XL Renewables Predicts $10,000/acre Profit from Algae
In an article published in Western Farm Press, XL Renewables’ President Ben Cloud stated that farms that utilize his company’s “Super Trough System” to grow algae could expect returns as high as $10,000 per acre.
Today, Cloud is quick to share his math calculations on the potential profits from algae.
“A 160-acre algae farm utilizing the Super Trough System would have a capital cost range of $5 to $7 million, with annual algae yields of about 50 tons or more per acre, and significantly higher returns than any other crop,” he says.
“Gross income range with the Super Trough is about $25,000 an acre; operating costs would average about $15,000 an acre. The bottom line is $10,000 net per acre, which is very attractive.”
Implemented in 40-acre units, the Super Trough operates as an open or closed system, depending on the climate, algae specie, and application. Troughs are five-feet wide and 18 inches deep.
This is by far the highest profit margin I have seen yet for algae production. Regretfully, the article doesn’t go into what the algae grown will be sold to produce. I highly doubt that algae grown for strictly biofuel use would garner such high profits. However, selling the algae for other uses like nutraceuticals or chemicals might explain the seemingly exceedingly rosy prediction for profits.
Even if these profit predictions have been reached by calculating the price of non-biofuel products from an acre of algae, the seemingly high rate of return would help buttress the sale of algae for biofuels as well.
It will be interesting to see if these profit predictions come true. If they do, algae biofuel might be on the market sooner than everyone expected.
