AUSTRALIAN scientists have made a biofuels breakthrough, turning waste products like paper and wood trimmings, crop residue and garden clippings into a stable "bio-crude".

If successfully commercialised, the process could massively reduce the amount of waste going into landfills and help the biofuels industry steer clear of the controversial food versus fuel debate. Most of the world's biofuel is made from food crops such as corn and sugar. Many oppose biofuels because they believe they will lead to higher food prices and hunger among the poor.

The great hope is second-generation technology that enables fuel to be made from waste material like the stalks and leaves of food crops.