Both are grammatical and the choice would depend on the context. Without context, I would choose could . The relative clause would then mean that it would have been possible to use the land to grow food plants; now it is being used to grow plants for biofuel.
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New2grammarwhich would/could have been used to grow food plantsEither one. The analogous ideas are will and can. Use the one that conveys the meaning you want to convey.