As China prepares for a .18% decrease or usuable farmland per year and an increased need for grain, what will happen in the US?

The population of the planet is increasing rapidly and the amount of "prime" real estate is being devoured by condos and homes. We are in a head-on collision with the problems that China is currently facing.

The shortfall in grain output is not as simple as it seems. the demand for grain is increasing with the size of the population and the size of the population has an effect on viable farm land.

My question is simple and maybe we have some citizen botonist/agriculture experts who can answer it.

The question:

With an increased demand for agricultural foodstuffs, and (for the sake of the argument) shrinking availability of good farm land, how does increased demand of biodiesel impact the resources of a nation such as the US?

While I am all for alternative forms of energy, doesn't this spell potential disaster in a warming climate, when valuable resources will be diverted for growing fuel?

On the other hand, can crops serve as a carbon dioxide sink, or do the plants have to remain planted to be beneficial?

Please chime in... I am curious.

-Bryan