The ultimate aim of Ghent Bio-energy valley is to promote the development of the so-called knowledge-based bio-economy. As fossil resources are becoming depleted and increasingly expensive, the transition from the present fossil-based economy to the bio-based economy has already begun and the production of biofuels from renewable resources (biomass) is already having a major impact on the energy sector. Currently, bio-energy accounts for about 70 % of all renewable forms of energy, in addition to solar, wind and hydraulic energy that constitute the other 30 % of renewable energy.
Currently, most organic chemical substances produced in Europe and our energy needs are largely met by fossil resources such as coal, petroleum and natural gas. This is mainly a consequence of the very low prices for fossil resources in the past. However, the world's fossil reserves will not last forever. Particularly, the increasing demand for crude oil (petroleum) from a growing world population is now faced with a stagnating production rate. Even when the "proven oil reserves" have remained at about the same level since thirty years as a consequence of new oil findings, these oil reserves are increasingly located in difficult to reach places. Therefore, the costs for extracting the crude oil rises continuously, as reflected in increasing oil prices. Because of that strong dependence, future shortages and cost increase of fossil resources threaten to impact the very base of our society.
Furthermore, the use of these fossil resources is the major source of greenhouse gas emissions, with long-term effects that may change our climate. As a consequence of the increased concentration of the so-called greenhouse gases in the atmosphere, the earth is expected to become warmer on a global scale. The main contributor is CO 2 , primarily resulting from burning fossil resources such as coal, petroleum and natural gas. The use of renewable resources on the contrary is CO 2 -neutral in principle : the CO 2 that is emitted by burning biofuels has been fixed by the plants during their growth. In the Kyoto treaty, most European member states have pledged to undertake efforts to reduce their greenhouse gas emissions. The trading of CO 2 emission rights is now a fact. The first penalties for exceeding the norms will soon become effective. This is expected to result in a fundamental change in perception of the use of raw materials and energy consumption. It is clear that within the framework of respecting the Kyoto agreements, the use of renewable resources and energy should be promoted along with other measures such as increasing energy efficiency.
In sharp contrast to this, locally produced agricultural raw materials such as wheat and corn are becoming ever cheaper as a fundamental consequence of the rising agricultural yields, gradually tipping the economic balance towards the use of renewable resources. This trend will most likely continue for some time. Agricultural by-products such as straw are presently ten times less expensive than petroleum. Renewable resources thus offer excellent perspectives as a raw material for both our chemical needs and our energy needs (biofuels), for reasons of cost, European self-sufficiency, sustainable development and the conservation of natural resources. We can no longer bet our future wealth and prosperity on a resource that will be depleted in 50 years and will have become prohibitively expensive long before that. Whether we want to or not, change will be forced upon us. The transition of an economy based on finite fossil resources to a sustainable bio-based economy based on renewable resources is as inevitable as it is desirable.
European agriculture is likely to be seriously affected by these developments, as it supplies the main raw materials for bio-based products. Whereas European agriculture at present nearly exclusively serves the food and feed markets, non-food applications will absorb an increasing percentage of agricultural commodities such as corn, wheat, rapeseed, sugar, etc., having a serious impact on the supply and demand of agricultural commodities.
Oversupply and the resulting low prices for agricultural commodities are one of the main problems of European agriculture, mainly caused by an interplay of the following factors :
In the past, the European Community has dealt with overproduction through various measures, such as subsidized set aside land, export subsidies, etc., approaches that will likely not be sufficient or able to cope with the problem. It is clear that the Common Agricultural Policy will have to adapt continuously to new needs and problems, under the pressure of European farmers, consumers, governments as well as non-European partners, particularly the USA and developing countries. Industrial Biotechnology and the use of renewable resources for the production of chemicals and energy has the potential to create entirely new large-scale markets for agricultural commodities, absorbing the increasing agricultural production in Europe. Thus, the development of biofuels may provide considerably support for the European agricultural sector by creating demand for its products. It is clear that European farmers as well as rural development will benefit from this development, particularly in the new member states with their huge agricultural population. It is not unrealistic to hope that the creation of new market pull for agricultural commodities may lead to the reduction or abolishment of farmers' subsidies altogether, such that European agriculture may become a sector in which normal market mechanisms apply.