Financial assessment of adopting irrigation technology for plant-based regulated deficit irrigation scheduling in super high-density olive orchards

Gregorio Egea, José E. Fernández and Francisco Alcon

Agricultural Water Management, 2017, vol. 187, issue C, 47-56

Abstract: Hedgerow orchards with high plant densities, or super high-density (SHD) orchards, are considered to be amongst the most profitable management systems for most fruit-tree species. Regulated deficit irrigation (RDI) strategies are recommended for SHD olive orchards, especially when scheduled from automatic and continuous measurements of plant water stress. There is a lack of information, however, on the profitability of this approach. In this work we analysed the financial feasibility of using three different systems for monitoring water stress in an ‘Arbequina’ SHD olive orchard under a RDI strategy recommended for the experimental area (SW Spain). The systems were based on sap flow (SF), trunk diameter variation (TDV) and leaf turgor pressure (TP) related measurements. We first compared their equivalent annual cost (EAC), resulting the TP based technology as that with the greatest potential to be adopted by farmers. We then used Discounted Cash Flow Analysis (DCFA) to compare the financial feasibility of an RDI treatment scheduled from TP related measurements and providing 45% of the crop water needs (45RDITP) with both a similar treatment but scheduled with the crop coefficient approach (45RDICC) and a fully irrigated (FI) treatment. Our results from two irrigation seasons demonstrated that the 45RDI strategy guarantees the profitability of SHD olive orchards in the long-term, with both 45RDICC and 45RDITP showing positive Net Present Value and Internal Rate of Return above the interest on capital. All the financial indicators suggested higher financial performance of 45RDITP as compared to 45RDICC, but differences were not significant, likely because of the high variability among replicates. The financial impact of Common Agricultural Policy payments as well as varying olive oil and irrigation water prices on the irrigation treatments was discussed.

Keywords: Hedgerow olive orchard; Olea europaea; Precision irrigation; Water economy; Water productivity (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:agiwat:v:187:y:2017:i:c:p:47-56

DOI: 10.1016/j.agwat.2017.03.008

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