How profitable is switchgrass in Illinois, USA? An economic definition of marginal land

Background

Decisions regarding the conversion of land from an existing crop to bioenergy crops are critical for the sustainable production of both food and fuels. This study seeks to establish criteria for delineating land as “economically marginal”, and thus suited for growing switchgrass.

Methods

In this case study of an Illinois agricultural field, the profitability of switchgrass, with farmgate prices of $44 Mg⁻¹, $66 Mg⁻¹, or $88 Mg⁻¹, was compared to corn and soybean crop prices. Further, the study also evaluates the profitability of switchgrass when replacing corn-based yield estimates from the Soil Productivity Index (SPI) of Illinois.

Results

Based on a dry-matter yield of 10.45 Mg ha⁻¹, switchgrass can compete with soybeans only at the high price of $88 Mg⁻¹, but depending on location, can compete with corn at $66 Mg⁻¹. Across Illinois, at $88 ha⁻¹, all Illinois land with SPI < 100% and 95% of land under SPI class C (SPI 100–116) is profitable under switchgrass. Switchgrass may not be profitable relative to corn grown in the SPI class A (SPI > 133) and only 7% of class B (SPI 117–132).

Conclusions

Our results show that land with drainage and erosion limitations is economically marginal when corn and soybean yields are low, and the farmgate price for switchgrass is greater than $66 Mg⁻¹. However, this may not be possible on land where switchgrass is replacing frequent soybean rotations (corn–soybean ratio ≤ 1). Land used to produce only soybeans may only be marginal at the farmgate price of $88 Mg⁻¹. Further studies need to be conducted to identify how much land can be converted to switchgrass without harming corn production.