Microeconomic evaluation of biofuel production from Jatropha curcas

Jatropha (Jatropha curcas) is a wild plant that has captured the attention of investors, social organizations and public institutions as a biodiesel feedstock, under the assumption that it could reduce greenhouse emissions, increase energy sovereignty and boost socioeconomic development in producing countries. Contrary to other biofuel feedstock, jatropha is a non-edible plant able to grow in marginal lands and thus it was believed represent no competition for food production and natural resources. Under these premises, jatropha plantations have rapidly expanded around the world. However, after the implementation of large amounts of jatropha projects, concerns have raised about their real sustainability. Most jatropha investments and promotion policy decisions have been taken without enough technical and scientific knowledge regarding productivity and profitability. It is thus possible that some jatropha initiatives could have negative socio-economic impacts.

This study aims at assessing the impact that jatropha cultivation programs have on rural economies. To this end, I first analyzed the political and social context of different promotion programs, emphasizing on the main drawbacks encountered by farmers. I then analyzed the adoption dynamics of jatropha by looking at the role that subsidies provided by bioenergy policies have on enhancing rural development and at how well these incentives arrive to the targeted population. I also investigated the factors influencing farmers’ decision to disadopt jatropha cultivation. Finally, I assessed the economic profitability of jatropha cultivation. This study is based on case studies from Mali and Mexico. Data have been gathered by means of semi-structured interviews with key stakeholders, focus groups discussions and household surveys.

Results of this study show that jatropha promotion programs have been unsuccessful for farmers in our study sites, mainly due to problems related to the underperformance of the crop, low seed prices and unsecured market. Additionally, the incentives provided by the promotion program did not reached the targeted population, as they were distributed among the better off farmers. Failure to receive the expected subsidy introduced distrust on the program, and often led to the abandonment of jatropha cultivation. Results also show that current jatropha profitability in Mexico is determined by the opportunity costs of land and labour. When these costs are considered, jatropha cultivation is not economically viable under current price and production scenarios. This study concludes that if jatropha has a role to play in the pro-poor bioenergy development, current and future initiatives need to identify high-yield germplasm and agricultural management practices that could optimise yields.

Lessons learned from this study provide advices to policy makers defining promotion plans of both jatropha and other emerging biofuel crops.