Quick, how much new equipment will you need to get started as a producer of switchgrass, which is being touted as a potential cellulosic feedstock in the production of ethanol?
The answer — maybe not that much if you’re a cotton producer.
A study of two switchgrass harvest and transport methods, conducted by University of Arkansas Economists Michael Popp and Robert Hogan, looked at the economics of using hay baling and module building equipment for switchgrass harvest. The study was presented at the Farm Foundation’s Biofuels, Food and Fiber Tradeoffs conference in St. Louis.
“What we tried to do was figure out a way for producers to get into the switchgrass market without having to make an enormous investment,” Hogan said. “In fact, they already have an enormous investment in equipment.”
The economists developed enterprise budgets for the two methods of harvesting and transporting switchgrass. The budgets were simulated over 12 years of production.
Costs for establishing and maintaining a stand of switchgrass would be about $220 per acre the first year, $143 per acre the second year and $189 per acre for years three through 12. Marginal land would be targeted for use.
Hogan and Popp assumed that producers would not necessarily shoot for the maximum yield because of the high cost of fertilizer. “So we would fertilize our grass with about 75 units of nitrogen, plus whatever potash and phosphorus soil tests required.”
The switchgrass would be harvested once a year, but there would be no harvest the first year — when the stand is being established. The second year, yield was estimated at 3 tons of dry matter to the acre. For years three through 12, yield was estimated at 5 tons per acre. The stand of switchgrass would last 12 years.
In the hay baling model, the crop would be harvested with a 12-foot disk mower, wind-rowed, baled and wrapped in plastic. “We’ll shoot for harvesting at about 16 percent moisture content at a rate of about 20 bales per hour. When we establish our stand of switchgrass, we’ll make gravel pads on the side of the field where we will store the bales after harvest. The bales will weigh approximately 1,000 pounds each. It will take one person to do the entire operation.
“In the cotton module model, we’ll run a forage harvester through the switchgrass, blow it in cotton boll buggies, dump it in a module builder, compress it and place a tarp over it. When it’s ready to go to the plant, we already have module trucks that can pick the modules up and haul them.”
On the module model, the switchgrass would be harvested at a rate of 15 dry tons per hour, at a moisture content of 15 percent. “One downside is that the module operation requires five operators. You need one person on the harvester, one person each on two boll buggies, one person on the module builder and another person tarping it down.”
Costs, estimated from previous research, puts hauling costs for the round bales at about $3.60 per mile, for distances less than 50 miles. It will cost $1.15 per bale for unloading 26 bales per load.
Costs on module handling varied, according to informal surveys conducted by Hogan. “The module hauling trucks in Texas charged $17.43 a module, plus $1.22 per mile. Arkansas charged about $50 per module and $2 per mile.”
Prorated costs for the round bale system were about $39 per ton, according to the study. Delivered to the plant, the cost is about $52 per ton. With modules, the breakeven to the producer is about $46 per ton. Delivered to the plant, the cost is $62 per ton.
“The module cost is somewhat sensitive to the cost of the module tarps, which cost between $100 and $125 each and have a life expectancy of about three years.”
He noted that an advantage to the module system is that switchgrass is already chopped by the time it gets to the ethanol plant, while round bales are not. “So you will have to add that cost, although we don’t know what that cost would be.”
Biorefinery capacity was set at 50 million gallons annually at a conversion rate of 90 gallons per dry ton of switchgrass. With 350 operating days, this requires approximately 1,587 dry tons of biorefinery processing per day.
In other words, the plant would need to process 128 truckloads of round bales or 196 modules per day. Both systems require approximately 132,000 crop acres in switchgrass in a 1,174 square mile area surrounding the plant.
Experts at the conference believe that cellulosic ethanol will start making a significant contribution to the biofuel effort in 2012. It could lead to massive changes in land use, mostly for pastureland.
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