IMPACTS OF SUBSTITUTING PLANT OILS FOR DIESEL FUEL

A regional field crop and national livestock econometric model (TECHSIM) is used to examine the impacts of diverting plant oils (cottonseed oil and soybean oil) to use as a diesel fuel replacement. Two scenarios which represented a five and ten percent replacement of agriculture's diesel fuel use (1979) by plant oils are simulated for the period 1982-90. Results show that producers shift into cotton and soybean production and out of corn, small grains, and grain sorghum. Significant price shifts are observed for oilseeds and their meal and oil products. The annual net reduction in monetary measures of welfare is estimated at about $0.5 billion and over $1 billion for replacement of five and ten percent, respectively, of agriculture's diesel fuel use by plant oils