The effects of opportunity costs, supply chain logistics and carbon balances on advanced biofuel production

Aaron De Laporte and David Ripplinger

No 235852, 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts from Agricultural and Applied Economics Association

Abstract: Changes in crop prices have encouraged farmers to consider alternatives, such as potential advanced bioenergy feedstocks, including energy beets. This paper employs an integrated biophysical, economic and GIS-based transportation model to examine the supply of beet-bioethanol from five sites in North Daktoa. The study finds that beet bioethanol could provide net benefits to farmers and ethanol producers in the state, under current market conditions, but only if the bioethanol plant site is carefully selected. More specifically, a 20,000,000 gallon ethanol plant in Valley City could have net returns of $436,049. This plant would acquire 760,000 tons of beets from around the plant site and further east toward the Red River Valley from 22,682 acres of cropland an average distance of 15.7 miles away. The average yield of the selected cropland is 33.5 tons/ac with average net farm returns of $26.09/acre above opportunity costs. Opportunity and transportation costs can substantially change the attractiveness of croplands for beet production. The current market opportunity presented by beet bioethanol at $1.50/gal ethanol is not particularly attractive, but as ethanol prices increase, this opportunity could become attractive at a number of sites throughout the state.

Keywords: Agribusiness; Community/Rural/Urban Development; Crop Production/Industries; Farm Management; Industrial Organization; Production Economics (search for similar items in EconPapers)
Pages: 21
Date: 2016-08-01
New Economics Papers: this item is included in nep-ene, nep-env and nep-tre
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://ageconsearch.umn.edu/record/235852/files/A ... uel%20Production.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea16:235852

DOI: 10.22004/ag.econ.235852

Access Statistics for this paper

More papers in 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts from Agricultural and Applied Economics Association Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().