A U.N. agency on Tuesday called for an urgent review of agriculture and biofuel subsidies and trade barriers, saying their removal would increase opportunities for developing countries to take advantage of rising biofuel demand.

Imposing price controls and export bans prevents markets from adjusting and may prolong and deepen the food crisis, the Rome-based Food and Agriculture Organization said in a newly released report.

“Current policies tend to favor producers in some developed countries over producers in most developing countries,” FAO Director-General Jacques Diouf said. “The challenge is to reduce or manage the risks while sharing the opportunities more widely.”

Growing demand for biofuels, which are made from crops such as sugar cane and corn, will contribute to food prices increases, but can also promote rural development in poor countries _ provided that small farmers gain access to markets and receive support to boost their production.

The agency also said in its “The State of Food and Agriculture” yearly report that biofuels, although environmentally friendly, will not necessarily contribute as much as previously thought to reducing greenhouse gas emissions.

Their impact depends on how and where biofuels are produced and brought to the market, it said.

The U.N. has called on the international community to issue guidelines to ensure biofuel crops do not compete with food crops and do not encourage deforestation.

Biofuel production based on agricultural commodities, which more than tripled from 2000 to 2007, covers nearly 2 percent of the world’s consumption of transport fuels, the agency said.

Even though the growth is projected to continue, the contribution of liquid biofuels _ mostly ethanol and biodiesel _ to transport energy will remain limited, it said.

The Paris-based Organization for Economic Cooperation and Development has estimated that the United States, the European Union and Canada spent $14.8 billion in public money to support energy crops in 2006 _ and will more than double that over the next 10 years.