Production, Marketing, and Financial Analysis of a Aquilaria crassna Pierre ex Lecomte Plantation in Prachin Buri Province, Thailand

Abstract

                The objectives of this study was to analyze the production, marketing, and financial analysis of a Aquilaria crassna Pierre ex Lecomte plantation located in Prachin Buri province, Thailand. Data was gathered by interviewing 133 respondents and was analyzed using various statistical methods namely frequency, percentage, and mean. Financial analysis methods used in this study were net present value (NPV), benefit cost ratio (B/C), and internal rate of return (IRR) with given discount rates of 4, 6, 8, 10, and 12 %, throughout the switching value test.

            The study found that 51.88% of A. crassna farmers were males with an average age of 55.89 years. A majority of them (64.66 %) were educated upto primary school level. The main occupation was agriculture (55.64%) with the average size of a plantation being 4.51 rais. Most of them used an agroforestry based silvicultural system with 11 people, 8.27% of whom were A. crassna growers, with a rotation period of 10–15 years. There were 3 types of A. crassna products being sold 1) woodchips with an average price of 80 THB per kilogram 2) wood pieces with a price between 7,000-10,000 THB per kilogram and 3) A. crassna wood oil priced between 1,000–2,000 THB per tora. The financial analysis to determine the discount rates of all B/C between 1.50–4.60 were over 1, with an NPV, given the determination rates, between 23,030.47-360,238.81 THB per rai (>0) and an IRR between 24.82-81.22% were over the determined discount rate. This indicated that the investment had been profitable. Moreover, a switching value test indicated to a benefit between 33.24-78.25% and a switching value of cost between 49.79–359.69%. We therefore concluded through the value test that the investment was a low risk proposition.

Keywords: Production, Marketing, Financial analysis, Forest plantation, Aquilaria crassna Pierre ex Lecomte