Total value of benefits and financial costs from independent oil palm plantations in Seruyan regency in 2023

Afirus Febian; Bambang Joko Priatmadi; Danang Biyatmoko; Dewi Erika  Adriani

doi:10.14719/pst.3594

Authors

Afirus Febian Faculty of Agriculture, Darwan Ali University, Kotawaringin Timur 74322, Central Kalimantan, Indonesia https://orcid.org/0000-0001-7519-3562
Bambang Joko Priatmadi Faculty of Agriculture, Lambung Mangkurat University, Banjarbaru 70714, South Kalimantan, Indonesia https://orcid.org/0000-0001-5347-0864
Danang Biyatmoko Faculty of Agriculture, Lambung Mangkurat University, Banjarbaru 70714, South Kalimantan, Indonesia https://orcid.org/0000-0002-4377-3105
Dewi Erika Adriani Faculty of Agriculture, Lambung Mangkurat University, Banjarbaru 70714, South Kalimantan, Indonesia https://orcid.org/0000-0003-0033-939X

DOI:

https://doi.org/10.14719/pst.3594

Keywords:

Cost-benefit analysis, independent palm oil, independent smallholders, insurance value, Net Present Value

Abstract

Independent palm oil growers have participated in meeting the world's palm oil needs as well as contributing to economic development by increasing income and reducing poverty. Therefore, knowing the total value of benefits and financial costs from independent oil palm plantations is very important. This research aims to determine the total value of benefits and financial costs of independent oil palm plantations in Seruyan Regency. The Slovin method was used in selecting the sample size. The research method uses an exploratory research method, with benefit-cost analysis in the form of calculating Net Present Value (NPV), benefit-cost ratio (B/C Ratio) and Internal Rate of Return (IRR). The results show that independent oil palm plantations in 2023 in Seruyan Regency are financially feasible to implement, this is indicated by the value of benefits greater than the value of costs, namely the total value of PV benefits IDR 1,409,358,175,296.54 and the total value of PV costs IDR 44,466,996,210.44; a positive NPV value of IDR 1,501,380,296,994.71 and a B/C ratio of 3.169 and an IRR of 11 %. Where this analysis has shown that the benefit value is greater than the cost value, so financially independent oil palm plantations can provide benefits for improving community welfare. However, this prosperity does not last forever, because the value of the benefits provided will decrease in the long term, this shows that oil palm plantation activities are not feasible in the long term, to change this condition can be overcome by preparing to carry out replanting.

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