The Hague, Sept 3 - Enthusiasm for biofuels is receding and European legislators have become more sensitive to the needs of the food industry, hit by soaring commodities prices, the head of the Dutch brewers' association (CBK) says.
"I am not as afraid as last year that vast areas will be planted with rape seed, replacing grain crops," Jack Verhoek told Reuters in an interview on Tuesday. "I think wisdom has returned."
Lawmakers and scientists are warning of problems with large-scale planting of crops for first-generation biofuels, which have been blamed in part for high world food prices because of competition for farmland, Verhoek said.
"I think if this understanding continues to grow, then people will realise we shouldn't use land for growing fuel crops alone. We should use it first for grain," he said.
The CBK, which represents such brewers as Heineken, advocates a "second generation" of biofuel, which are produced from non-food crops.
First-generation biofuels usually are produced from food crops, including wheat, maize, sugar or vegetable oils.
Second-generation biofuels are made using new production methods that turn plant cellulose from non-food crops and waste biomass into ethanol or biodiesel.
Second-generation methods use much less energy and land, which supporters of the processes say ease competition for land.
"There are industries working very hard to find out the best way to gain from second-generation fuels. It has to do with fermentation and distillation techniques," Verhoek said.
"There is also at the moment a discussion on algae from the sea, which can produce kerosene, which is very promising."
Verhoek said Dutch beer brewers and other members of the food industry had appealed for more government funding for second-generation biofuels.
Rising grain prices have hit brewers' profits.
Heineken said last week that while it posted a 7.4 percent rise in operating profit in the first half of 2008, its raw materials and input costs rose 15 percent and it expected them to rise by 8 percent next year.