WINCHESTER — Farmers have been hearing for 10 years that switchgrass will overtake corn as the main fuel for ethanol. But there’s still no market. Now a Winchester-area company is processing switchgrass — but not for ethanol.

Dave Hendrick of Hendrick Seeds has started a new company, Switchgreen, with Seeley’s Bay crop farmer Charlie Foreman, to process switchgrass to make fuel pellets for wood stoves and commercial boilers.

"The market is still in its infancy," notes James dePater, ceo of Hendrick Agri-Foods, yet another Hendrick creation, this one focussing on the core business, soybean exports.

About 500 acres are grown in eastern Ontario and another 500 in western Ontario.

So far, switchgrass is not an easy sell to consumers. It can’t be used in most stoves and there is no cost advantage. The market taps into the "buy local" trend, dePater said. In this case, it’s local fuel.

On the upside, there are some big advantages to growers. Here are four:

1. You seed once "This is a perennial plant," dePater said. You have to wait until the second year in the fall to get your first cut. But you don’t harvest until the following spring.

"There are no known problems with disease or pests," dePater said. "Most growers are not applying fertilizer to the crop when it is established. So your inputs are much lower than an oilseed crop."

3. You can grow switchgrass on marginal land.

You don’t need prime land and you don’t need tile drained land, he said.

4. Yields are high.

Expect 5.5 to 6.5 metric tonnes per acre.

But how much can I earn? "I hear from growers that switchgrass would go on land where you would normally grow hay," dePater said. The market hasn’t firmed up the price but he said that inquiries he has made across North America show that switchgrass sells for $75 to $100 per metric tonne. As an example, he said that if you produce six tonnes on one acre at $80 per tonne you would gross $480. "At $70 of $80 per tonne switchgrass makes a lot of sense as it would outperform hay. And after year one there are no inputs and no replanting. Your inputs are little or zero."

As it stands, Switchgreen will buy as much switchgrass as they can get their hands on. They’re hoping long term that eastern Ontario will increase crop production from 500 acres to 5,000 acres. They expect to see 800 acres of switchgreen this year, dePater said. But to make this profitable, a farmer needs to be within 50 miles of Hendrick’s Inkerman farm. Noted dePater: "Interest is very high. We’re getting a lot of inquiries."

Roger Samson, executive director of Resource Efficient Agricultural Production, an agency at McGill University in Montreal, has been following industry trends. He says that there will be a huge market for switchgrass fuel pellets in Europe within a few short years. Wood pellet demand is growing by 25 to 30 per cent per year but wood residue supplies are dwindling fast because the pulp and paper mill industry collapsed a few years ago, he said. The cost of cutting trees to create pellets is too high, he said.

The European wood pellet market has three more years, Samson said. "After that they will hit the wall."

As it is much easier to use grasses "this has the potential to be a large market," he said. "David Hendrick and company are going to have a pretty interesting market. The only question is are they too early or are they on time? We’ll find out."