Willingness to produce perennial bioenergy crops: A contingent supply approach

Redefining marginal land for bioenergy crop production

“…Various farmer characteristics that have consistently been associated with a higher propensity to grow bioenergy crops include lower age, higher education levels, prior knowledge of bioenergy crops, use of alternative fuels, lower risk aversion, and less present-biasedness (Jiang et al, 2018;Khanna et al, 2017;Lynes et al, 2016;Mattia et al, 2018;Mooney et al, 2015;Qualls et al, 2012;Skevas et al, 2018;Swinton et al, 2017). Off-farm income has been shown to increase the willingness to supply bioenergy crops (Jensen et al, 2007;Qualls et al, 2012;Smith et al, 2018). Farm characteristics such as larger farms, higher percentage of farm leased, higher percentage of land in CRP, more marginal land, land already in a perennial land use such as hay, and the distance to bioenergy pellet facilities also contribute to a greater probability of bioenergy crop production (Jiang et al, 2018(Jiang et al, , 2019Lynes et al, 2016).…”

“…Studies show that farmers may also be reluctant to convert cropland from annual to perennial crops due to lack of availability of equipment, uncertainties about future markets, and their own risk and time preferences (Eaton et al, 2018(Eaton et al, , 2019Fewell et al, 2011;Khanna et al, 2017). There is mixed evidence on the impact of net farm income on incentives to grow energy crops, with Jensen et al (2007) reporting a lower willingness to supply bioenergy crops for farmers with higher net farm income per hectare under the current land use due to the higher opportunity cost of converting land out of its current use, and Smith et al (2018) reporting a smaller amount of acreage supplied with lower total farm income due to the higher aversion to risk and severe liquidity constraints. Khanna et al (2017) show that landowners with crop insurance for food crops are less likely to convert cropland to energy crops.…”