In this article we will discuss about the economics of mango orchards in the various states of India.
Economics of Mango Orchards in Chittor and Krishna Districts, Andhra Pradesh:
The economics mango orchard in selected districts of Andhra Pradesh is presented in Table below:
Taking into account Chittor and Krishna districts together the average yield of mango stood at 6.5 metric ton per hectare in the age group of 6 to 14 years, while the stabilized yield recorded at 12.5 metric ton per hectare for orchards having attained the age bracket of 15 to 35years. Annual gross income worked out to Rs. 29,500 per hectare and Rs. 56,500 per hectare in the lower and higher age groups respectively.
The net income earned were Rs.15, 500 per hectare and 42,500 per hectare in the same age groups. The entire capital cost would be covered in four years, if the borrowers resort to own fund. Otherwise the amount would be capitalized in the event of institutional finance.
Cash Flow Statement of Mango Orchards in Andhra Pradesh:
Capital Cost/Invest Cost/Cost of Establishment of Andhra Pradesh:
The cost of investment of mango orchard was estimated at reference year prices rather than at historical prices since majority (73 %) of the sample mango orchards were of more than 15 years of age and as such reliability of the historical cost would be questionable as it is fraught with memory recall bias and the farmers do not maintain any records of expenses made by them.
The cost of investment of the mango orchards in the sample district, on an average, was estimated at Rs. 31,750 per hectare during first year (Table 8.5). The cumulative cost of investment Rs. 31,750 and maintenance Rs. 30,750 till fifth year is reported at Rs. 62,500 depending upon the quality of soil, irrigation and planting material.
Cost of Maintenance (From 10th year onwards) in Andhra Pradesh:
Manuring, plant protection and irrigation are the major components in the maintenance cost, apart from the labor charges for various cultural operations such as weeding, input application, training, pruning etc. The annual maintenance cost per hectare of full grown mango orchard (from 10lh year onwards) has been worked out to Rs. 13,750 (Table 8.6).
Gross and Net Income of Andhra Pradesh:
The average yield of mango varies from orchard to orchard depending on the climate, soil texture, cultivation practices adopted etc. In case of the sample mango orchards in the study districts, the average yield was reported at 12.5 MT/ hectare in a stabilized orchard of 15 years and above.
Considering the same yield, the economics of mango orchards has been arrived at for the average situation presented in table below:
Cash Flow Statement of Mango Orchards of Andhra Pradesh:
The economics of mango Orchards in the sample districts was worked out the following assumptions as assessed during the study:
1. Since the sample mango orchards were established without replacing any other crop, the pre development income of these lands was assumed to be zero.
2. The mango orchard starts yielding from the sixth year on wards and stabilized yield is obtained from 15 year up to 35 year.
3. The costs of maintenance of a mango orchard in the early years of planting is less than the matured garden, viz, Rs. 10,000 per hectare (6th / 7thyear). Rs. 11,250 per hectare (up to 9th), Rs. 13,750 per hectare (from 10th year). Variation is due to increase in nutritional and inter cultural requirements. The cash flow state in Mango orchard is brought out in the table 8.8.
The farmers in Chittor district were of the opinion that the recurring drought for the third consecutive year, viz, 2002-03, 22003-04 and 2005-06, had affected the economics of existing mango orchards.
Calculation of NPW, BCR and IRR in Selected Districts of Andhra Pradesh and Maharashtra:
The mango orchard in the district was viable with the present level of yield, cost and price. The financial rate of return (IRR) worked out to 20.83 per cent (Table 8.13).
It is evident from the table that NPW registered highest figure at Rs. 1, 25,534 per hectare compared to Sindhudurg (Rs. 45,846 / ha) and Chittor (Rs. 19,866/ ha). The internal rate of return was more than 15 per cent for all the sample orchards and as such the investment in mango is financially viable.
Economics of Mango Orchards in Maharashtra —Sindhudurg (Alphonso):
Attempt has been made to assess annual net income accrued per hectare in Alphonso and Kesar varieties of mango in Sindhudurg and Aurangabad districts respectively (Tables 8.2 and 8.3).
Maharashtra —Aurangabad:
Average yield of Alphonso mango was higher than Kesar. It was 4.5 MT/ha compared to 3.46 Mt / ha during 6 to 14 years. However, the stabilized yield of Alphonso mango during 15 to 35 was lower at 4.73 MT/ ha as against Kesar mango 4 .88 MT/ ha. The annual net income earned per hectare was higher (Rs. 55,024 /ha) in Alphonso mango than Kesar mango (Rs. 44,773 /ha) during tender age. During adult period kesar mango earned higher net income at Rs. 67,993/ha) compared to Alphonso mango (Rs. 53,698/ha).
Economics of Alphonso Mango in Sindhudurg, Maharastra:
The invest cost for raising Alphonso mango orchard is incurred during the initial five years of plantation.
Such costs for cultivating the orchard in one hectare of land are given Table 8.9:
Maintenance Cost:
Maintenance cost for initial five years has been capitalized. Thereafter the cost of maintenance keeps on increasing every year. However, for the purpose of arriving at the economics, the maintenance cost is grouped taking account the mean average maintenance cost.
The details of maintenance expenses for raising one hectare of Alphonso mango orchard is given in Table 8.10:
Cash Flow Statement of Alphonso Mango:
The cash flow statement for Alphonso mango orchard has been prepared on the basis of the following assumptions and information:
1. The capital cost has been taken as per accrual basis during the initial five years. It works out to be Rs. 1, 84,996 per hectare with a mixed of those using blasting techniques and others.
2. The annual maintenance cost is Rs. 573 for trees of 6 to 15 years old. The same for trees of more than 15 years old is Rs. 641. Thus, the average annual maintenance cost comes to Rs. 628 per tree.
3. Income has been taken as stable from 15 th year onwards. The income during 6 th, 7 th, 8 th 9 th, 10 th to 15 th year has been taken on the basis of actual yield and current price.
4. Net income has been arrived at after netting the maintenance and marketing cost from the gross income.
5. The economic life of the mango tree has been considered as 35 years, though it continues to give yields until it reaches an age of about 100 years.
6. The salvage value of orchards, being very low when considered for a period of 35 years, has been ignored.
7. Most of the Alphonso gardens in the state were raised in the 1980s under various schemes of state government and each item of expenditure was subsidized to a large extent. Therefore, subsidy component is ignored while computing internal rate of return (IRR) in the model projects.
8. The orchards are being developed in hitherto unused up lands/barren lands. The pre development income being negligible in the project area, the same has not been taken into consideration.
Cash Flow Statement of Kesar Mango in Aurangabad:
The invest cost for raising Kesar mango orchard is incurred during the initial five years of plantation.
Such costs for cultivating the orchard in one hectare of land are given Table 8.11:
Maintenance cost for initial five years has been capitalized. Thereafter the cost of maintenance keeps on increasing every year. However, for the purpose of arriving at the economics, the maintenance cost is grouped taking account the mean average maintenance cost.
The details of maintenance expenses for raising one hectare of Kesar mango orchard is given in Table 8.12:
Sensitivity Analysis of Sample Orchards in Sindhudurg and Aurangabad of Maharashtra:
Since there are wide fluctuations in production and prices of mango as per the grass root level situation in the study area, sensitivity analysis is attempted by increasing cost by 5 per cent and decreasing benefit by 5 per cent.
The table below shows the details:
Under the sensitivity analysis, the BCR is more than one in both Alphonso and Kesar variety of mango. Thus, the investments in these varieties are beneficial. Similarly, the IRR s at 15.15 per cent and 20.82 per cent stand the test of sensitivity analysis. It is more than the threshold limit of 15 per cent reckoned for opportunity cost of capital.
Economics of Mango Orchards in Malda of West Bengal:
The fazli variety of mango earned maximum net income to the level of Rs. 1,06,340 per hectare followed by Aswina at Rs. 78,000 per hectare, Langra (Rs. 28,150/ha) and Himsagar (Rs. 18,750/ha).
Cost and Revenue per hectare of Model Orchard (50 Tree) in Malda:
Cost and revenue per hectare of Model Orchard (50 tree) is given below:
Net income accrued by Fazli variety of mango was Rs 2,96, 000 per hectare followed by Langra at Rs 2,81,500, Himsagar at 1,87,500 and Lasxmanbhog (1,20,000/ha).