TY - JOUR
T1 - Producing biodiesel from soybeans in Zambia
T2 - An economic analysis
AU - Drabik, Dusan
AU - de Gorter, Harry
AU - Timilsina, Govinda R.
PY - 2016
Y1 - 2016
N2 - Facing a huge fiscal burden due to imports of its entire petroleum demand in the face of ample supply of agricultural land to produce biofuels, Zambia has recently introduced a biofuel mandate. However, a number of questions, particularly those related to the economics of biofuels, have not been fully investigated yet. Using an empirical model, this study analyzes the economics of meeting the biodiesel mandate using soybean oil. The study finds that meeting the biodiesel mandate would reduce social welfare, mainly because of the welfare loss to fuel consumers and net reduction in foreign exchange earnings due to soybean oil imports. However, if Zambia increases its domestic soybean supply, as well as oil yield, soybean-based biodiesel is likely to be welfare-beneficial. The country's welfare is found to be the highest under expanded soybean production and its domestic processing but with no biodiesel mandate.
AB - Facing a huge fiscal burden due to imports of its entire petroleum demand in the face of ample supply of agricultural land to produce biofuels, Zambia has recently introduced a biofuel mandate. However, a number of questions, particularly those related to the economics of biofuels, have not been fully investigated yet. Using an empirical model, this study analyzes the economics of meeting the biodiesel mandate using soybean oil. The study finds that meeting the biodiesel mandate would reduce social welfare, mainly because of the welfare loss to fuel consumers and net reduction in foreign exchange earnings due to soybean oil imports. However, if Zambia increases its domestic soybean supply, as well as oil yield, soybean-based biodiesel is likely to be welfare-beneficial. The country's welfare is found to be the highest under expanded soybean production and its domestic processing but with no biodiesel mandate.
KW - Biodiesel
KW - Biofuel policy
KW - Biofuels
KW - Soybean
KW - Sub-Saharan Africa
KW - Zambia
U2 - 10.1016/j.foodpol.2016.01.001
DO - 10.1016/j.foodpol.2016.01.001
M3 - Article
AN - SCOPUS:84955146098
SN - 0306-9192
VL - 59
SP - 103
EP - 109
JO - Food Policy
JF - Food Policy
ER -