A full economic analysis of switchgrass under different scenarios in Italy estimated by BEE model

Abstract

Abstract Three different scenarios of switchgrass ( Panicum virgatum L .) cultivation (high, mild and low) in two different environmental conditions (North and South Italy) were economically analysed by the computerized model BEE. The dataset was mostly generated from an 8.6 ha field of switchgrass planted in 2002 at the University of Bologna (North Italy). Annual equivalent costs (AEC) and break-even yield (BEY, i.e. the dry matter yield at which cost equals selling price) of each scenario were calculated to assess the feasibility of each scenario. AEC ranged from €511 to €1.257 ha −1 being always higher in northern than southern regions. As expected, BEY varied to an extent depending on input levels. BEY was clearly higher under intensive cropping systems ( H S ) compared to mild-( M S ) and low-input ( L S ) scenarios. However, even for M S or L S , BEY generally exceeded the harvested yield. Therefore, we can conclude that, at the market price of €55 Mg −1 (dry basis), switchgrass can be hardly grown both in North and South Italy. However, the biomass market price appeared surprisingly underestimated if compared to the unit energy price of crude oil, therefore a desirable increase of biomass price could be expected in the next few years. Sensitivity analysis showed that biomass price strongly affects BEY, and this was especially found in H S . Furthermore, the differences in BEY between L S and H S clearly decreased with increasing market prices. Therefore, H S could be better indicated than L S at high market prices. Switchgrass was found to be more profitable than some conventional crops to an extent depending on the yield higher than BEY ( Y i ). At the current biomass price, Y i was from less than 1 Mg ha −1 (maize and alfalfa) to more than 4 Mg ha −1 (sugarbeet).