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Can A Mango Grower Increases Profit By 1,700% [In A Single Year]?
(The article is discussing Global Problems while using Africa as a Case Study)
This article is pure gold! Read it, print it, and follow it every day until you complete the roadmap and get the results you dream of.
I am aware that due to objective reasons, most of the world's farmers live in poverty, unable to recover from their situation.
Poverty is so great and unbelievable extended that trying to improve their income by 'just a little' or having them 'enough to survive' is simply not the solution.
What is needed is a long-term solution, which requires deep state-level structural changes.
But, can the income be increased even before such (long term) structural changes have taken place? Is raising income limited to a few percents per year, or can it be more than that? Is it possible to increase income by tens of percent, or even hundreds of percent in a year or two?
I believe that it is our professional and moral duty and that it is possible to raise farmers' income almost immediately.
In order not to leave this as a theoretical idea, I will illustrate this with a specific example in a specific agricultural sector.
One can assume that the same, with required adjustments, can be copied and implemented to other sectors.
Note: The numerical underlying assumptions presented represent the “as is” state in many markets. In some markets, the numbers are likely to be slightly different, but similar trends are expected.
* Sector – Mango growers.
* Crop area size and worldwide distribution - Mango is common throughout Africa and Asia, with tens of thousands of hectares in every country. India, the largest mango producer accounts for over 40% of the world's production, with over 2 million hectares.
* Yield per hectare – for our example we use 6,000 kg per hectare, which is somewhat high for most growers.
* Farmers' price per kg – for domestic 0.33 USD, for export 0.5 USD.
* Major problems - the average loss of crop due to pest damage (especially fruit flies) is 50% (and even more). Fruit fly infestation is especially critical for income increase since it blocks any possibility of exporting and getting a premium price.
Reliability of Data
The data presented below is the real data from many field tests and trials, which previously was presented to farmers and experts in the field. The common reaction was that the actual expenditure is higher. I decided to leave it as is, to show that even under favoring assumptions the situation today is unbearable.
Cost of Fruit Fly Control Measures
Investment in fruit fly control is one of the major cost components for farmers growing mangoes.
While many farmers gave up and stop treating for fruit flies, the ones who continue to fight usually take one of the following methods:
1. Commercial - The main method used is by applying a mix of – sprays + traps + sanitation. Cost often ranges from 500 USD to 1,000 USD per hectare. Common infestation while using the Commercial technique is about 50% (even more after the rains).
The study made in Ghana. It presents the cost of fruit fly control, ranging from 2,260 $/Ha to 1,700 $/Ha. (source)
2. Bags – used mainly in the Far East with a cost depending on the yield. For 6,000 kg/Ha the cost is expected to be 2,000 USD. Infestation is very low when using this technique.
3. Sterile Insect Technique (SIT) – SIT is mostly used in conjunction with sprays + traps + sanitation. Cost often ranges from 1,500 USD to 3,000 USD per hectare. Common infestation while using the SIT is about 50% (even more after the rains).
In order to illustrate, we will use as the cost of fruit fly control under all scenarios is the same as the Commercial method, with an average cost of 700 USD.
Scenario 1 - Current
Structure of current revenue expenditure. Potential income is 2,000 $/Ha. Due to high investment in fruit fly control and high yield loss of 50%, the profit is only 2.5%, which equals to 50 $/Ha.
The baseline for calculations, 0% added income.
Scenario 2 - Effective Fruit Fly Control
From Scenario 2 and onward, we assume that fruit flies are effectively controlled.
Applying FreeDome in a mango orchard.
Potential income remains 2,000 $/Ha. All expenses are the same as in Scenario 1.
Fruit fly infestation is decreased by 80%, and as a result, the profit soars by 1,700% (17 times), to 850 $/Ha.
Note that in practice fruit fly infestation is commonly decreased by over 95% while using FreeDome, and often we were unable to find an infestation.
Expenses and yield per hectare, as well as price per kg, remain the same as in Scenario 1. Income is increased by 1,700% to 850$ per hectare.
Scenario 3 - Early Export
Here we assume the same yield, but part of the yield is now going for export markets at a higher price per kg. Therefore the potential income increases to 3,000 $/Ha. Expenses and fruit loss (due to higher standards) is slightly increased.
Fruit fly infestation is decreased to Export Standards, and as a result, the profit soars by 3,000% (30 times) versus Scenario 1, to 1,500 $/Ha.
Scenario #3 requires government intervention and is scheduled for execution under the Green Valley National Export Project (GVNEP).
In Scenario 3 - expenses per hectare and price per kg are slightly higher. Yield per hectare remains the same. Income is increased by 3,000% to 1,500$ per hectare.
Scenario 4 – Export and Increased Yield
The dramatic change in Scenario 4 is the increased yield, from 6,000kg to 20,000kg per hectare, through Capacity Building set of activities.
The potential income increases to 10,000 $/Ha. Note the great increase in 'Various expenses', which is a result of much higher standards required to stand in Export Quality.
Profit soars again, this time by 140,000% (140 times), to 7,000 $/Ha
scenario #4 requires government intervention and is scheduled for execution under the Green Valley National Export Project (GVNEP).
In Scenario 4 – Yield per hectare increased to 20,000kg. Expenses per hectare considerably increased, while the price per kg is unchanged compared to Scenario 3. In compare to Scenario 1, income is increased by 140,000% (140 times) to 7,000$ per hectare.
Conclusions from the above-presented scenarios
For this exercise, for the sake of being on the safe side, on purpose, I didn't use any extremely high yield per hectare or price per kg.
Even while using moderate assumptions we can continuously increase the income of farmers, and really over-perform; as long as we can keep the doors open for export markets, and keep quality of produce high and suitable for high-value premium markets.
All scenarios have a firm grip on proven reality, and all can be executed immediately.
All is needed are some decisions – first by the farmers and then by the authorities.
It is important to note that as we progress from Scenario 2 to Scenario 3, and Scenario 4, there is a growing need for governmental involvement.
In fact, while Scenario 2 can be delivered directly to individual farmers and the profit will sour already at the first year of use of the FreeDome,
Scenario 3 and 4 can only take place under intensive governmental intervention. GVNEP is a business model made to facilitate the transaction from Scenario 2 to the more advanced and profitable Scenario 3 and 4.
Now that we know exactly how we can increase farmers' income by much more than 20%, 30% or even 50%, it is time to act.
Biofeed team and I will be glad to provide more information and support you in the process itself.
For a greener world
Free of sprays
Full of joy
See you soon,
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