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Experience with Jatropha in Peru and Honduras CFC/DED pilot project Production of vegetable oils as fuel in replacement of diesel for public transport.

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Presentation on theme: "Experience with Jatropha in Peru and Honduras CFC/DED pilot project Production of vegetable oils as fuel in replacement of diesel for public transport."— Presentation transcript:

1 Experience with Jatropha in Peru and Honduras CFC/DED pilot project Production of vegetable oils as fuel in replacement of diesel for public transport in Peru and Honduras Peter Thoenes FAO - Trade and Markets Division International Consultation on Pro-poor Jatropha Development IFAD, Rome, April 2008

2 2 1.Project overview 2.Key features 3.First findings & main challenges agronomic/technical economic social institutional 4.Conclusions

3 3 1.Project overview small-scale pilot project on the cultivation of jatropha and rapeseed and the direct utilization of their oils as fuel for local transportation primary objective: to test technical & economic viability and suitability for smallholder farmers living in marginal areas budget & funding sources: total cost USD 3.3 million USD 1.7 mill grant Common Fund for Commodities (CFC) and Government of the Netherlands USD 1.6 mill counterpart contributions (in kind and cash)

4 4 Project overview (contd) implementing agencies: Deutscher Entwicklungsdienst (DED) national governments, farmers (associations), entrepreneurs, national research institutes duration: 3 years (April 2007 – March 2010) location: Peru (costa, sierra, selva), Honduras project supervisory body: FAO (IGGOOF)

5 5 2. Key features (jatropha component) target groups: associations of small, resource-poor farmers working in marginal areas, distant from main markets small entrepreneurs (processors, bus owners) operating in the same areas focus on: small scale and local resources & markets: local seed crushers, local mini-bus companies, on-site adaptation of bus engines.... as opposed to large-scale plantations and processing, full mechanization, transportation to distant markets, industrial refining into biodiesel, external investors, export orientation full compatibility with existing, local farming systems no direct competition with foodcrops for land simple, easy-to-procure technology (cultivation, processing)

6 6 Key features (contd) short commodity chain - entire chain from the primary product to the end user limited number of actors close-by markets local value addition local employment & income ingeneration reduced dependence on external markets/prices public-private partnerships - close interaction between farmer associations/cooperatives small/medium-sized enterprises (SMEs) researchers and extension workers local governments private investors

7 7 3. First findings & main challenges a) agronomic/technical b) social c) economic d) institutional

8 8 a) agronomic/technical first findings : high adaptability & good performance in different agro-ecological zones grows under marginal/extreme conditions (soil quality, rainfall) suitable for otherwise uncultivated or underutilized land suitable for direct planting (seeds, cuttings) planting density up to plants/ha in arid zones: temporary drip irrigation (small-scale; simple & low cost; resource efficient) yield estimates (using mix of local landraces/ecotypes): promising, but wide range - depending on seed material minimum 6-7 t/ha average 9 t/ha most performant 12 t/ha (= 4t oil)

9 9 agronomic/technical (contd) very responsive to improved cultivation methods in particular pruning mulching; bees-assisted pollination; etc. performs well without chemical fertilizer, pesticides, herbicides good natural pest resistence (once plant is established) highly suitable for inter-cropping (variety of staple and cash crops) regular labour requirements: weed control manual, year-round harvesting post-harvest treatment (depulping) oil fully suitable as fuel in modified diesel engines

10 10 agronomic/technical (contd) four main challenges : 1. trial & error approach, experimental nature... need for: NARS driven, systematic on-station/on-farm research networking and exchange between NARS 2. seed shortage (local & improved varieties)... need for: (i) systematic, integrated seed selection programs, (ii) identification of traits of economic importance, (iii) breeding and genetic improvement farmer-managed revolving seed funds national and regional genebanks (general access; safe exchange; public-private financing; partial cost-recovery) commercial production & distribution of improved seed

11 11 agronomic/technical (contd) 3. farmer training in cultivation practices... need for: collaboration between NARS, national extension services, local NGOs 4. labour-saving technological innovations (depending on scale of operations) improved weed control uniform flowering/fruiting machine harvest mechanical depulping

12 12 b) social first findings: farmers are responsive, stimulated & committed compatible with existing farming systems, labour allocation, etc. farmers associations are not new value of land is reported to have increased in project areas three main challenges: 1. viability & sustainability of farmer associations to be proven 2. limited management and commercial skills provide training 3. farm-labour bottlenecks (depending on size of operations) closely monitor farm-labour use availability of off-farm labour gradual mechanization

13 13 c) economic first findings: (tentative) readily available market... current demand by far exceeding supply ! interested, motivated entrepreneurs positive economic returns confirmed for key actors of the commodity chain: farmers, processors, bus owners based on price assumptions: USD/t seed and USD/t oil including lending (by farmers, processors) and own investment (by bus owners) main challenges: 1. critical role of yield levels (7-12 t/ha) 2. long spell until jatropha reaches full maturity 3. need to guarantee constant supply flow and homogenous quality 4. contractual arrangements to be tested 5. access to credit, loan guarantees 6. potential competition from other biofuels (... role of gov. policies!) 7. sensitive to price developments of crude oil s

14 14 d) institutional first findings: limited direct interaction with governments weak formal linkages with NARS/extension systems (as to be expected with pilot project...) increasing awareness among policy makers in Peru, Honduras and elsewhere rising interest from NGOs; parallel activities and exchanges increasing interest from donor community & media... more dissemination/sensitization work is planned main challenges: 1. mobilization of government support to NARS & public extension systems 2. creation of an enabling environment -- call on governments, donor community, CGIAR-system, others:.../...

15 15 institutional (contd) a) action at national level stimulate private-public collaboration in research (... how?) regulate seed certification, control and marketing review of land use policies strengthen rural credit (favourable rate, loan guarantees) regulation of domestic fuel market: adapt biofuel norms & ensure quality control; provide tax incentives regulate fuel distribution and sale; control pricing coherent national energy policy b) international input policy advice and technical assistance stimulate international cooperation in research on jatropha facilitate germplasm exchange and seed trade between countries

16 16 4. Conclusions first promising findings (technical, economic viability) but results need to be confirmed sound developmental approach (social impact & resource utilization) considerable potential for replicability scope for expansion into other local uses (rural electrification in remote areas) need for increased external/international assistance & coordination room for NGOs key outstanding challenges: agricultural research seed supply sensitization of policy makers stimulation of public-private partnerships

17 17 Thank you for your attention... on behalf of the entire project team ! CONTACT:

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