IDEAS home Printed from https://ideas.repec.org/p/ags/huaedp/42831.html
   My bibliography  Save this paper

Economic Efficiency of Compost Production: The Case of Israel

Author

Listed:
  • Kan, Iddo
  • Ayalon, Ofira
  • Federman, Roy

Abstract

This paper presents a comprehensive economic analysis of recycling organic wastes through composting. A mathematical programming model is developed to examine the optimal level of compost production from sources of organic municipal solid waste, livestock manure and wastewater-treatment sludge. The model incorporates the spatial nature of the problem by referring to the locations of the sources for raw organic matter, of the composting plants and agricultural regions. Agricultural demand for compost is derived using estimated production functions for 42 crops, price elasticity of the vegetative agricultural outputs, and farmers' stated willingness to utilize compost. The model accounts for the costs of waste collection, compost production, transportation and landfilling; all include both direct costs and externalities. The optimal allocation of raw materials and outputs is achieved when the financial contribution of the composting system is maximized relative to the alternative of disposing of these organic wastes in landfills. We apply the model to the case of Israel. Today, despite the relatively high levels of organic material in municipal solid waste, the scarcity of landfill sites, and the low level of organic content in agricultural soils, only 37% of Israel's composting potential is realized. Subject to compliance with new environmental regulations, our analysis points to the possibility of an 89% composting rate, in which all livestock manure and sludge are composted, but only 75% of the organic municipal solid waste is utilized in this manner. This finding supports the strict enforcement of these environmental regulations, and indicates the need for a composting encouraging policy. However, regulations aimed at increasing the rate of municipal solid waste recycling should leave enough freedom for municipalities to select their waste disposal strategies. It is also concluded that, given the high costs of separating municipal waste at the 2 source, the government can increase composting rates by initializing and stimulating the formation of regional cooperation to ensure steady long run consumption of raw organic materials. Moreover, the government can increase agricultural demand for compost by both setting clear standards for high quality compost, and spreading the scientific information on the advantages of composting via the governmental agricultural instruction system. The presented methodology is applicable to other cases, as is the scientific-based data, which include the external costs and the compost production functions. This information is relevant for regions facing the same challenges, particularly where the soil's organic content is less than 2%; e.g., Portugal, Spain, Italy and Greece.

Suggested Citation

  • Kan, Iddo & Ayalon, Ofira & Federman, Roy, 2008. "Economic Efficiency of Compost Production: The Case of Israel," Discussion Papers 42831, Hebrew University of Jerusalem, Department of Agricultural Economics and Management.
  • Handle: RePEc:ags:huaedp:42831
    as

    Download full text from publisher

    File URL: http://purl.umn.edu/42831
    Download Restriction: no

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:huaedp:42831. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search). General contact details of provider: http://edirc.repec.org/data/agrhuil.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.