Comparative Analysis of the Profit Risk in the Cultivation of Energy Beet in North Dakota

Abstract

Energy beet is a promising ethanol feedstock as it did not compromise the food security given it is not used as a food or feed. Although the technological and financial feasibility studies were available the risk of yield and profit aspect is not considered in the previous studies. Hence this study focuses on the cost of private risk bearing of a representative energy beet grower comparing to the other crops in North Dakota. The lowest risk premium is reported for the dry land production at the Langdon Research and Extension Centre (REC). Further in Langdon energy beet has the lowest risk premium (0.733USD/acre) comparing to the conventional crops. Hence a risk averse farmer can opt for energy beet in Langdon. The certainty equivalent is highest in Oakes irrigated experiment site followed by Carrington irrigated REC. Hence in irrigated sites energy beet can be a financially appealing crop for farmers.