SORSOGON PLANNING EXPANSION OF CASSAVA FOR BIO-FUELS
By Danny O. Calleja
The viability of cassava as source of bio-ethanol has been determined and Sorsogon province is a good prospect for a massive production of this lowly root crop, Vice-Governor Renato Laurinaria said here Tuesday.
“If cassava is becoming an important bio-fuel crop in other countries with more advanced national programs for bio-fuel production, our soils are also capable of large-scale production of the crop not only for food, livestock feeds but mainly for bio-ethanol,” he stressed.
Sorsogon has a vast agricultural land area both in the upland and lowland that is generally suited for cassava because of evenly distributed rainfall and “we can easily come up with an area for a plantation required by the operation of an ethanol distillery plant”, Laurinaria said.
A recently concluded study on bio-ethanol production from cassava commissioned by the Bureau of Agricultural Research (BAR) said an estimated 10,000 hectares of cassava plantation would be required for an ethanol distillery plant’s optimal operation.
This area is necessary to produce cassava flour for the production of the 30 million liters of ethanol per year which is the required capacity, the study conducted for the BAR last year by the International Society for Southeast Asian Agricultural Sciences (ISSAAS) said.
“Castilla alone can already provide 5,000 hectares for this endeavor,” Laurinaria said, referring to the same tracts of land his administration has started to develop into cassava plantations during the latter part of his incumbency as mayor here.
The municipality sits on a 18,620-hectare territorial land and 76 percent or 14,228 hectares of it is agricultural, mostly unirrigated rice fields, coconut and root crop plantations.
The cassava produce of the municipality is being taken in by B-Meg Feeds of San Miguel Corporation (SMB) for its livestock feed mill in Pili, Camarines Sur.
Laurinaria’s term as mayor expired after completing nine years in 2007. He ran for vice-governor in the local elections in the same year and won.
His successor has abandoned the town’s cassava production project, leaving the farmers on their own and denying the local government’s pre and post harvest supports.
“I am going to revive that cassava project on a province-wide scale, this time for bio-ethanol production because I was inspired by the BAR findings on its changes into this industrial undertaking that could make Sorsogon an active participant in the national government’s initiative to make use of our agricultural crops in producing environment-friendly fuels,” he said.
It will, at the same time, provide more jobs for the local workforce and income for farmers and landowners in the province, Laurinaria added.
Although agricultural products in the country specifically grown for use as biofuels include several crops, RA 9367 or the Biofuels Law at present mandates only coconut for biodiesel and sugarcane, sweet sorghum, cassava, and corn for bio-ethanol.
The bio-fuels law took effect in 2007 but the mandated minimum blend of one percent coconut bio-diesel or coconut methyl ester (CME) was first implemented for all diesel engines.
The law says a minimum two percent of bio-diesel should be implemented by 2009 as well as the minimum blend of 5 percent bio-ethanol (E5) for all gasoline engines. The 10 percent blend of bio-ethanol (E10) is scheduled for implementation by 2011.
Nonetheless, the E10 blend is available in the market today with sugarcane probably holding the biggest share of the market at present as records from the BAR show it does best in terms of productivity compared with other sources of bio-ethanol.
The ISSAAS study comprehensively covered all important aspects that need to be considered in producing bio-ethanol from cassava — from production to post-harvest, processing, marketing, organization and management, and, most important, financing.
From the point of view of financial analysis, the study considered three types of investors that would likely go into it. These are corporate and joint venture-run cassava plantation, ethanol processing (primary and secondary) and integrated cassava plantation and ethanol production.
The ISSAAS researchers assumed that the equity of investor for the three cases is 20 percent of the initial capital investment. They likewise considered loaning the remaining capital requirement from the Development Bank of the Philippines (DBP) at 9.75 percent interest payable in seven years with a grace period of three years.
The hyped-up global concern over climate change and the depleting source of fossil fuels triggered the renewed interest on bio-fuels. As a matter of fact, the researchers of the feasibility study observed that cassava is becoming an important bio-fuel crop in China, Thailand, Brazil, and other countries with more advanced national programs for bio-fuel production.
Cassava got the edge as with regards to its cultural management, the study says the crop needs only minimum crop maintenance, responds well to fertilization, is typhoon- and drought-resistant, and can be harvested year-round in areas with evenly distributed rainfall.
“In general, areas suitable for sugarcane production are also favorable for growing cassava,” the study says.
According to the study, cassava has a very high starch-to-sugar conversion ratio. This high starch content means that a high percentage of sugar can be converted from it, and which, in turn, is needed to produce bio-fuel.
The study likewise heralded it as the cheapest feedstock among the major starch-based feedstock for ethanol production.
“Average costs of feedstock per liter of ethanol from molasses and corn are quite high, while those using sweet sorghum is comparable to that of sugarcane. Potentially, feedstock from cassava can be produced at the lowest cost. With high feedstock yield levels, ethanol yield from cassava becomes comparably better than those from sugarcane or sweet sorghum,” the study illustrates.
Part of a feasibility study is a sensitivity analysis on the financial viability of a project. In this particular study, the researchers pointed out sensitivities of cassava’s bio-ethanol production depending on the prevailing price of tubers, changes in yield levels, variation in overall production, and total production cost.
“Cassava can also be the most expensive among the major feedstock depending on prevailing prices of tubers or derived products. Cassava used for food preparations are purchased at a higher price than those used for industrial purposes,” it revealed.
Generally, the study’s computation shows that an increase in tuber yield by 10 percent will increase the average net income by 32.5 percent. On overall production, slight reductions of at least five percent in production cost will increase average net income by 10.1 percent, return on investment by 2.3 percent, and shorten the payback period by 0.3 years.
“The major components of cost are direct labor cost (44.6 percent) and direct materials (30.4 percent). The biggest cost item for direct materials is the cost of fertilizer (73.9 percent) while harvesting expenses accounts for the larger fraction of direct labor costs,” it added.