Over the past few years, agriculture has been a hot center of attention and rightly so. In my line of work, I am always interested in finding new and innovative ways of growing production more efficiently, more sustainably and in a way that offers viable jobs and attractive livelihoods. Recently, I got acquainted with Mr. Sreenivas Ghatty, from India, and Dr. John Wightman, from Australia. They both are involved in the production of tree oils for the production of a renewable alternative to diesel oil. Mr. Ghatty founded Tree Oils India Ltd and owns a plantation of 3,000 oil trees. Dr. Wightman is actively promoting the development of similar projects in Australia, USA, Africa and South Asia. The story of the tree oil interested me right away for several reasons. First, it reminded me of the Sahara Forest Project that I had mentioned in Future Harvests, but with this difference that the tree oils projects are already there. Secondly, and more importantly, it is a great example of a project that can generate many economic activities, while filling an environmental and social function by calling upon a collaborative approach like what I discussed in We Will Reap What We Sow. As several projects have already reached the production stage, the gentlemen have the numbers to present a case to interested investors.
In India and Australia, the species farmed is Pongamia. It is an indigenous tree to India that used to provide oils for various applications, of which fuel. However, with the rise of cheap fossil fuels, its use regressed to some extent but in the second half of the 20th century, the Mumbai commodity market traded one million tonnes of Pongamia oil per year. The purpose of this production is to develop land that would otherwise have no agricultural use, because of the arid climate. Some of the current projects are aimed at using waste lands around former mines, as is already the case in some parts of Queensland in Australia. It is a way of regenerating a landscape and agricultural production by fixing carbon and producing a renewable fuel that emits less greenhouse gases than fossil fuel. Pongamia is a rustic species that is well-suited in such regions. To understand what this production can create, it is important to put it in a broader context than oil alone, and that is why I find it particularly interesting.
It takes the Pongamia tree four years to start producing its oil-rich seeds and once in production, it will keep producing at a steady level for a hundred years or more. To give an idea of the production potential, a conservative yield estimate that Mr. Ghatty and Dr. Wightman gave me was of 1,000 liters per acre of Pongamia plantation. Although the harvest is not all year-round, the seeds can easily be stored and the oil production capacity can be organized evenly all through the year to optimize the oil production capacity. The oil is suitable for diesel engines without any particular further refining. The oil provides a source of fuel to run the farms and when acreage is large enough, it could cover the needs of local communities, too. The by-products from the oil production, such as the seed cake that is of good agronomic value, can be used as a fertilizer or mulch to return to the land, and thus enrich it as production goes. They can also be used as fodder for cattle, as a complement for other feed sources.
Next to storing oil in its seed, Pongamia is a tree legume, and therefore it can fix nitrogen and help enrich the soil where it grows. It also has nematicide and fungicide qualities. Pongamia production can be the basis for a multi-level and complex agricultural activity. With its agronomic qualities, Pongamia is quite suitable for an agro-forestry production system. The combination of the shade provided by the trees with soil enrichment by nitrogen fixing and seed cake fertilizer and the moisture retention that results from these new local conditions creates a suitable environment for the production of vegetal crops for food production. For instance, on the Tree Oils India Ltd farm, they grow pigeonpea between the Pongamia rows. Further development of optimal combination and rotation of crops will be enhanced as the system will enrich itself over time. It is also possible to combine the tree plantation with extensive grazing cattle. The Pongamia plantation helps the production of grass and in return the cattle fertilize the soil with manure.
The combination of the various possible productions also offers different possibilities of cooperation. Not all activities need to be done by the same farmer. There is always the possibility to offer land for use for vegetal crops or grazing. The partners can decide of which form the cooperation can work, between ownership, renting, sharing of land or of harvest or any other form that can create a harmonious cohabitation. Such different possibilities allow the integration of local rural communities to access production potential as the plantation creates the condition and the potential for both vegetal and animal productions such as meat, milk or wool. By generating different farming activities, the Pongamia production has the potential to create several agricultural value chains for all the productions involved as well as processing, storage and marketing. It can have a snowball effect beyond simply agriculture. When the local communities develop livelihoods, they also will need access to other products and services to function. The combination of all these activities allows creating sustainable production systems, as all the products and by-products can be used locally and thus, closing the loops. However, the system does not have to be a closed one. Productions can be used locally or sent to markets elsewhere, and the same is true for inputs, but integrating all the activities allows monitoring and managing the production systems in a sustainable manner. Closing loops is a key phrase in regard to such integrated production systems. In this case, the loops cover carbon, nutrients, moisture and organic matter.
Like many economic development projects, a leading project is necessary to create the necessary momentum upon which other activities can connect and grow along. Pongamia production has this potential but as always for such projects, the need for investment is critical in the early stages. It must start somewhere and the return is not immediate. There is always a chance to take. Because it takes several years for the Pongamia tree to enter production, the early years do not generate revenue from oil, and only the crops generate income. However after the trees start producing, income increases substantially. Over a period of ten year after planting the trees on the plantation, the return allows farmers to have a good income. Economic development requires long-term commitment from the shareholders. As many activities and also economic benefits are the objectives, all stakeholders that can benefit in the long term should also be shareholders. Success cannot be the responsibility of the plantation investor alone. When stakeholders are shareholders, they become owners of the project as well; and owners are more determined than spectators to turn a project into a success. Many jobs can be created in farming, in different activities of oil processing, logistics, trade, and in the different activities of the different value chains that can spin off from Pongamia. It is also not just a matter for businesses only, but governments also would benefit. More economic activity means more taxes down the road, as well as less need for financial support of rural communities once they can generate a solid local economy.Every project would have to adjust to the local conditions. If the projects in India and Australia are developed on mining grounds, other regions may offer different types of land for development. The available land might decide the size of the plantations and the production volumes. From there, each project will have to list the potential other activities that can be combined with the plantations, and how many jobs in which activities may be created. By reviewing the entire production potential with the socio-economic potential, it will give clarity to the different stakeholders of what their individual return would be. Then, they can determine how big a share of the project they want or how much they can contribute to the development of such integrated activities. If, for now, tree oil projects are more advanced in India and in particular in Australia, they certainly could be quite instrumental to help develop economic development in particular in arid parts of Africa. It is possible as a number of success stories with agro-forestry have already demonstrated there. This type of integrated agriculture has good potential to recreate productive vegetal landscape in former deforestation areas like for instance in Brazil.
If you wish to know more about Pongamia oil, feel free to contact Dr. John Wightman or Mr. Sreenivas Ghatty
(Photos: courtesy of Mr. Sreenivas Ghatty and Dr. John Wightman)