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Financial Profitability of Green Chilli Production: a Case Study in Bogra District of Bangladesh

Most. Iffat Ara Ila
Dept. of Agribusiness and Marketing, Sher-e-Bangla Agricultural University, Dhaka-1207

Sajeeb Saha
Dept. of Agribusiness and Marketing, Sher-e-Bangla Agricultural University, Dhaka-1207

Abu Zafar Ahmed Mukul
Dept. of Management and Finance, Sher-e-Bangla Agricultural University, Dhaka-1207, Bangladesh.

Abstract/ Executive Summary:

The study aims to assess financial profitability of green chilli. Fifty producers of green chilli from three upazila of Bogra district were selected for study purpose. A structured questionnaire was constructed for data collection. The results are as descriptive statistics and interpreted based on farmer feedbacks. Findings include that total cost (TC) for green Chilliis Tk. 128011.13; gross return (GR) of Green Chilliis Tk. 240864; gross margin (GM) for green Chilliis Tk. 137698. All the calculations are based on per hectare. Thus, producing green Chilli net return (NR) is Tk. 112852.87. The green chilliis attractive for farmers to produce as its benefit cost ratio (BCR) shows 1.88 in our study. Lack of agricultural credit, lack of farmer’s association and lack of crop insurance were the major problems for green chilli cultivation. Farmers expect to avail sufficient credit facilities along with regular government extension services, strong market monitoring authority and better transportation facilities for assisting Chilli cultivation. Moreover, a farmers’ association is needed to be formed in chilli production area.

Keywords: Yield, Costs, Returns, Benefit-Cost ratio, Problems

Location: Sariakandi, Shibganjand Bogra Sadar of Bogra district

Start Date: 00-11-2014

End Date: 00-12-2014

Program Area: Socio-economic and Policy

Commodity: Chilli

Objectives:

The present study was designed to analyze the financial profitability of green chilli, to calculating costs and returns of green Chilli production and to identifying constraints of chilli production faced by farmers.

Methodology:

Bogra district is one of the leading zones in respect of chilli production in Bangladesh. Thus, three upazila (i.e., Sariakandi, Shibganjand Bogra Sadar) of Bogra district were selected as study area.Data were collected during November to December in the year of 2014. Fifty respondents who cultivate green chilli were selected through purposive or judgmental sampling technique. Interview schedules were prepared based on objectives of this study. After testing the draft schedule, final survey schedules were prepared for the collection of necessary data for the study. Primary data were collected by direct interview with a set of interview schedules prepared for the research. At the time of interview, the researchers asked questions systematically and explained the question whenever it was felt necessary to achieve the goals of this study. Tabular technique was used to analyze the data. By using arithmetic means and percentages, different costs, gross margins and net profit were calculated in a tabular form. The following formula was use based on Akter (2012)for calculations. GR= Total Production × unit price, GM=Total return –Variable cost

NR=GR –TC, BCR=GR/ TC, Where, GR=Gross Return, GM=Gross Margin, NR=Net Return, VC= Variable Cost, TC=Total Cost and Total Cost=Total Variable Cost + Total Fixed Cost.

Source of Information: J. Biosci. Agric. Res. 19(01): 1606-1612

Article Link (Online Journal): https://doi.org/10.18801/jbar.190119.195

Funding Source:

Budget:

Total Budget (Tk.) :

Achievement/Findings:

The study estimates the financial profitability of green chilli. The principal finding revealed from the study is that green chilli production in the Bogra district was profitable,where per hectare net return was Tk. 112852.87. Though the farmers get profit,they had to face some barriers. Capital shortage problem, lack of farmers association and crop insurance, poor transportation and communication system, lack of marketing monitoring authority were major barrier for the chilli producers. These problems should be addressed properly to make this crop more profitable.

Knowledge Management: Journal