Abstract Farming operations in Africa have, in general, not adopted small-scale biodiesel production technology well for on-farm fuel usage. This is mainly due to the lack of an acceptable method to assess the economic feasibility of constructing small-scale biodiesel production facilities, and the impact of such operations on existing farming production processes. The research study summarised in this paper subsequently set out to develop a model, termed the Biodiesel Production System Optimisation Model (BPSOM), which predicts the cost of producing biodiesel on a small-scale, and optimises on-farm production processes to maximise profits. The model was validated using a South African case study to evaluate the predicted cost of biodiesel per litre produced, and the economic impact of a small-scale facility on the production profits of a farm. A proxy indicator, profit per hectare cultivated land, is introduced to measure the impact. BPSOM predicts a positive profit increase of 33% for the specific farm case study, which proves the economic potential of small-scale biodiesel production facilities for fuel usage at farm level in Africa.