An Economic Analysis of Agar-Wood Production in North-Eastern Bangladesh

The present study was carried out to examine the economics of agar-wood production and assess the financial viability of agar plantations in north-eastern Bangladesh (Barlekha Upazila, Moulvibazar District). Primary data were collected through structured questionnaire administered on 30 agar farmers using purposive sampling technique during the months of September, 2017. The total cost of agar-wood production was found BDT 1450571.20 per acre and BDT 1611.73 per agar tree. The net return was found BDT 1892928.80 per acre and BDT 2103.27 per agar tree, and undiscounted BCR considering total cost was 2.30. Financial viability of 1 acre of agar-wood plantations for the period of 12 years was found feasible with respect to net present value (NPV) BDT 552326.54, discounted benefit cost ratio (BCR) 2.07, internal rate of return (IRR) 23.7 per cent. Sensitivity analysis also suggested the viability of agar-wood production in different situations. The study revealed that agar-wood production is a highly feasible enterprise from which the farmers can enjoy economic benefits.