European biofuel targets should be scrapped unless second generation sources of biofuel that don't take land away from food production can meet demand, according to the Food and Drink Federation (FDF).
Trade policy manager Caroline Fox said: "It had been decided that the targets [that 10% of road transport fuel in the EU should come from biofuel by 2020] would only be adopted if biofuels were sustainably produced and cost effective. At the moment, neither appears to be the case, and yet we seem to be moving ahead regardless."
Impact assessments did not properly account for the effect the target could have on food prices as more crops were diverted into fuel production, she added.
While many people agreed that the long-term solution lay in second generation biofuels from waste materials and non-food sources, these were not yet widely available, she said. "Second generation biofuels will not come onstream until 2014 or 2015. In the meantime, what will happen to the food industry?"
The government was "on our side", she added, as Prime Minister Gordon Brown confirmed that Britain would push for changes in the 10% target if a review launched in February revealed that biofuels were driving up food prices and harming the environment.
He also called for research into higher-yielding crop varieties that could withstand harsher climates after the UN World Food Programme said urgent action was required to help the poor cope with soaring food prices.
The FDF's comments came as Associated British Foods said that the cost of commodities such as corn, soy and canola oils had "more than doubled over the year", denting profits of its edible oils division.