Abstract
This study employs an ex-ante analytical approach to explore the financial viability of cocoa agroforestry systems in Ghana using cross-sectional data on smallholder cocoa farmers in the Western Region of Ghana. The empirical results generally show that cocoa agroforestry systems are profitable, but the medium shade tends to be more profitable. The no-shade cocoa agroforestry has the highest yield compared with other cocoa agroforestry systems. Sensitivity analysis revealed that increasing the market price by 12.2 % tends to increase the profitability of cocoa agroforestry systems. Also increasing fertilizer price does not lead to any significant change in the profitability. The study recommends the medium-shade cocoa agroforestry system as the most profitable agroforestry system for optimizing ecological and economic outcomes of smallholder cocoa farmers in sub-Saharan Africa.
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Notes
BCR of one indicates a breakeven point.
An investment is technically and economically feasible if the NPV is positive.
The management systems of cocoa production analysed include the owner-managed, lease-managed and, sharecrop-managed systems.
It is assumed that cocoa farmers managing shade trees will prefer higher price for timber trees because of the resources (time and money) spent in tendering and managing the timber trees.
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Nunoo, I., Owusu, V. Comparative analysis on financial viability of cocoa agroforestry systems in Ghana. Environ Dev Sustain 19, 83–98 (2017). https://doi.org/10.1007/s10668-015-9733-z
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DOI: https://doi.org/10.1007/s10668-015-9733-z