Browsing by Subject "Agrofuel"

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Agrofuels, large-scale agricultural production, and rural development : the case of Jatropha in Madagascar
(2019) Bosch, Christine; Zeller, Manfred
Agrofuel production in marginal areas can contribute directly to creating employment and improving local livelihoods. Indirectly, through increasing household purchasing power and relaxing financial constraints of smallholder farmers, it can contribute to greater food production and/or food consumption and rural development. These benefits depend, however, largely on the feedstock crop and its processing, land and labour requirements, the business model, value chains and institutional frameworks. Jatropha, a feedstock crop with more benefits than first-generation energy crops like maize, experienced a spike in popularity in the early 2000s due to its value in the biofuel markets of industrialized countries. The majority of plantations and outgrower schemes could not survive what followed: disappointing yields, pests and disease, low oil prices, the 2007/2008 food price crisis, negative narratives, and inadequate funding for further research activities. Despite these challenges, large-scale land investments and new Jatropha projects continue to be undertaken. Madagascar is a country characterized by severely eroded and degraded pasturelands, low agricultural productivity, high vulnerability to climatic shocks, and overwhelming poverty and food insecurity rates. It is hypothesized that the use of marginal lands for labour-intensive agrofuel feedstock cultivation, in otherwise neglected areas, through both public and private investment, will have positive impacts through the provision of wage work in large-scale plantation schemes. Although a number of studies have investigated the rural livelihood impacts of participation in Jatropha cultivation, there is little evidence that quantifies the long-term and indirect effects on smallholder food production and household food security. Against this background, large-scale Jatropha cultivation lends itself well to studying the complex interplay between feedstock and food production, as well as the potential for agricultural and rural development. Such analysis would provide useful insights and implications for cost-effective rural development policies to target poor farmers in remote areas. Drawing on a conceptual framework that highlights the role of smallholder farmers’ livelihood strategies like off-farm employment and agricultural intensification, and livelihood outcomes like food security, this thesis explores the contribution of large-scale agrofuel feedstock cultivation on marginal land. Three important outcomes, namely household food security, information and innovation spillover effects, and agricultural input use, are studied empirically in three articles, using a comprehensive household panel data set. The data was collected in six survey rounds between 2008 and 2014, in three villages near a large-scale Jatropha project in the Haute Matsiatra region, located in Madagascar’s Southern Highlands. The first article examines the relationship between wage work for a Jatropha project and household food security. Jatropha cultivation on marginal land is labour intensive and does not compete with food production. Therefore, incomes earned can contribute to increased food security directly as well as indirectly through increased or diversified food production. Using five rounds of household panel data, results show that labour demand from the plantation declined substantially after the build-up phase and Jatropha incomes were mostly used for food and other necessities. Fixed effects models show that Jatropha work contributed significantly to an improved dietary diversity. Despite the possibility to earn income during the lean season, Jatropha work did not lead to a reduction in the more subjective lack of food and led to reduced rice stocks. Both food production and consumption were highly influenced by drought shocks and locust plagues, indicating that complementing income creation strategies with agricultural development strategies might have further positive effects on food security. To shed light on the impact pathway from Jatropha work to agricultural production, the second article explores information dissemination through social networks and through Jatropha workers who are more exposed to modern technologies than control households. In addition to institutional factors, a lack of knowledge and limited extension services for improved agricultural technologies are considered barriers to information dissemination. Using two rounds of the dataset, which contains rich information on social capital and networks as well as knowledge and innovations, determinants of production-relevant knowledge like extension services, credit and marketing opportunities are estimated. Accounting for potential endogeneity with lagged and instrumental variables, the relevance of this knowledge to the adoption of innovations and the cultivation of a formerly taboo legume, as an example of diversification, is tested. The results indicate limited access to information, little knowledge on investment and marketing opportunities, and low adoption of innovations. Knowledge is relevant for both innovation performance and the cultivation of the Bambara groundnut, highlighting the need to increase and improve public extension services and information dissemination in rural Madagascar. Adoption is not only encouraged by knowledge, but also directly motivated through informal social networks. Bambara groundnut spillovers from the biofuel project can be observed, relaxing some of the constraints farmers face concerning access to information, social learning, and cultural norms. The third article explores one specific hypothesized spillover: access to and use of agricultural inputs. Given the very low use of improved inputs in rural areas in Madagascar, this study explores whether improved seed and seed information distributed to farmers encourages farmers to cultivate the seed. The analysis is based on household data gathered between 2012 and 2014 from 390 households in three villages. To investigate the adoption of improved seed, as well as the diffusion of information regarding improved seed, a randomized control trial was applied in 2013. Half of the 390 households were randomly assigned to receive the improved lima bean seed (Phaseolus lunatus), which is specifically bred for dry regions. Of the seed-receiving households, half were randomly assigned to receive information on how to store, plant, and cultivate the improved seed, as the variety was unfamiliar in the region. The control group and the two treatment groups are compared with respect to baseline characteristics, bean cultivation, information exchange with other farmers, legume consumption, and willingness to pay (WTP) for improved bean seed. To account for non-compliance, contamination, and spillover effects, local average treatment effects (LATE) are estimated. Of the seed-receiving households, 54% cultivated the seed, reaping an average yield of 6.3 kg for each kilogram of seed obtained. Seed information did not lead to higher yields. A small significant positive impact of seed distribution on legume consumption is found. WTP is 171% of the local market price for bean seed; provision of free seeds and information did not result in a higher WTP. Based on these findings, this thesis contributes empirical evidence that large-scale agrofuel feedstock production on marginal land can enhance rural livelihoods by offering alternative livelihood strategies especially for poorer households and contributing to improved livelihood outcomes. Accounting for the indirect effects shows important impact pathways on the livelihood strategies of farmers in a remote area. The provision of incentives for private investors, complemented by more public intervention in rural areas, as well as more investment in agricultural research and extension to reduce agricultural production risks, might enhance these spillovers.
Opportunities and constraints for agrofuels in developing countries : case studies on economic viability and employment effects of Jatropha production
(2010) Grass, Martin; Zeller, Manfred
This dissertation was motivated by controversial statements of politicians and lobby groups for and against first-generation agrofuel production. Therefore this thesis contributes to a more realistic view on opportunities and constraints for agrofuel production based on first-generation technologies. The findings are based on an intensive literature review covering the following topics: current production trends of ethanol and agrodiesel, their potential for fossil energy substitution and greenhouse gas reduction including related costs, rural development and poverty alleviation. This more general overview on agrofuels was deepened by own research on Jatropha seed production in India and Madagascar. In this context the economic viability of Jatropha seed production and possible income effects for households living in the vicinity of a Jatropha plantation were analyzed. For this special agrofuel feedstock the findings allowed shedding some light on important aspects of the much broader topic concerning the production of agrofuels. To cover the above mentioned topics this dissertation is structured around three research papers. The first paper identifies and discusses the opportunities and constraints of first-generation agrofuel production in developed and developing countries and is based on an intensive literature review. Therefore this paper contrasts arguments used by politicians to justify agrofuel support measures like energy security, greenhouse gas reduction potential, income generation and possible rural development with new scientific findings on each argument. Furthermore data on worldwide trends in ethanol and agrodiesel production were presented. The second paper focuses on one possible option to lower competition between food and agrofuel production at least partially. This option is seen in the production of Jatropha seeds on marginal land not suitable for food production. In this context an Indian case study revealed the economic viability of Jatropha seed production on marginal land. The database for this study includes data derived from literature as well as experimental field data provided by the ?International Crops Research Institute for the Semi-Arid Tropics?. The third paper addresses possible income effects for rural households offering their labour force to a Jatropha plantation in central Madagascar. The econometric impact assessment is based on a socio-economic household survey undertaken by the author in 2009. To account for possible selection bias the propensity score matching approach was used to estimate the average treatment effect on the treated by comparing the average income of Jatropha plantation households and control households. The findings for 336 households reveal positive income effects for households working at the Jatropha plantation. The dissertation concludes that more investments in research are needed to gain a potential win-win situation for rural households, investors and the environment especially for the case of developing countries. The results lead to the conclusion, that smallholder based Jatropha seed production should not be promoted in developing countries. Therefore this dissertation concludes further that it would be far better for developing countries to let international investors set up Jatropha plantations, hence in this case the economic risk is borne by the foreign investors. Furthermore abundant labour in rural areas could find employment opportunities with such plantations and therefore would be able to generate some income for their families. Nevertheless the implementation of Jatropha projects financed by international investor?s needs regulations set up by national governments. Those regulations should cover each aspect within the entire value chain of Jatropha agrofuel production and should be embedded in a national energy and rural development policy. Furthermore institutional frameworks such as land tenure security and labour rights have to be enforced. Setting up aforementioned regulations and institutional frameworks can prevent possible constraints such as, land grabbing, exploitation of rural labourers, loss of biodiversity and competition between Jatropha seed and food production e.g. for scarce water, which could occur due to foreign investment in local Jatropha (and other agrofuel feedstocks) cultivation in the worst case.