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Jatropha (Jatropha curcas) is a non-edible oil producing plant which is being advocated as an alternative biofuel energy resource. Its ability to grow in diverse soil conditions and minimal requirements of essential agronomical inputs compared with other oilseed crops makes it viable for cost-effective advanced biofuel production. We designed a study to investigate the effects of elevated carbon dioxide concentration ([CO2]) (550 ppm) on the growth, reproductive development, source-sink relationships, fruit and seed yield of J. curcas. We report, for the first time that elevated CO2 significantly influences reproductive characteristics of Jatropha and improve its fruit and seed yields. Net photosynthetic rate of Jatropha was 50% higher in plants grown in elevated CO2 compared with field and ambient CO2-grown plants. The study also revealed that elevated CO2 atmosphere significantly increased female to male flower ratio, above ground biomass and carbon sequestration potential in Jatropha (24 kg carbon per tree) after 1 year. Our data demonstrate that J. curcas was able to sustain enhanced rate of photosynthesis in elevated CO2 conditions as it had sufficient sink strength to balance the increased biomass yields. Our study also elucidates that the economically important traits including fruit and seed yield in elevated CO2 conditions were significantly high in J. curcas that holds great promise as a potential biofuel tree species for the future high CO2 world.