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The Profitability of Hail Netting in Apple Orchards

Kristel Whitaker and Simon Middleton

No 125036, 1999 Conference (43th), January 20-22, 1999, Christchurch, New Zealand from Australian Agricultural and Resource Economics Society

Abstract: Approximately 40% of the apple orchard area on the Granite Belt in Queensland is covered with nets to protect the crop from hail damage. The effects of hail netting on apple orchard microclimate, productivity and tree growth have been measured over many seasons; however, limited work has been done on evaluating the economic benefits. Cost-benefit analysis was used to calculate the expected profitability of hail netting on the Granite Belt. Criteria used were the Equivalent Annual Return (the annualised Net Present Value), the Internal Rate of Return and the Payback Period. Estimates of the net benefits have taken into consideration the secondary benefits of hail netting, such as reductions in sunburn and bird damage to apples, and were partly based on the probability distribution of hailstorms on the Granite Belt. Insufficient historical hailstorm data were available, so the probability distribution was developed from a survey of experienced growers in the region. The incidence and severity of hailstorms can vary significantly between growers within the same district. Therefore, the cost-benefit analysis was developed in such a way that it can be used as a decision tool for individual growers. By entering information about his or her own orchard, a grower can determine if it is likely to be profitable to erect a hail net.

Keywords: Crop Production/Industries; Risk and Uncertainty (search for similar items in EconPapers)
Date: 1999
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aare99:125036

DOI: 10.22004/ag.econ.125036

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