The U.S. biofuel industry has long been stymied by the lack of USDA federal crop insurance, leaving only the most adventurous farmers willing to plant renewable energy crops.

Biofuel sources currently under development include algae, jatropha and camelina. Of the three, camelina is increasingly emerging as the frontrunner in attracting initial investment worldwide, as global demand for aviation fuel for passenger flights is now more than 40 billion gallons annually.

Camelina has a number of advantages over its competitors, including using far less water, thus allowing it to be grown on marginal land, thereby not taking food acreage out of production.

Furthermore camelina has a relatively short growing season of 80 to 100 days, requires no special equipment to harvest, and the silage remaining after processing can be fed to livestock and poultry, with the added side benefit of increasing their omega-3 production.

Now the U.S. Department of Agriculture has given camelina production a major shot in the arm by selecting 40 counties in Montana for a pilot program of federally backed camelina crop insurance. The counties covered are Big Horn, Blaine, Broadwater, Carbon, Carter, Cascade, Chouteau, Custer, Daniels, Dawson, Fallon, Fergus, Garfield, Glacier, Golden Valley, Hill, Judith Basin, Lewis and Clark, Liberty, McCone, Meagher, Musselshell, Park, Petroleum, Phillips, Pondera, Powder River, Prairie, Richland, Roosevelt, Rosebud, Sheridan, Stillwater, Sweet Grass, Teton, Toole, Treasure, Valley, Wheatland, Wibaux and Yellowstone.

Montana Governor Brian Schweitzer has long championed camelina as an ideal Montana green energy crop, commenting: "It's been my goal to help make Montana a leader in renewable energy. Through camelina our state has the potential to create jobs, reduce our dependency on fossil fuels and decrease carbon emissions."

Camelina is currently being grown in nine U.S. states plus four Canadian provinces. Montana's production now tops 80,000 acres, while trials are going on in 12 additional states and 37 more are considering production. The USDA program, to be overseen by the department's Risk Management Agency, will undoubtedly lead to a surge in Montana-based camelina production, as its politicians have long been in the forefront of promoting the plant.

Montana Democrat Senator Jon Tester got camelina insurance included in the 2007 farm bill with his Biofuel Crop Insurance Pilot Program initiative, which he inserted into the most recent Farm Bill, because he knew the crop wouldn't blossom in Montana unless it had the federal safety net of crop insurance. According the USDA's announcement the insurance will be available for the 2012 crop year. Following the USDA statement Tester said, "There's got to be a safety net.

You don't go into new crops unless you're independently wealthy or you have a safety net. Most farmers aren't independently wealthy. This initiative will provide jobs and opportunities for Montana farmers--while bringing our entire nation closer to energy independence through home-grown, renewable resources. I'm pleased the USDA is finally putting some muscle behind my camelina law and providing Montana farmers the chance to expand this promising resource and create jobs in the process. If I had a bit more time, I'd be growing oilseeds on my farm and investing in biofuels myself. This bill will open the door to a whole lot of opportunities for my neighbors-and for farmers all across Montana. Expanding biofuels in Montana is a win-win-win situation. It provides options and more job opportunities for farmers. It's responsible and sustainable development of a renewable resource. And it cuts back on our thirst for foreign oil, which will ultimately make our country more secure." Tester is one of only two farmers in the Senate.

The deadline for purchasing the insurance is 1 February 2012. Only spring-planted camelina grown under contract with a processor will be eligible for coverage against damage from adverse weather, fire, wildlife, earthquake, volcanic eruption and insect and plant disease. The insurance will not provide compensation for any losses attributed to insufficient or improper application of pest or disease control measures.

Great Plains Oil and Exploration-The Camelina Co. President Sam Huttenbauer said, "This is a critical step toward camelina becoming a major U.S. biofuel crop and a huge help for the farmers of Montana and North Dakota. We greatly appreciate the assistance of the senators in Montana, in particular Jon Tester who paved the way for this crop with his work to get this program into the farm bill."

National Farmers Union President Tom Buis added, "Renewable energy production is one of the most exciting opportunities in our rural communities. I commend Senator Tester's foresight in introducing this legislation. Public policy can and should encourage innovation and diversification of both our food and fuel supplies."

Among the customers lining up for camelina JP-8 aviation fuel will be the U.S. armed forces, which have spent the last two years extensively testing camelina's suitability, with the U.S. Air Force earlier this certifying camelina biofuel for use in its fleet of Globemaster transport aircraft. Given that the new federal crop insurance will undoubtedly boost camelina feedstocks for biofuel refineries, the Pentagon can look to Montana as a major supporter in its efforts to go "green."

Source: http://oilprice.com/Alternative-Energy/Biofuels/U.S.-Biofuel-Camelina-Production-Set-to-Soar.html

By. John C.K. Daly of Oilprice.com