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Francis M. Epplin is Charles A. Breedlove Professor of Agricultural Economics at Oklahoma State University, Christopher D. Clark is Assistant Professor and Roland K. Roberts is Professor at the University of Tennessee, and Seonghuyk Hwang is a graduate research assistant at Oklahoma State University.

The authors acknowledge the assistance of personnel of the Biobased Products and Energy Center at Oklahoma State University. This article benefited from comments provided by B. Wade Brorsen and Jeffrey Vitale. Remaining errors are the responsibility of the authors. Research supported by the Oklahoma Agricultural Experiment Station, Project H-2574, by USDA-CSREES Special Research Grant award 2005-34447-15711, by the Tennessee Agricultural Experiment Station, Project TEN00256, and the U.S. Department of Energy through the Tennessee Switchgrass Project GO14219.

This article was presented in a principal paper session at the AAEA annual meeting (Portland, OR, July 2007). The articles in these sessions are not subjected to the journal's standard refereeing process. Table 1. Estimated Costs, Number of Harvest Machines, Average Investment in Harvest Machines, Acres and Tons Harvested to Provide a Flow of Switchgrass Feedstock to a 2,000 Dry Tons per Day Biorefinery for Both a Two- and Eight-Month Harvest Season

Model Results Category Eight-Month Two-Month

(a) (b) Costs

Land rent cost ($/ton) 10.77 9.74

Field cost ($/ton) (c) 9.23 8.35

Harvest cost ($/ton) 16.30 33.09

Field storage cost ($/ton) 0.58 1.57

Total cost other than

transportation ($/ton) 36.88 52.75

Transportation cost ($/ton) 12.00 12.54

Total cost of delivered

feedstock ($/ton) 48.88 65.29 Other results

Harvest units for mowing (number) (d) 47 136

Harvest units for

raking-baling-stacking (number) (e) 19 56

Average investment in harvest

machines ($,000) 10,777 26,726

Harvest acres 128,665 119,657

Total biomass harvested (tons) 716,635 736,741 (a) The eight-month harvest season extends from July through February. (b) The two-month harvest season includes only July and August. (c) Field cost includes amortized establishment, maintenance, and fertilizer costs. (d) A harvest unit for mowing includes one worker, one mower, and one tractor. (e) A harvest unit for raking-baling-stacking includes seven workers, three rakes, three balers, six tractors, and one transport slacker. Table 2. Tennessee Farmer Bids to Produce, Harvest, and Collect Switchgrass

Base

Minimum Maximum Bid Bidder (a) Acres Acres ($/acre) 1 70 100 $200.00 2 10 20 $250.00 3 8 15 $225.00 4 10 50 $200.00 5 12 30 $250.00 6 20 100 $255.05 7 10 50 $250.00 8 10 20 $255.34 9 16 16 $200.00 10 10 15 $62.00 11 10 20 $900.00

Total per

Incentive Acre Bid

Bid (5.5 t/a) (7 t/a) Bidder (a) ($/ton) 1 $7.50 $241.00 $253.00 2 $0.00 $250.00 $250.00 3 $20.00 $335.00 $365.00 4 $30.00 $365.00 $410.00 5 $25.00 $388.00 $425.00 6 $25.00 $393.00 $430.00 7 $30.00 $415.00 $460.00 8 $30.00 $420.00 $465.00 9 $50.00 $475.00 $550.00 10 $110.00 $667.00 $832.00 11 $30.00 $1,065.00 $1,110.00

Average Bid

per Ton (b) Acres Bidder (a) (5.5 t/a) (7 t/a) Awarded 1 $43.86 $36.07 0 2 $45.45 $35.71 15 3 $60.91 $52.14 15 4 $66.36 $58.57 30 5 $70.45 $60.71 12 6 $71.37 $61.44 20 7 $75.45 $65.71 0 8 $76.43 $66.48 0 9 $86.36 $78.57 0 10 $121.27 $118.86 0 11 $193.64 $158.57 0 (a) Farmers whose bids were accepted were contracted to seed switchgrass, fertilize, control weeds, harvest once per year, and collect harvested bales. Seed was provided and farmers were required to load but not transport the bales off the farm. (b) Weighted-average of the accepted bids is $63.69 assuming an actual yield of 5.5 tons per acre and $54.70 assuming an actual yield of seven tons per acre.