Economics

On Farm Production of Biodiesel - Economics

MSU Extension is working with farmers to develop a "field to fuel tank" system where farmers can grow an oilseed crop and convert it to biodiesel for use in farm equipment. This is a small scale system that is capable of producing 6000 gallons of fuel per year and can be scaled based on farm size and fuel needs. Economics of this system are difficult to state as each farm situation is different. However, an Excel spreadsheet has been developed to help provide a framework for you to plug your data into and calculate your cost of production. Follow the link below to download the Excel file:

On Farm Biodiesel Economics Tool (xls file)

The following content is taken directly from MSU Extension Bulletin E-3084, "Profitability of Converting to Biofuel Crops." This bulletin provides a comparison of bioenergy crops with a contender crop like corn. The economics question is framed to ask the farmer "what yield" or "what price" would a bioenergy crop need to achieve in order to compete with corn for profit potential. A printed copy of the bulletin can be purchased from the MSU Extension Bookstore.

Bioenergy Crop Budgets

Corn + stover	XLS	PDF
Switchgrass	XLS	PDF
Miscanthus	XLS	PDF
Miscanthus (cheap rhizomes)	XLS	PDF
Native Prairie	XLS	PDF
Grass Mix + Clover	XLS	PDF
Hybrid Poplar Trees	XLS	PDF

Source: James, L.K., S.M. Swinton and K.D. Thelen. “Profitability Analysis of Cellulosic Energy Crops Compared to Corn.” Agronomy Journal (forthcoming in 2010).