Economics of Bioenergy from Economics of Bioenergy from Jatropha Jatropha curcascurcas::

Promises, Opportunities and Constraints in Kenyan Promises, Opportunities and Constraints in Kenyan ContextContext

Miyuki Iiyama Miyuki Iiyama11, Patrick Zante, Patrick Zante22, Cristel Munster, Cristel Munster11, David Newman, David Newman33, James Onchieku, James Onchieku44, Meshack , Meshack NyabengeNyabenge11, ,

Violet MoraaViolet Moraa1,51,5, Ramni Jamnadass, Ramni Jamnadass11 and Jean Albergel and Jean Albergel66

1. ICRAF, Kenya; 2. IRD, France; 3. Endelevu Energy, Kenya; 4. KEFRI, Kenya; 5.University of Nairobi, Kenya; 6. IRD, Kenya. 1. ICRAF, Kenya; 2. IRD, France; 3. Endelevu Energy, Kenya; 4. KEFRI, Kenya; 5.University of Nairobi, Kenya; 6. IRD, Kenya.

22ndnd World Congress of Agroforestry World Congress of Agroforestry

NairobiNairobi

27 August, 200927 August, 2009

OverviewOverview

•Literature Review•Activities in Kenya•Value Chain Development•Descriptive Statistics

- Methods - Profiles of Farmers - Yields

•Economic Analysis •Conclusion

Literature ReviewLiterature Review•Agronomic Parameters

• Jatropha Dry Seed Yield Across Different Rainfall Regimes• Wide variations: 0.2kg/tree – 2kg/tree• No systematic recording

•Economic Analyses from TZ • Uncertain yield estimates• Low results

• International Call for Research• Provenance trials• Agronomy trials• Breeding programs

Range OptimalAnnual temperature(˚C) 18 - 38˚C n/aAnnual rainfall (mm) 300 - 3,000m 1,000 - 1,500mmAltitude 0 - 1,800mm n/aSoil well drained, sandy soils with pH <9

• Historical and Current Activities in Kenya• Sporadically old trees planted as hedges for years• The boom started around 2006• Most activities are small-scale farmers

• News reports of large-scale foreign investment plans

• Unsystematic promotion of activities• Various organizations & institutions• Different information being relied on w/ little based on empirical

data • Policy Development

• National Biodiesel Committee (subcommittees on Research, Policy)

• KEBS & KERC draft standards & regulations on biodiesel

An old fence (Shimba Hills) An old tree (Ralleda, Nyanza) A 3-year old plot (Mtito Andei, Eastern) A 50-ha experimental plantation (Kiambere)

Activities in KenyaActivities in Kenya

Value Chain DevelopmentValue Chain Development• Potential Jatropha Value Chain

• Potential opportunities utilizing oil and by-products• Requiring significant technology development on processing &

end-use

• Development in Kenya• Active nurseries selling seeds and seedlings at high prices• Planting, mainly by smallholders• Experimental, small amount of SVO being tested

Descriptive StatisticsDescriptive Statistics::Locations of 289 Jatropha Farms VisitedLocations of 289 Jatropha Farms Visited

Descriptive StatisticsDescriptive Statistics::Profile of 283 FarmsProfile of 283 Farms

Plantation Age Group

1year

2year

7+year

4-6year

3year

29%

21%

10%

11%

29%

Plantation Type

fence monoculture

intercrop

27%

46%

27%

Agroclimatic Zones of Plots

NAhumid

sub-humid

semi-humidsemi-humid to

semi-arid

semi-arid

arid

4%13%

7%

35%19%

20%

2%

Plot Size (Acres)

0.1<=

0.25<=0.5<=

1<=

1.5<=

3<=

5<=

5>NA

32%

21%13%

14%

5%8%

1%2%4%

YieldsYieldsReal (year 0-4) and Projected (year5+)Yield Real (year 0-4) and Projected (year5+)Yield

(kg/tree)(kg/tree)

0

0.2

0.4

0.6

0.8

1

1.2

1.4

year0 1 2 3 4 5 6 7 8+

kg/ treesMonoculture low Monoculture high Intercrop low

Intercrop high Fence low Fence high

Economics AnalysisEconomics AnalysisAssumptionsAssumptions

• Assumptions on Revenue• Yield data is based on high/low yield case scenarios for each

plantation type• The farm price of seed is assumed at 15ksh/kg (0.2USD/kg)

• Assumptions on Costs• Cost and labor data taken from average survey data for each

plantation type• Fence includes very few inputs

Type Spacing No.of trees/ acre ManagementMonoculture 2.5m x 2.5m 647 IntensiveIntercrop 4m x 4m 253 ModerateFence 0.5m apart 508 Minimum

Economics AnalysisEconomics AnalysisNet Margin of Jatropha by Plantation Type/Yield Net Margin of Jatropha by Plantation Type/Yield

CaseCase

-12000

-10000

-8000

-6000

-4000

-2000

0

2000

4000

1 2 3 4 5 6 7 8 9 10

year

Ksh/ acre

Monoculture low Monoculture high Intercrop low

Intercrop high Fence low Fence high

ConclusionConclusion• Findings

• Monoculture: low yield scenario not profitable; hi yield only profitable in year 8

• Intercropped: both low and high yield scenarios not profitable

• Fence: both hi and low yield profitable only after five years

• Recommendation • substantial investment cannot be recommended at the

current technological and market conditions, except fence• Local decentralized use of oil should be explored for

development• Agronomy/provenance trials are urgently required to

investigate factors to ensure high-yielding, drought-tolerant species

Thank You

Acknowledgment to• Gesellschaft für Technische Zusammenarbeit (German

Technical Cooperation-GTZ) Kenya• Ms Carol Hunsberger of Carleton University• Dr Joseph Ogutu of ILRI• Farmers, Agricultural & Government Officers and all other key

stakeholders • Japanese Ministry of Foreign Affairs, Japanese Embassy in

Kenya