Cost Benefits Analysis of Lemongrass (cybopogon citratus) Variety: WG-Lomisar-UA for Herbal Production at Wondogenet

Abstract

Despite lemongrass has many uses as culinary, medicinal and as inputs for industries; in Ethiopia production and utilization of this plant is at infant Stage. Besides this, information regarding production costs, returns and financial feasibility of lemongrass production is limited. Thus the study aimed to assess the financial feasibility of WG-lomisar-UA lemongrass production for its herbal use. The study was conducted at Wondogenet agricultural research center experimental field from August 2014 to September 2017.  For this study WG-lomisar-UA lemongrass was planted on 100m² area of land with an intra and inters raw spacing of 60cm. All cost and benefit data were collected throughout the production period. The study employed financial analysis methods such as Net Present Value (NPV) and Benefit Cost Ratio (BCR) to analyze feasibility of production. The result revealed that; the herbal production WG-lomisar-UA lemongrass required a total cost of 60,172.78 birr/ha, and provided total revenue of 152,750 birr/ha, resulted net return of 92,577.22 birr/ha in three years of production. Moreover, net present value and benefit cost ratio was found 76,454.03 and 2.44 respectively indicating that production of WG-lomisar-UA lemongrass is financially feasible. Sensitivity analysis in selected scenarios revealed that production the plant is still financially feasible.