Effects of Spinetoram on Rionegro (Antioquia, Colombia) avocado production
Mario Velasquez
Industrial Engineer
Posgraduate Project social assessment
MSc Applied Economics
Economic Study Objectives
To determine the effect of the use of spinetoram on avocado primary production in Rionegro (Antioquia-Colombia) by measuring changes in profitability in local production.
Avocado Local Production
Avocado trading
Avocado Primary Production Profitability
“Economic losses to pests may be from reduced yields or degradation of product quality…” The Economic Impact of the IR-4 Project and Programs
Study Steps
Methodological Approach
Data analysis
Calculations
Findings
Methodological Approach
P
Q
D Local Market
S avocado Rionegro
Q0
Plocal
Q1
D International Market
Pexport
ΔP
ΔQ
Methodological Approach
P
Q
D Local Market
S avocado Rionegro
Q0
Plocal
Q1
D International Market
Pexport
ΔP
ΔQ
Determine the price differential between local and international price
Estimate production volume using spinetoram
determine the production differential that can be marketed at export prices.
Estimate additional benefit in monetary terms
Methodological Approach
Data Analysis
Price in wholesale markets�Consumer price index
Exports
Planted and harvested area, production, yield
Interview
Behavior of the primary production of avocado in Colombia
EVA MADR
FAOSTAT
Behavior of the primary production of avocado in Colombia
Behavior of the primary production of avocado in Rionegro
Behavior of the primary production of avocado in Rionegro
Behavior of the primary production of avocado in Rionegro
Year | Cost / ha | Kg Avocado / Tree | Kg / ha | Ton / Ha |
1 | 20,000,000 | 0 | - | 0 |
2 | 15,000,000 | 3 | 600 | 0.6 |
3 | 15,000,000 | 18 | 3,600 | 3.6 |
4 | 8,000,000 | 30 | 6,000 | 6 |
5 | 8,000,000 | 50 | 10,000 | 10 |
6 | 8,000,000 | 60 | 12,000 | 12 |
7 | 24,000,000 | 60 | 12,000 | 12 |
8 | 24,000,000 | 60 | 12,000 | 12 |
9 | 24,000,000 | 60 | 12,000 | 12 |
10 | 24,000,000 | 80 | 16,000 | 16 |
Planting density | 200 |
Kilos / Ton | 1000 |
Oportunity Interest Rate | 11% |
Calculations
Planting density | 200 |
Kilos / Ton | 1000 |
Oportunity Interest Rate | 11% |
NPV | $20,681,268.48 |
IRr | 23% |
PV Costs | -$95,263,470.12 |
EAC | -$16,175,873.18 |
Calculations
Production with Exalt | 90% |
Avocado shrinkage due Thrips | 7% |
Standard shrinkage | 3% |
Production Using exalt
Production Rionegro
90%
Avocado shrinkage due Thrips (Qtrips)
Production Using exalt
7%
Standard shrinkage (Qstandard)
Production Using exalt
3%
ΔQ traded at export prices
Avocado shrinkage due Thrips (Qtrips)
Standard shrinkage (Qstandard)
Calculations
ΔP
Price export markets (PExports)
Local Price Rionegro(Plocal)
Calculations
Production (Ton) | (90%) | (7%) | (3%) | Gradient (Thrips Shrinkage - Estándar Shrinkage) (Ton) | Average annual price in wholesale markets (COP $ / Kg) | Avocado Exportation price / Kg (COP $) | Gradient Price (Export Price - Local Price) (COP $) | Additional income received (COP $) |
Production using Exalt (Ton) | Avocado shrinkage due Thrips (Ton) | Standar shrinkage (Ton) | ||||||
1,487 | 1,337.94 | 93.66 | 40.14 | 53.52 | 2,846.32 | 6,000 | 3,153.68 | $ 168,777,223 |
Additional Income
(53.52 Ton x 1000 Kg / Ton) x (COP $3.153 / Kg)
Additional Income
COP $ 168.777.223
Equivalent to 3.9% of production value
Findings
Growers interested in exporting use exalt for effective control of thrips. According to interviewee, 90% of the production is covered by Exalt.
Primary production of avocado in Rionegro receives additional COP $168 MM for controlling thrips and marketing that volume in the export market
This value per hectare is equivalent to COP $1.2 M per year. Almost a minimum monthly wage. The additional volume marketed at export prices generates the equivalent of one monthly salary.
Primary avocado production in Rionegro generates about 110 direct jobs.