Title: Profitability of Cellulosic Biomass Production in the Northern Great Lakes Region

Abstract

Producing bioenergy feedstocks on non‐crop land can largely avoid the food price feedbacks of energy biomass production on cropland. The U.S. northern tier grassland‐to‐forest ecotone offers large areas of marginal land that is not currently cropped. In this ecological transition zone, the relative profitability of grassy vs. woody sources of energy biomass is little studied. This paper reports an exploratory investment analysis of cellulosic biomass production in the northern Great Lakes region. It compares two short‐rotation tree crops, willow ( Salix sachalinensis F. Schmidt)and hybrid poplar ( Populus nigra L. X P. maximowiczii A. Henry), and switchgrass ( Panicum virgatum L.) (a native prairie grass) to conventional mixed hay. Because biomass markets are not yet well developed, this study calculates threshold prices and yields at which biomass crops become at least as profitable as mixed grass hay. At 2010–2012 prices and available production technologies, none of the cellulosic crops is competitive with the hay baseline system. The breakeven price of energy biomass ranges from $90–100 per oven‐dry Mg ⁻¹ for all three energy crops. Breakeven yields are much more variable, due to the high cost of harvesting woody biomass. At 2010–2012 prices, necessary biomass yield increases range from 3.5‐fold formore » switchgrass and willow to over 25‐fold for poplar. While the ratio of input costs to revenue remains relatively constant between the northern and southern Great Lakes regions, the opportunity cost of active cropland in the southern zone is much higher, implying an economic comparative advantage for marginal land of the northern tier of the Great Lakes region.« less

Authors:

Kells, Bradley J. ^[1]; Swinton, Scott M. ^[2]

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+ Show Author Affiliations

1. Dep. of Economics George Mason Univ. Fairfax VA 22030
2. Dep. of Agricultural, Food and Resource Economics Michigan State Univ. East Lansing MI 48824

Publication Date:

Sat Mar 01 00:00:00 EST 2014

Sponsoring Org.:

USDOE

OSTI Identifier:

1787172

Grant/Contract Number:  

FC02-07ER64494

Resource Type:

Published Article

Journal Name:

Agronomy Journal

Additional Journal Information:

Journal Name: Agronomy Journal Journal Volume: 106 Journal Issue: 2; Journal ID: ISSN 0002-1962

Publisher:

Wiley Blackwell (John Wiley & Sons)

Country of Publication:

United States

Language:

English