Worldwide agricultural commodity prices have soared this year as food and biofuel producers compete to secure supplies of corn, rapeseed, sugar beet and other edible crops.

Biofuels have already been blamed for rising tortilla prices in Mexico, where the government last week froze prices in an attempt to restrain inflation.

According to Bioverda's chief executive, John Mullins, the company believes it could produce biodiesel from japtropha within five years.

"The idea is that japtropha is grown in developing countries, crushed there so you get the oil and then we'd bring it to our plants in Cork or Teeside, " he said. "You then blend it with vegetable oil and convert it into biodiesel."

Mullins said that although adopting japtropha was a long-term project, Bioverda's determination to do it was evident in its recent appointment of Nick Brooks as its European chief executive.

Brooks was previously chief executive of British firm Sun Biofuels, which has concentrated heavily on developing japtropha plantations and processing infrastructure in Africa.

Mullins said, however, that Bioverda would not acquire its own plantations but would seek partnerships with plantation owners.

"We would invest in the crushing infrastructure to produce the oil but you have to remember that we're not farmers, we're industrialists, " he said.

He denied that Bioverda's decision to embrace japtropha reflected a concern that biofuels were driving up world food and crop prices.

"Drought and harvest issues are what are driving prices, " said Mullins. "There's a massive shortage of feed [for livestock] at the moment because of drought in Australia and the bad European summer. Biofuels shouldn't be kicked about as a football in all this."

The Irish Farmers Association (IFA), which has expressed concern about the effects that the biofuels boom could have on feed prices, has said it welcomes Bioverda's move.

The IFA's bioenergy project team leader, JJ Kavanagh, said the bioenergy field represented "a real opportunity for increased confidence and investment in agriculture and the rural economy while simultaneously addressing environmental and sustainability issues".

He said the IFA shared Bioverda's assessment of the reasons for high crop prices.

"While there is a lot of hype around the effect biofuel production is having on prices, this is only minor factor as weather and economics are the major contributing factors."