Supply chain for crop residue

management

Prepared by Nishant Chaudhary, Innovation Centre for Agri-waste Management

CCS Haryana Agricultural University, Hisar
 Outline

• Crop residue generation in India

• Stubble burning

• Utilization of straw

• In-situ vs ex-situ management

• Model value chain for rice straw management

• Viability of ex-situ management strategies:

• 2G Ethanol

• CBG

• Pelletization

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 Crop residue generated in large quantities

• Around 500 million tonnes (Mt) residue of different crops produced annually; majority
used as fodder, fuel and in various industrial processes 1,5

• 141 Mt surplus residue available

• Out of this surplus 87 Mt crop residue burnt!

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 Crop residue a BURNING issue!

• Several negatives of crop residue burning:

• Crop residue burning emits SOx, NOx, NH3, and volatile organic compounds (VOCs)
which are precursors for the formation of particulates in the atmosphere2

• More than 8.5 Mt of carbon monoxide emitted due to crop residue burning 2

• Seasonal burning (particularly during first 10 days of November) of crop residue in

fields contribute 30-35% of PM10 concentration in Delhi3

• Detriment on soil organic carbon and fertility including reduction in long term
productivity4

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 Crop residue a BURNING issue!

Majority pollution caused in the Indo-Gangetic Plain in states of Punjab, Haryana (Rice and
Wheat), Uttar Pradesh (Rice, Wheat and Sugarcane), followed by pockets in Maharashtra, Tamil
Nadu (Sugarcane) and West Bengal (Rice) 5

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 Utilization of straw – pattern changed over the years

• From 1997 to 2007, data from Punjab suggests there has been a shift from selling straw and using for
households consumption to disposing off through burning 6

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 Utilization of straw – pattern changed over the years

• From 1997 to 2007, data from Punjab suggests there has been a shift from selling straw and using for
households consumption to disposing off through burning 6

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 Rice straw – why is it burnt and current policy measures to prevent burning

• Why burning?
• Lack of manual labour
• Rapid uptake of combined harvesters that harvest the rice grain but leave straw in the field
• Short timeframe between rice harvest and wheat sowing

Approaches to utilize residue

In-situ: Ex-situ:

- Mulching: Happy Seeder - Bioethanol and CBG: MoP

support use of crop residues
- Central scheme from MAFW to produce 2G ethanol and
(2018): Financial assistance CBG
for procurement and hiring in- - Biomass pelletization: NTPC
situ crop management to use pellets made from crop
machinery; IEC activities to residue to co-fire thermal
promote awareness7 power plants

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 Post harvest ex-situ residue management

• Ex-situ – residue collected and transported from field to be used as feedstock for fuel in
industries, power plants and packaging materials

• Potential utilities:
• Electricity generation
• Pelleting and Briquetting
• Torrefaction and Biochar
• Biorefineries
• Bio-Ethanol Production
• CBG

• To effectively scale up use of crop residue for ex-situ purposes, there is a need to develop
value chain of residues that can enable collection, mobilisation, storage of residue in an
economically viable way.

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 Model value chain for rice straw management6

Preprocessing and
temporary storage Storage/sale

Harvesting and Aggregation

Transport Collection Centre Transport
Baling Centre
15 km radius 30 km radius

Model supply chain consists of three major

steps:
i. Harvesting and baling rice straw Energy/fuel
Industrial Uses Compost
producers
ii. Transport to temporary collection
centres
iii. Transport to and storage at aggregation
Construction Handicraft
centres boards producers

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 Model value chain for rice straw management – processes at each step 6

Transport bales using trailer

Transport bales on large
attached to tractor to a
cargo trucks to aggregation
temporary collection point
centre
near road

Collection Centre Aggregation Centre

Harvesting and Baling Transport (Temporary Storage) Transport (Storage and wholesale)
15 km radius 30 km radius

- Collecting the bales from - Storage of bales

- Raking of straw into lanes different fields temporarily - Covered with plastic sheets
- Baling straw into small/medium square bales - Stored on a raised platform
small/medium square bales - Loading bales to a large - Well ventilated warehouse
- Loading bales onto trailer cargo truck to transport to - Acts as whole sale point
aggregation centre

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 Model value chain for rice straw management – basis for analysis 6

LOGISTICAL AND
BIOMASS ASSESSMENT
ECONOMIC ANALYSIS

- Which residues are produced? - How to harvest and collect

- Spatial distribution of
residues
- Production, availability and
accessibility of residues
- Current and competing uses
of residues
residues?
- How to store residues?
- How much storage capacity is
required?
- Cost of developing value chain
and related infrastructure

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 Model value chain for rice straw management – analysis for state of Punjab 6

- Estimated total rice straw production in Punjab (2020) – 25.17 Mt

- Current usage of this rice straw:
- Bioenergy plants – 1 Mt
- Paper/Cardboard mills – 2.7 Mt
- In-situ management – 3.52 Mt
- Total used – 7.22 Mt

- Ministry of Agriculture and Farmer Welfare suggests that around 70% of rice straw
produced should be managed in-situ, while remaining 30% could be managed ex-
situ

- Based on this 30% number, a total of 7.55 Mt of rice straw could be available in
Punjab for ex-situ management (spatial distribution analysed across districts)

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 Model value chain for rice straw management – analysis for state of Punjab 6

Cost of Collection

Operational
Capital Expenditure Other Costs
expenditure

- - General and
Labor - Equipment
- Energy administrative
- Building and - Unforeseen labor
- Electricity installation - Compensation to
- Depreciation and
maintenance farmer

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 Model value chain for rice straw management – analysis for state of Punjab 7

- Total collection cost at 30% straw collected – INR 703/tonne

- Size 2 bales (36 x 24 x 12 inches) result in lowest cost of collection
- Analysis based on collecting straw in 20 days

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 Model value chain for rice straw management – analysis for state of Punjab 7

- Market price determines profitability for entrepreneur which in turn determines farmer incomes

- Market still very nascent so prices vary greatly

- A 2021 survey by FAO reports that average selling price was INR 1500/tonne; prices on Indiamart

vary from INR 2000/tonne to INR 8000/tonne

- Relationship between market prices and farmer’s incomes:

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 Viability of ex-situ strategy – 2G ethanol production

• India’s Bioenergy policy mandates 20% blending of ethanol and petrol by 20258
• Based on current consumption trends, India will need to produce 9 billion litres of ethanol
by 2025 to meet E20 blending target; focus needs to shift from 1G to 2G ethanol 6

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 Viability of ex-situ strategy – 2G ethanol production6

• High capital cost – ranging from over INR 250 Cr for 5 million litre plant to over INR 1600
Cr for 100 million litre plant

• Major production cost heads for 2G ethanol – chemical inputs (30%) and feedstock costs
(25%)

• Current price for sale to OMCs will be based on 1G ethanol derived from 100% sugarcane
juice – INR 62.65/litre9

• Analysis suggests production capacity of atleast 93 million litres per year needs to be
achieved for profitability
• Production cost: INR 38/litre
• Selling price: INR 62.65/litre

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 Viability of ex-situ strategy – 2G ethanol production6

• At current selling price, viability is limited – either increase the selling price or provide
financial support to entrepreneurs to reduce overall capital costs

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 Viability of ex-situ strategy – CBG production

• Ministry of Petroleum and Natural Gas has scheme called Sustainable Alternative Towards
Affordable Transportation (SATAT) which plans to roll out 5,000 CBG plants by 202410

• Target to produce 15 million tonnes of CBG by 202310

• Current minimum market price of CBG at OMC companies is INR 46/kg; digestate also a
source of revenue (estimated INR 3.3/kg)

• However, considering all costs and all sources of revenue, a CBG plant would need to have
production capacity 12,000 m3 per day to be profitable

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Viability of ex-situ strategy – CBG production

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 Viability of ex-situ strategy – CBG production6

• At current selling price (with selling digestate), CBG production is viable in almost all districts
of Punjab

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 Viability of ex-situ strategy – pelletization

• In 2020, 50% of country’s electricity supply comes from burning coal (MoP, 2020)

• To reduce coal dependence due to its high GHG emissions and pollution, Ministry of Power
launched Mission Samarth to mandate 5-10% co-firing of biomass in all coal-fired thermal
power plants11

• In May 2022, NTPC invited EoI from Indian startups to produce torrefied pellets (closer to
coal with higher energy density) – 5 million tonnes of pellets are expected to be used per
year across 17 power plants11

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 Viability of ex-situ strategy – pelletization

• If 30% of straw used for pelletization, 7.1 million tonnes of pellets could be produced (143%
of NTPC target)6

• Capital cost can vary from INR 4 Cr at 4 kg/hour production to INR 713 Cr at 4000 kg/hr
production

• At a market price of INR 7/kg, breakeven capacity should be around 130 kg/hr

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 Viability of ex-situ strategy – pelletization

• At market price of INR 7/kg, pellet products seem profitable in all districts of Punjab

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 References

1. Datta, A, M A Emmanuel, N K Ram and S Dhingra. 2020. Crop Residue Management: Solution To Achieve
Better Air Quality. New Delhi: TERI
2. Jain, N., Bhatia, A., Pathak, H. (2014) Emission of air pollutants from crop residue burning in India. Aerosol
and Air Quality Research 14: 422–430
3. PTI (2019a). According to the Ministry of Earth Sciences’ air quality monitor SAFAR, smoke from stubble
burning in Punjab and Haryana accounted for 44 per cent of pollution in Delhi on November 1, the highest
this year.” Details available at https:// www.business-standard.com/article/pti-stories/ stubble-burning-
contributed-significantly-todelhi-ncr-s-pollution-this-year-cpcb-membersecy-119111301401_1.html; last
accessed on 24 January 2020
4. Hesami, Einollah & Talebi, Ali & Hesammi, A. (2014). A review on the burning of crop residue on the soil
properties. WALIA journal. 30. 192-194.
5. TERI [The Energy and Resources Institute], 2021 Development of Spatially Resolved Air Pollution
Emission Inventory of India.
6. FAO. 2022. Establishing residue supply chains to reduce open burning. The case of rice straw and
renewable energy in Punjab, India. Environment and Natural Resources Management Working Paper No.
95. Rome. https://doi. org/10.4060/cb9570en

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 References

7. Operational guidelines for central sector scheme on ‘Promotion of Agricultural Mechanization for In-situ
Management of Crop Residue in the States of Punjab, Haryana, Uttar Pradesh and NCT of Delhi’, Ministry
of Agriculture and Farmers Welfare, 2020
8. https://www.business-standard.com/article/current-affairs/petrol-blended-with-20-ethanol-to-be-rolled-out-fr
om-april-1-puri-123011001050_1.html
9. Zhou et al., Techno-economic analysis of cellulosic ethanol in india using agricultural residues, The
International Council on Clean Transportation, June 2021
10. https://satat.co.in/satat/about.html
11. https://economictimes.indiatimes.com/industry/renewables/ntpc-seeks-startups-to-produce-torrefied-bioma
ss-pellets/articleshow/91233239.cms?from=mdr

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