Abstract:
Tanzania is among the countries which depend entirely on imports for their crude oil
requirements. This dependence on imported oil requires a lot of foreign currency. This
dependence on imported crude oil necessitates looking for alternative sources of energy.
The present study aims to assess the economic potential of biodiesel production among
small scale farmers. The study was conducted in Arusha region, in northern Tanzania.
Two Districts namely: Meru and Monduli were purposely selected basing on jatropha
production in these areas. A cross sectional survey was conducted to collect primary data
from 120 households. Secondary data were secured from Meru and Monduli Districts,
SNAL and internet sources. Descriptive and quantitative analytical techniques were used.
The findings show that the profit accrued from Jatropha production was the smallest
compared to other crops in the study area. Black bean has the largest margin, followed by
coffee, maize, beans, banana, and lastly Jatropha. Cattle contribute 78% while 9.1% from
goats and sheep and 3.8% from chicken to the household income. The factors such as
extension services and price influence profitability of Jatropha production and were
statistically significant (PO.Ol). The smallest of costs of producing biodiesel by using
Jatropha as a feedstock is TZS 1469 to be competitive with landed oil price of TZS 1120
per litre. The current landed oil prices of around TZS 1120 a litre requires biodiesel
production costs to be around TZS 1469 a litre for the production of biodiesel to be
profitable in the country. This study recommends Jatropha production on contour and
fences.
