SAC - Economic evaluation of biodiesel production - 2005 report

A study undertaken by the Scottish Agricultural College (SAC) Consultancy Division on the potential for a biodiesel industry in the north and east of Scotland. The full report or a simpler executive summary can be downloaded here, right.

The report was commissioned by a partnership comprising:

• Aberdeenshire Council
• Angus Council
• Fife Council
• Highland Council
• Moray Council
• Perth and Kinross Council
• Highlands and Islands Enterprise, and
• Scottish Enterprise Energy.

A main aim of the study is to identify the means of optimising the value of the oilseed rape (OSR) crop to growers in the study area, which produces around 7 per cent of the OSR grown in Scotland.

CAP reform has decoupled subsidies from production and farmers are now more exposed to market prices, which in the cereal sector, have shown marked decline in the last decade. While oilseed rape has been a useful break-crop within the rotation, comparison of net margins between cereals and oilseeds are altering, due to world market prices and growing demand for oilseeds for the biofuels industry.

The report identifies a number of key issues which require to be addressed before any production infrastructure could be developed with confidence and the partners are inviting feedback from stakeholders over the next three months. The study is expected to stimulate extensive discussion in the agricultural, fuel and associated industry sectors, particularly as Scotland has potential to produce oilseeds with a high oil content, but farmers lose significant value of their crop due to the transport costs to processing plants in England or overseas.