Economic Analysis of Grape Production and its Export performance of India
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Date
2021
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DRPCAU, PUSA
Abstract
The present study was carried out to assess the growth performance in area, production, productivity of grapes in India and Karnataka and export of grapes from India. The study was based on secondary as well as primary data and carried out in the Chikkabalapur district of Karnataka selected purposively considering widespread of horticulture crops, including grapes in the district. Further two talukas of Chikkabalapur, and three villages from each taluka were randomly selected. Sixty farmers from each taluka were selected randomly, thus, a total of 120 farmers was selected for detailed study. Out of these 120 farmers, 70 were growing Dilkhush variety and 50 Bangalore blue variety of grapes. The sample farmers were classified as marginal (<1 ha), small (1-2 ha) and semi-medium (2-4 ha) based on size of orchards for detailed study.
Compound growth rates of area, production and productivity of grapes for Karnataka were estimated to be 3.09%, 3.28% and 0.18%, respectively, while growth in productivity was constant during the period of investigation. At national level, growth rates of area, production and productivity was computed to be 3.0%, 2.46% and (-) 0.52% respectively. It was observed that growth rates of area, production and productivity were higher for Karnataka.
India exported 253619.02 MT of fresh grapes amounting to about Rs 233765.09 during 2018-19 which was about 8.34% of total production, up from 1.95% of its total grapes production in 2000-01. The compound growth rates of volume of export were 6.08% per annum and 9.19% per annum in value term. Major export destinations from India during 2019-20 were Netherlands (36.14%), Russia 12.20%, UK (9.44%), Bangladesh (6.33%), Germany (6.28%), United Arab Emirates and Saudi Arab 5.16% and 3.55%, respectively.
So far as costs and returns from the grape production are concerned; in case of Dilkhush variety, a sum of Rs. 596954.03/acre was incurred as overall establishment cost. Category-wise analysis of costs revealed that Rs 609101 /acre, Rs.596304.39 /acre and Rs.585456.71/acre incurred as overall establishment cost for marginal, small and semi-medium farmer respectively. The fixed costs contributed a major share in the overall establishment costs in all three categories of farmers. Maintenance costs incurred during gestation period were found to be Rs.120118.33 (19.72%) for marginal, Rs. 121328.61 (20.35%) for small and Rs, 122147.95 (20.86%) for semi-medium farms. Establishment costs of Bangalore Blue variety of grapes indicated the similar trend. However, establishment cost in case of Bangalore blue was higher compared to Dilkhush on account of higher plant population but maintenance cost was less as the plants were resistant to diseases and pests.
Cash flows for both the varieties were found to be positive at 10% discount rate. In case of Dilkhush per acre discounted NPW was Rs.1954798 for overall farms. Farm size-wise NPWs were assessed to be Rs.2072558.30 for Marginal, Rs.1930233.03 for small and Rs.1861602.68 for semi-medium farms for the entire economic lifespan of 15 years, indicating that cultivation of Dilkhush variety was economically viable enterprise. For Bangalore blue variety results revealed that the per acre discounted NPW was Rs. 492245.56 for overall farms; Rs.506853.30 for the Marginal, Rs.505918.41 for small and Rs.463964.98 for semi-medium farms for economic lifespan of 15 years.
The B-C ratios for both Dilkhush and Bangalore Blue orchards were more than one for all farms as well as for various categories, this confirmed that the grape cultivation was a profitable venture. The IRR was 42.33% for overall farms for Dilkhush and 21.66% for Bangalore blue orchards which were higher than prevailing rate of bank interest. The same trend was observed for other size groups too.
A probe into technical efficiency (TE) indicated that those growing Dilkhush variety were operating at an average of 68% TE level. The elasticity associated with the seedling, fertilizers, manures and expense on labour for pruning were positively significant and the elasticities only for fertilizers and labour used for pruning were more than one indicated that one unit increase on investment on these inputs would enhance the yield of grapes by more than one unit in case of Dilkhush grapes farming. The mean TE for Bangalore blue grapes was 83% for overall farms and only manure was found to be statistically significant with elasticity more than one indicating that one unit increase in manure can boost the production by 1.28 units.
Constraints reported by respondents revealed that rising costs of inputs was major problem for grapes growers followed by lack of skilled labour followed by inadequate credit availability from financial institutions, scarcity of water, climatic changes etc. As orchards require skilled labour and establishment of orchards are capital intensive and unavailability of skilled labour and credit facilities were given first and second ranks. Damages due to poor climatic conditions also damage the crops resulting poor yield hence, was ranked fifth. Other problems reported were pests and diseases, lack of timely availability of inputs, poor technical knowledge about suitable chemical use and irregular supply of electricity.
Problems in marketing revealed the price fluctuation as the major constraint followed by need for proper storage due to perishable nature of the produce. Other marketing related problems were high intervention of market middlemen, inadequate processing facility and poor handling and transportation. Addressing properly the prevailing constraints in the area under investigation, yields of the produce could be boosted and respectable income could be earned by the farmers involved in the grapes farming.