Fighting global warming and the war on drugs: The potential to use opium poppies as biofuel feedstock in Afghanistan

March 31, 2009 · Filed under Agriculture, Biofuels, Land use and land management

By Sean Killian

Afghanistan accounts for roughly 93 percent of the world’s total poppy production, and converts 90 per cent of its 8,000 tons of raw opium into heroin. In recent years, bilateral and multilateral aid projects have spend billions of dollars on “alternative development” projects aimed at moving farming communities from growing opium poppy to growing licit crops. Nevertheless, and despite a recent contraction in output, opium production remains high in part because few licit crops fetch the same farm-gate price. One alternative use for opium poppy, which yields roughly the same level of oil as rapeseed, is use as a biofuel feedstock. This paper examines the potential domestic and regional market for poppy-based biodiesel, the price at which poppy-based biodiesel would need to sell, and the role multilateral and bilateral aid might need to play.

Introduction

Lack of productive alternatives has driven more that 2 million Afghan farmers to poppy cultivation. The country now accounts for roughly 93 percent of the world’s total poppy production, and converts 90 per cent of its 8,000 tons of raw opium into heroin (7). Although bilateral and multilateral “alternative development” programs have for years attempted to wean local economics from poppy production, opium poppies continue to fetch much higher market prices than licit alternatives, including promising crops such as pomegranate and saffron. Weak enforcement regimes, government corruption, and drug militias exacerbate the problem.

According to the United Nations, more than 157,000 hectares, or nearly 2 percent of arable land in Afghanistan, is currently under opium poppy cultivation (9). Although this figure has risen and fallen over the past few years, at least 100,000 hectares have been in production annually since 2002. Recent history suggests that poppies will continue to be grown until a substitute agricultural commodity with a higher price replaces it. Until that time, researchers have been exploring alternative uses for opium poppies, including use as a feedstock for biodiesel.

Poppies for Biofuels in Afghanistan

Yield Potential

Opium poppies are a viable feedstock for biodiesel. They yield 978 kg oil per hectare, which is about the same as rapeseed (1,000 kg) and nearly three times that of soybean (375 kg)(13). Moreover, compared with the palm-based biodiesel used in southeast Asia, poppy-based biodiesel would run better in colder central Asian climates (1). A poppy-seed biodiesel plant is already operating in Tasmania, and Australia’s science agency is reportedly hoping to invest in Afghanistan’s crop (4).

In making biodiesel, the parent oils are mixed with methanol in a reaction known as alcoholysis or transesterification. In this process, a large amount of methanol is used to ensure that the reaction is driven in towards biodiesel, pushing yields in excess of 98 percent on a weight basis (2). Together with total hectares under cultivation and kilograms of oil per hectare, we calculate annual gallons of biodiesel from opium poppies in Afghanistan to be:

978 kg oil per ha. x 157,000 ha. = 153,546,000 kg oil x 0.98 yield = 150,475,000 kg biodiesel

“150,475,000 kg x ” “2.2 lbs.” /”1 kg” ” x ” “1 gal.” /”7.37 lbs.” ” = 44,918,000 gallons per year under constant conditions”

About half of this total could displace all domestic consumption: Diesel consumption in Afghanistan was 90,000 metrics tonnes or 28,195,000 gallons in 2006 (11). The rest could potentially be exported to Pakistan, where diesel consumption from last May to July alone was 2.37 billion gallons.

Emissions Reduction Potential

Poppy-based biodiesel would not only drastically reduce stocks of the raw material required for heroin production, it would also serve to reduce greenhouse gas emissions. Since the agricultural land is already in production, the harvest of poppies for biofuels would have no impact on below-ground carbon stocks and require no additional fossil energy than is already being used. Using poppies for biofuels would, however, displace fossil fuels. Carbon dioxide emissions from a gallon of diesel is 22.2 pounds, which means the emissions offset by maximum production and consumption of opium poppy biodiesel would be 997 million pounds per year (3). This is the equivalent of removing 86,700 cars from the road.

The Economics of Poppies

Although opium prices fell by around 20 percent last year as a result of a massive glut on the opium market due to three years of overproduction, none of Afghanistan’s licit agricultural products can currently match the income per hectare from opium poppy. In December 2008, the farm-gate price of dry opium was $86 per kg (9). In contrast, the farm-gate prices for rice and wheat were $1.12 and $0.60 per kg, respectively. In a survey conducted by the United Nations last year, 53 percent of farmers said that the higher sale price of poppy as compared to other crops was the dominant reason for growing opium poppy (9). About one-third cited poverty alleviation.

One hectare yields 39 kg dry opium, translating into $3,354 per hectare per year at December 2008 prices. That same product, if pressed for its oil instead of dried, would yield 978 kg oil and would need to clear an oil farm-gate price of $3.43 per kg or $1.03 per gallon to be competitive with dry opium market prices. Retail diesel prices in Afghanistan are roughly $2 a gallon, and with current crude oil prices at $53 a barrel or $1.26 a gallon, biodiesel refineries would likely purchase opium poppy feedstock for far less than $3.43 per kg. As a result, significant subsidies would be required to ensure that farmers would sell their opium poppies to biorefineries and not to narcotraffickers.

Multilateral Subsidies and Afghan Poppies

At December 2008 black-market farm-gate prices for opium poppies, $527 million dollars would need to go to farmers for the purchase of all poppies for biodiesel feedstock. This amount, which would only in part need to be subsidized, represents 24 percent of bilateral and multilateral aid send to Afghanistan in 2006, an amount that has and will likely continue to rise. Irrespective of other bilateral agreements, the United States Agency for International Development has $779 million under obligation for 2007, and has requested more than double that for 2009 (12). These numbers suggest that the international community would be able to afford annual subsidies that would provide farmers with income without supplying the heroin market, and simultaneously displace fossil fuels.

International aid projects to date have done little to curb opium production. Although hectares under cultivation have decreased sharply since record levels in 2007, total land under cultivation is still double that of 2002. International aid projects have, however, dramatically improved the country’s infrastructure systems and irrigation networks, which in turn has boosted demand for fuel and reduced prices along the agricultural supply chain.

Conclusion

Poppy cultivation appears to be slipping, but it remains and will likely remain high. Opium poppy’s oil yield makes it a good feedstock for biofuels, and current production would supply all of Afghanistan’s diesel fuel demand and leave half available for export to Pakistan or elsewhere. Not only would this put a significant dent in the drug trade, it would have a notable impact on carbon-dioxide emissions through the displacement of fossil fuels and potentially create jobs along the supply chain. Nefarious actions by narcotraffickers and the construction of refineries notwithstanding, the international community would likely need to divert 10 to 25 percent of its aid funding from existing programs to opium poppy subsidies. Eventual replacement of narcotic-yielding poppies with alkaloid-free non-narcotic opium poppies or other feedstocks would likely be necessary to avoid relapse into the drug trade, but the raw feedstock and fuel demand makes this route a viable short-term option.

References

(1) Borrell, Brendan (2008): “Poppy power.” The Scientist, 22.3: 27

(2) Chisti, Yusef (2007): “Biodiesel from microalgae.” Biotechnology Advances, 25: 294-306

(3) EPA (2005): “Emission Facts: Average Carbon Dioxide Emissions Resulting from Gasoline and Diesel Fuel,” www.epa.gov

(4) Foreign Policy Magazine (2008): “In Box: Bizarre Biofuels.” 168: 12

(5) Grossman, Marc and Leeson, Robert (2008): “Disrupt Taliban power with switch to biofuel ways.” Canberra Times, July 1

(6) International Center for Agricultural Research in the Dry Area (2002): “Afghanistan Seed and Crop Improvement Situation Assessment.” April to May

(7) Phelps, Edmund and Del Castillo, Graciana (2008): “A strategy to help Afghanistan kick its habit.” Financial Times, January 3.

(8) Timmerman, Luke (2007): “Can biodiesel compete on price?” Seattle Times, February 17

(9) United Nations Office on Drugs and Crime (2009): “Afghanistan Opium Winter Assessment.” January: 1-42

(10) United Nations Office on Drugs and Crime (2005): “Summary Findings of Opium Trends in Afghanistan, 2005.” September: 1-26

(11) UN Data: www.data.un.org

(12) USAID Afghanistan: Budget and Obligations. www.afghanistan.usaid.gov

(13) Wikipedia (2009): Energy Content of Biofuel