Assessing the Different Economic Feasibility Scenarios of a Hydroponic Tomato Greenhouse Farm: A Case Study from Western Greece

Efstratios Michalis, Christina-Eleni Giatra, Dimitrios Skordos and Athanasios Ragkos ()
Additional contact information
Efstratios Michalis: Agricultural Economics Research Institute, Hellenic Agricultural Organization—DIMITRA, Kourtidou 56-58, 11145 Athens, Greece
Christina-Eleni Giatra: Agricultural Economics Research Institute, Hellenic Agricultural Organization—DIMITRA, Kourtidou 56-58, 11145 Athens, Greece
Dimitrios Skordos: Agricultural Economics Research Institute, Hellenic Agricultural Organization—DIMITRA, Kourtidou 56-58, 11145 Athens, Greece
Athanasios Ragkos: Agricultural Economics Research Institute, Hellenic Agricultural Organization—DIMITRA, Kourtidou 56-58, 11145 Athens, Greece

Sustainability, 2023, vol. 15, issue 19, 1-14

Abstract: Among other agricultural systems that can contribute to sustainable food production, hydroponic systems are constantly gaining attention in terms of their economic viability and sustainability, while their ability to produce nutritious food has become more apparent in recent decades. The purpose of the study is to shed light on the potential of hydroponics to conduce sustainable food production systems, by focusing on the economic evaluation of a hydroponic greenhouse farm located in Western Greece. Particularly, the study aims at presenting an investment plan for a greenhouse farm of a total acreage of 0.2 hectares, where fresh tomato will be produced via hydroponic methods. The appraisal of the economic viability of the investment plan covers a 5-year period, while the Net Present Value (NPV) and the Internal Rate of Return (IRR) are used as criteria of feasibility and performance assessment. The study uses detailed technical and economic data—related to all costs and benefits deriving from the annual operation of the greenhouse farm—to assess three different economic feasibility scenarios based on the range of input, energy and product prices, taking into account the high volatility governing agricultural markets. The results show that economic viability is achieved during the 5-year assessment period in most scenarios, which is mainly due to the efficiency of the hydroponic systems. Investment performance indicators are adverse only for an “extreme” scenario with increased installation and production costs that are not counterbalanced by higher product prices or by financial support from the State. Despite the promising perspectives of hydroponics in Greece, its use is not yet widespread within the country. Further research should explore ways to increase adoption of such production methods, considering that immediate action is needed worldwide to improve the resilience of the food industry and promote environmentally friendly food production systems.

Keywords: hydroponic tomato; greenhouse farming; investment plan; SWOT analysis; CBA analysis (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.mdpi.com/2071-1050/15/19/14233/pdf (application/pdf)
https://www.mdpi.com/2071-1050/15/19/14233/ (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gam:jsusta:v:15:y:2023:i:19:p:14233-:d:1248151

Access Statistics for this article

Sustainability is currently edited by Ms. Alexandra Wu

More articles in Sustainability from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().