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Cost-benefit Analysis of Different Agroforestry Systems and Practices of Kaharole Upazila of Dinajpur District, Bangladesh

M. S. Rahman
Department of Agroforestry and Environment, Hajee Mohammad Danesh Science and Technology University (HSTU), Dinajpur-5200, Bangladesh.

P. R. Roy
Department of Agroforestry and Environment, Hajee Mohammad Danesh Science and Technology University (HSTU), Dinajpur-5200, Bangladesh.

M. M. Ali*
Department of Agroforestry and Environment, Hajee Mohammad Danesh Science and Technology University (HSTU), Dinajpur-5200, Bangladesh.

M. S. Bari
Department of Agroforestry and Environment, Hajee Mohammad Danesh Science and Technology University (HSTU), Dinajpur-5200, Bangladesh.

I. J. Sarmin
Department of Agroforestry and Environment, Hajee Mohammad Danesh Science and Technology University (HSTU), Dinajpur-5200, Bangladesh.

M. A. Rahman
Department of Agroforestry and Environment, Hajee Mohammad Danesh Science and Technology University (HSTU), Dinajpur-5200, Bangladesh.

Abstract/ Executive Summary:

A study was carried out to evaluate the costs and benefits of three agroforestry systems like homestead, cropland and orchard agroforestry of Kaharole Upazila under Dinajpur district of Bangladesh. An extensive field survey and measurements were conducted during July 2017 to January 2018 at different unions and villages of Kaharole upazila. A multistage random sampling procedure was followed in this study to select the survey area. A pre-structured questionnaire was used for collecting the benefits and costs data. A total of 60 agroforestry practices including 20 homesteads, 20 orchards and 20 croplands were evaluated for cost and benefit analysis. Initial three years costs and income data were collected from the field survey. A projection of seven years cost and income was also produced using regression model. Results of the production cost analysis showed that significantly maximum production cost was in orchard agroforestry system (Tk. 98987 per ha.) followed by cropland (Tk. 90238 per ha.) and minimum in homestead system (Tk. 10854 per ha.) in the 1st year. But production cost decreasing trend was recorded in the successive years in all the systems. In case of gross income analysis showed that though initial income was significantly lower in orchard agroforestry followed by cropland and homestead but after tenth year higher income was found in orchard agroforestry system (Tk. 564758 per ha.) followed by cropland (Tk. 251914 per ha) and homestead (Tk.234234 per ha) agroforestry system. However, the net income indicated that orchard agroforestry system was financially more profitable than cropland and homestead agroforestry systems, but the benefit-cost ratio (BCR) was higher in homestead as well as cropland agroforestry systems and lower in orchard agroforestry system. On the other hand guava based agroforestry practice was more lucrative than all other practices. In spite of higher BCR of homestead agroforestry, farmers in the study area widely practiced the orchard agroforestry. It appears that the farmers’ decision regarding what kind of land use they will adopt depends not on the BCR, but largely on the net amount of income that they earn.

Keywords: Homestead agroforestry; Cropland agroforestry; Orchard agroforestry; Cost and income of agroforestry; Benefit cost ratio.

Location: Kaharole Upazila of Dinajpur District, Bangladesh

Start Date: 00-07-2017

End Date: 00-01-2018

Program Area: Socio-economic and Policy

Commodity: Agroforestry

Objectives:

Hence, there is a lack of realistic information and knowledge on the economic analysis of different practices of homestead, cropland and orchard agroforestry in northern region. Considering the above circumstances, the present study was undertaken to screen the best profitable agroforestry systems of Kaharole upazila under Dinajpur district of Bangladesh.

Methodology:

2.1 Study Area The experiment was conducted in the Kaharole upazila of Dinajpur district of Bangladesh which lies in between 25°44' and 25°53' north latitudes and in between 88°30' and 89°43' east longitudes. This study follows a multistage random sampling procedure. Firstly, Dinajpur district is purposively selected from the northern region of Bangladesh. Consequently, out of 13 upazilas (sub-districts) in the Dinajpur district, Kaharole upazila is randomly selected. Out of 6 unions of Kaharole upazila, a total of 4 unions are selected randomly taking 5 villages and from each village 3 systems were selected.

2.2 Data Collection A household survey was carried out with a pretested questionnaire format to fulfill the objectives of the study during July 2017 to January 2018. Independent variables were different time periods (in years) and dependent variables were production cost, gross income, net income and benefit cost ratio.

2.3 System and Practice Identification Agroforestry systems of this study were homestead, cropland and orchard. Within the systems, different practices were analyzed based on timber/fruit tree species. Data were collected from the practices and they were again categorized into three agroforestry systems.

2.4 Data Analysis Annual production cost and income of a farmer was measured in taka on the basis of the total yearly production (land preparation cost, labor cost etc.) and income (fruit, crop, timber etc). Net income was calculated by deducting the total cost of production from the gross income. Benefit-cost ratio is the ratio of gross income to total cost of production. The B–C ratio, which indicates the rate of return per unit of cost, will be calculated based on the following formula.

In this experiment, normality test was done for income and costs data by the Kolmogorov– Smirnov test by SPSS Version 22. To get normal distribution, all income and cost data were transformed to natural logarithm (e-base) and tested for normality. After analysis of log transformed data, antilogarithmic data were presented.

Source of Information: South Asian Journal of Social Studies and Economics 8(4): 87-97, 2020; Article no.SAJSSE.59584 ISSN: 2581-821X

Article Link (Online Journal): DOI: 10.9734/SAJSSE/2020/v8i430221

Funding Source:

Budget:

Total Budget (Tk.) :

Achievement/Findings:

From the findings of this study it can be concluded that the cost of orchard agroforestry system was higher than cropland and homestead agroforestry systems. Homestead agroforestry system had lowest cost and lowest income than the other systems while highest income was recorded in orchard agroforestry system. As a result net income was recorded highest in orchard system and lowest in the homestead agroforestry system. On the other hand benefit cost ratio (BCR) was high in homestead and cropland agroforestry systems. BCR of orchard agroforestry system was lowest because of its high cost of production. As orchard agroforestry system provided more net income in spite of its higher initial cost, farmers should give more emphasis to grow orchard agroforestry by minimizing the initial cost. It appears that the farmers’ decision regarding what kind of land use they will adopt depends not on the BCR, but largely on the net amount of income that they earn.

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