Fuel from the Farm: An analysis of the profitability and factors driving farmers’ decisions to produce bioethanol from cassava in Northern Uganda

Abstract

This study examined profitability of producing bioethanol and factors that drive farmers’ decisions to produce bioethanol from cassava. Although small scale production of bioethanol was found to be profitable, selling cassava dry chips was found to be more profitable. In addition, selling fresh cassava roots was also more profitable than small scale production of bioethanol. However, bioethanol producers who grow cassava and process bioethanol get more returns on investment compared to those who buy cassava chips and process bioethanol. Sensitivity analysis results revealed that 40% decrease or increase in price of dry chips and firewood contributed remarkable change on profitability of bioethanol. The results also reveal that growing improved cassava variety, ownership of land of 2 acres ( ≈1 ha), allocating more proportion of land to cassava, engagement in off-farm work and profitability of bioethanol, positively influenced farmers’ decisions to produce bioethanol while sex of household head, Pentecostal Christian, profitability of dry chips and condition of the road negatively influenced farmers’ decisions to produce bioethanol. The paper concludes that promoting bioethanol production from cassava will require meeting the food security demands by increasing cassava production through expansion of acreage and promoting planting of improved high yielding varieties. This should be coupled with reduction of costs of processing bioethanol and expansion of market opportunities through extra value addition

Key words: Cassava bioethanol, drivers of production, profitability analysis, sensitivity analysis, Uganda