Japan will study turning inedible crops such as straw into biofuel to run cars amid concern that the growing popularity of ethanol is inflating food prices, an official said Friday. Biofuels are seen as alternative clean energy resource which can reduce the dependence on Middle Eastern oil and lessen the impact on global warming.

One biofuel, ethanol, is derived from sugar beets, wheat, corn or sugarcane, leading to concern that reliance on it will push up food prices.

Japan's Ministry of Agriculture, Forestry and Fisheries will seek a budget of several million dollars to demonstrate that biofuel can be made from rice straw and chaff.

"We already have the technology to make ethanol from straw and chaff, but we've only succeeded at the laboratory level," said Eiichiro Kitamura, the official in charge of the project.

"What we are trying to do is to collect straw and chaff on a relatively large scale in a local community to make biofuel and then use it for the first time for vehicles and other uses," he told AFP.

Through the experiment, the ministry will also aim to gather information on whether it is economically effective to make biofuel from inedible crops, he said.

Rising world reliance on biofuels over the next decade threatens to drive up food prices in poor countries, where they are already facing upward pressure from consumer demand, a joint report by the Food and Agricultural Organisation and the Organisation for Economic Cooperation and Development said last month.

"If we can use biofuels from inedible parts of crops, then markets for biofuels and markets for foods would not have to compete," Kitamura said.

The budget request will be submitted to the Ministry of Finance for the next fiscal year starting April, and the final budgetary plan will need to be approved by parliament later in the current fiscal year.