The U.S. farm industry uses four to five billion gallons of diesel fuel per year — for farm equipment and transportation. If the dreams of researchers at the USDA Peanut Research Lab in Camilla, Ga., come true, peanut farmers could replace millions of gallons with biodiesel from peanut oil.

Peanut farmers in the U.S. historically produce approximately four billion pounds of peanuts per year. If every peanut grower produced 10 percent of their crop in low input, high yielding, high oil content peanuts, somewhere in the neighborhood of 200 million gallons of peanut biodiesel could be available to American farmers for about $1.60 per gallon.

The economic savings to U.S. farmers would be in the neighborhood of $160 million dollars per year.

As futuristic as that may sound, Wilson Faircloth, a research agronomist at the USDA Peanut Research Lab, has demonstrated at multiple sites that low input, high yielding peanuts can produce a ton per acre for surprisingly low input costs.

Research at the University of Georgia has pegged peanut biodiesel at 123 gallons per acre, based on state average yields, which are 500-600 pounds per acre higher than the low input peanuts in the USDA test.

Some researchers contend once better varieties are developed, along with more efficient conversion practices, production may reach 150 gallons per acre.

Currently, the primary oil used in the United States to make biodiesel fuel is soy oil, which regularly produces 50 gallons per acre, based on average national soybean yields per acre. Palm oil, canola oil, even used cooking oil are other sources.

The major stumbling block to converting peanut oil to biodiesel is the current high price of peanut oil. To be competitive with other biodiesel oil sources, Faircloth contends growers would need to look at a whole different way of growing peanuts and grow this crop separate from edible peanuts.

Biodiesel from peanut oil is compatible with fossil fuel-based biodiesel and can be mixed in any combination.

Compared to fossil-based biodiesel, there will likely be a 2 percent to 5 percent reduction in miles per gallon with either soy or peanut oil-based fuel, according Daniel Geller, a research engineer at the University of Georgia. Geller, who began working with peanut oil several years back, contends this is not significant and can likely be overcome by tweaking diesel engines.

In tests in his lab at the University of Georgia, Geller says peanut biodiesel is less toxic to the atmosphere and has a cleaning effect on diesel engines. He says peanut diesel can gel in the engine at temperatures as high as 50 degrees F, but the problem is easily fixed, and not likely to be a limiting factor in commercial use.

Peanuts and biodiesel go way back — to the beginning of diesel engines. German scientist Rudolph Diesel received a patent for his engine design in 1893. At the 1900 World's Fair, Diesel demonstrated his new engine powered by peanut biodiesel. Diesel noted at the World's Fair demonstration that his vision was that fuel for his engine would be grown in the area where the diesel powered vehicles would be used.

In the third year of low input tests, which expanded in 2007 to five sites from North Carolina to Florida, Faircloth looked at very low input costs for pest control and compared irrigated and non-irrigated peanuts.

Faircloth says growers can grow a ton per acre of peanuts for $175. The cost of shelling would be less than for edible peanuts and the cost for extracting the oil and making biodiesel would be minimal. Government programs have paid as much as a dollar per gallon for alternative fuel production, making the cost of raw materials for biodiesel less than a dollar per gallon on these low input peanuts.

“Peanuts will surprise you as to how much abuse they can take and still produce a reasonable yield. If used for biodiesel, peanut varieties that we now grow for flavor, color, kernel size and other positive traits won't matter. The key components of peanuts grown for oil are resistance to diseases, high yield potential, drought tolerance and high oil content,” Faircloth says.

The USDA researchers tested 19 different varieties, 13 of which were irrigated. A rye cover crop was planted to help with weed control on peanuts planted in early June. Glyphosate, Prowl and paraquat constituted pre-merge and early season weed control, followed by a half rate of Cadre and 2,4-DB later in the season.

The researchers added gypsum and due to an extremely dry planting season in 2006, Lorsban was added for insect control.

Irrigated peanuts in the combined tests yielded 2,200 pounds per acre. However, Faircloth points out the peanuts were under so much stress, irrigation didn't help too much, considering the dryland peanuts still averaged over 2,000 pounds per acre, over all varieties at all locations.

Georganic under irrigated conditions made nearly 3,000 pounds per acre using, the minimal input system. Georgia 03-L and Georgia 04-S, a Spanish type variety did well in the test. Georgia Green, the most popular runner variety currently grown in the Southeast was in the middle of the pack at about a ton per acre.

In 2006 the oil content in the varieties tested ranged from a high of 49 percent to less than 45 percent. Faircloth points out that in 2005 many of these same varieties produced five percent more oil, due to better growing conditions, compared to 2006.

Dryland peanuts in the test produced over 85 gallons of oil per acre, while irrigated peanuts produced over 100 gallons of oil per acre. Oil production, Faircloth explains is a function of yield, grade and oil content. Oil content is not static, he points out, noting that much research is needed to determine the optimum digging time to insure optimum oil content.

Georganic produced over 120 gallons of oil per acre under the severely reduced input system. Several varieties topped 100 gallons per acre and several of the varieties under dryland conditions nearly reached 100 gallons per acre.

The bottom line, Faircloth emphasizes is how much does it cost to produce a gallon of peanut biodiesel in these minimum input peanuts. Under irrigation Georganic was the most efficient at $1.75 per gallon. The average cost from all varieties was $2.38 per gallon.

On dryland peanuts GA-03L was the most cost efficient variety at $2 per gallon. In some varieties yields were so low that the cost per gallon topped $8. This is a clear indication, Faircloth says, that we need to be careful in choosing the right varieties and right production system to get maximum gallons per acre.

In a real-world situation Faircloth says peanut oil will most likely be used in a 50/50 blend with No. 2 diesel fuel. With a government subsidy of 50 cents per gallon and petroleum diesel fuel at $2.45 per gallon and peanut diesel at $1.75, the total cost of a gallon of blended diesel would be $1.60 per gallon, using the low input production system used in the USDA tests.

Even dryland peanuts, which cost $2.69 a gallon just for oil, once the tax credit applies, is more than 30 cents a gallon cheaper than diesel fuel. Faircloth points out that his equations include only a 50 cents per gallon subsidy and in some cases a dollar a gallon is available.

Faircloth says making peanut biodiesel is simple. Using the current infrastructure of shellers and adding oil extraction facilities, he says, would be relatively simple and inexpensive.

Though peanut growers do not want to devalue their crop, growing an oil crop and producing on-farm peanut biodiesel may be a viable way to cut down on-farm fuel costs.