to evaluate the impact of four alternative scenarios on U.S. and world agricultural markets, as well as on world fertilizer use and world agricultural greenhouse gas emissions. A key assumption in the 2011 baseline is that ethanol support policies disappear in 2012. The baseline also assumes that existing biofuel mandates remain in place and are binding. Two of the scenarios are adverse supply shocks, the first being a 10% increase in the price of nitrogen fertilizer in the United States, and the second, a reversion of cropland into forestland. The third scenario examines how lower energy prices would impact world agriculture. The fourth scenario reintroduces biofuel tax credits and duties. Given that the baseline excludes these policies, the fourth scenario is an attempt to understand the impact of these policies under the market conditions that prevail in early 2011. A key to understanding the results of this fourth scenario is that in the absence of tax credits and duties, the mandate drives biofuel use. Therefore, when the tax credits and duties are reintroduced, the impacts are relatively small. In general, the results show that the entire international commodity market system is remarkably robust with respect to policy changes in one country or in one sector. The policy implication is that domestic policy changes implemented by a large agricultural producer like the United States can have fairly significant impacts on the aggregate world commodity markets. A second point that emerges from the results is that the law of unintended consequences is at work in world agriculture. For example, a U.S. nitrogen tax that might presumably be motivated for environmental benefit results in an increase in world greenhouse gas emissions. A similar situation occurs in the afforestation scenario in which crop production shifts from high-yielding land in the United States to low-yielding land and probably native vegetation in the rest of the world, resulting in an unintended increase in global greenhouse gas emissions.

Suggested Citation

  • Amani Elobeid & Miguel Carriquiry & Jacinto F. Fabiosa & Kranti Mulik & Dermot J. Hayes & Bruce A. Babcock & Jerome Dumortier & Francisco Rosas, 2011. "Greenhouse Gas and Nitrogen Fertilizer Scenarios for U.S. Agriculture and Global Biofuels," Center for Agricultural and Rural Development (CARD) Publications 11-wp524, Center for Agricultural and Rural Development (CARD) at Iowa State University.
  • Handle: RePEc:ias:cpaper:11-wp524

    Download full text from publisher

    File URL:
    File Function: Full Text
    Download Restriction: no

    File URL:
    File Function: Online Synopsis
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    1. Babcock, Bruce A., 1992. "Effects of Uncertainty on Optimal Nitrogen Applications (The)," Staff General Research Papers Archive 10588, Iowa State University, Department of Economics.
    Full references (including those not matched with items on IDEAS)


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Wise, Marshall & Dooley, James & Luckow, Patrick & Calvin, Katherine & Kyle, Page, 2014. "Agriculture, land use, energy and carbon emission impacts of global biofuel mandates to mid-century," Applied Energy, Elsevier, vol. 114(C), pages 763-773.
    2. Sohngen, Brent & King, Kevin W. & Howard, Gregory & Newton, John & Forster, D. Lynn, 2015. "Nutrient prices and concentrations in Midwestern agricultural watersheds," Ecological Economics, Elsevier, vol. 112(C), pages 141-149.
    3. Miguel Carriquiry & Amani Elobeid & Ryan Goodrich, 2016. "Comparing the trends and strength of determinants to deforestation in the Brazilian Amazon in consideration of biofuel policies in Brazil and the United States," Documentos de Trabajo (working papers) 16-12, Instituto de Economía - IECON.

    More about this item


    afforestation; energy price; ethanol tax credit; fertilizer; partial equilibrium model; policy analysis.;

    NEP fields

    This paper has been announced in the following NEP Reports:


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ias:cpaper:11-wp524. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.