It might have been a year ago when there was a flurry of meetings about biofuels. Farmers went to one or two meetings, did a quick calculation and never went to another one.
Here’s why:
Say a barrel of oil costs $200. There are 42 gallons in a barrel and there are 6.8 pounds to a gallon of oil. Therefore, one barrel of oil weighs 286 pounds. $200 divided by 286 pounds = 70 cents per pound.
Farmers thought:
How many pounds of nuts would I have to squeeze to make one pound of oil? Certainly more than two. Maybe even four.
If it takes four pounds of a product to make one pound of oil, then, when oil is priced at $200 per barrel, a farmer could expect to make no more than 18 cents per pound.
No sense lose money.
Richard,
18cents/lb for how many pounds of oil per acre?
What gross revenue per acre and/or net returns per acre would be sufficient to get a farmer’s attention?
btw:
Oil palm (Elaeis spp) fruit are approximately 60% oil, meaning 10lb of fruit yields 6 lb of oil, which is more than your farmer above calculated with đ
The kernel also has value for its oil and is a high-quality livestock feed.
Hi James:
According to wikipedia 100 kg of palm fruit will yield 22kg of palm oil and 1.6 kg of palm kernel oil. This is roughly equal to the 1-4 ratio farmers use to guesstimate. Wikipedia estimates that yields are 780 to 1490 Liters per Hectare or, 82 to 157 gals per acre. Using the equivalent of $200 per barrel oil–or $4.80 per gallon, the farmer can expect no more than $394 to $754 per acre.
At $200 per barrel and 70 cents per pound and 35 cents per cup, oil is still very cheap.
Thanks for the reply.
Industry references from Asia and Africa indicate a lot better oil out put than Wikipedia does.
Also, from the September, 2006, HARC report:
“…oil content of the fleshy endosperm can be anywhere from 40-70% in some varieties, and palm kernel oil contents are typically about 50%.”
“One hectare of trees could produce 5,000 kg of oil, or almost 6,000 liters of oil, by
conservative estimates…”
James, thanks very much for the information. I think that HARC can be overly enthusiastic at times. They say that there are 140,000 acres suitable for bio fuel production on the Big Island. At, 634 gals per acre it implies that the Big Island can produce 88,760,000 gals of biodiesel per year. So, we don’t have to worry about changing our lifestyle?
At HARC’s estimate of 6,000 liters of oil per hectare which is the equivalent of 634 gals per acre–a farmer would gross no more than $3,043 per acre per year–based on $200 per barrel oil ($4.80/ gal).
If we had massive amounts of contiguous flat lands that might be doable. But, we are mostly high cost small farms operating on uneven terrain. Some farmers would probably do small scale palm nut cultivation to supplement other farm income. I just worry that we may be relying on our farmers too much. Last week Imperium, the company that was going to build the biodiesel processing plant, announced it was not going to proceed in Hawaii. Now, there is no place for palm nut farmers to deliver the first stage liquid.
I think that the limited supply of farmer grown biodiesel will be used up in heavy transportation and not be available at all for electricity generation. The world has changed!!!
Aloha
Richard,
Agreed about lifestyle and electricity generation.
Neither can rely on biodiesel to maintain a status quo and lot about how we do both in Hawaii are due for a change.
Biodiesel’s foundation market: agricltural and construction equipment, fishing boats, and freight vehicles — mobile, heavy-duty power.