Economic viability of irrigated and densely planted forage palm production in the semi-arid region of Rio Grande do Norte

Suênia Flávia de Araújo Dantas, Guilherme Ferreira da Costa Lima and Edson Pereira da Mota

Revista IPecege, 2017, vol. 3, issue 1

Abstract: The semi-arid region of Rio Grande do Norte can be an excellent alternative for implementing irrigated and densely planted palm production projects, as much of its territory has a climate unfavorable to rainfed cultivation of this crop. Irrigation and high-density planting emerge as an economically viable alternative for investors. Thus, the objective was to study the economic viability of irrigated and densely planted forage palm production in the semi-arid region of Rio Grande do Norte. Based on data analysis, the production cost per hectare in the municipality of Apodi, Rio Grande do Norte, was considered. The project analyzed investment, maintenance costs, profitability, and estimated growth over eight years. Through cash flow analysis, considering a minimum attractive rate of return of 8%, the Net Present Value [NPV], Internal Rate of Return [IRR], and payback period were obtained, as well as the break-even point calculation. The project was considered economically viable, with a net present value (NPV) of R$ 105,892.49 and an internal rate of return (IRR) of 88%. The project's annual net profit reached R$ 22,552.20, which accumulated over eight years could reach R$ 158,319.80. Based on the payback period, the investor would recoup the initial investment in one year and nine months. The minimum productivity required for this profit was 70,103 kg ha⁻¹ year⁻¹ .

Keywords: Crop; Production/Industries (search for similar items in EconPapers)
Date: 2017
References: Add references at CitEc
Citations:

Downloads: (external link)
https://ageconsearch.umn.edu/record/386254/files/a ... antas%2Bet%2Bal..pdf (application/pdf)

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:ags:ipeceg:386254

Access Statistics for this article

More articles in Revista IPecege from University of Sao Paulo Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().