The drought resistant Jatropha curcas plant and its biofuel potential may present speculators with an opportunity for investment in low-cost land that is not currently arable for most crops or suitable for development.
Widespread interest among alternative energy corporations is leading to large-scale production across the globe; BP and D1 Oils, a UK-based biodiesel producer, recently announced a $160 million, five-year joint venture in development of jatropha as a viable biodiesel feedstock.
Early excitement surrounding jatropha sparked a rapid land grab in Africa in February, according to The Washington Times. Since then, major cultivation of jatropha has been underway in Asia.
Mission Biofuels, an Australian company, owns a 22,000-acre jatropha plantation in Malaysia and has plans for expansion. Eco Solutions, based in Korea, grows jatropha in the Philippines. Jatropha has even emerged in the public sector in China, where the government offers subsidies for growth of jatropha crops in some southern provinces.
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BP and D1 have similarly announced plans to plant jatropha in India, Southeast Asia, Southern Africa and Central and South America, with an estimated total of one million acres dedicated to its cultivation.
The spread of jatropha production across the globe may have positive implications for developing countries. Not only do jatropha plantations offer the potential for job growth, but jatropha fuel may also supply energy to surrounding populations. Hundreds of villages in Mali are already utilizing jatropha as a major energy resource.
The jatropha plant is known to thrive in hot, dry conditions. Because it can be grown on land not traditionally used for agriculture, it has the added benefit of “not competing with food crops for good agricultural land or adversely impact[ing] the rainforest,” according to a BP press release.
Oil extracted from jatropha’s inedible seeds produces one-fifth the carbon emissions of traditional fossil fuels. Because the plant is not edible, production would not affect or be affected by demand for food, a problem that faces the palm oil and corn ethanol industries. The upshot is that jatropha oil should be a cheaper alternative in comparison to “edible” fuels.
While jatropha’s rise in production may seem promising, an important caveat to consider is that it will take years before the biofuel is considered to be a viable market product. In addition, scientific research aimed at optimizing jatropha’s growth potential is still in progress.
Investors who are interested in purchasing land that could be utilized for jatropha cultivation may want to consider “multi-purpose” real estate that could support additional forms of alternative energy, such as wind farms. Wind energy is a viable market and turbines could easily share acreage with jatropha in areas with substantial wind exposure.