Feasibility and Economic Risk of Programmed Pruning Cycle in Arabic Coffee

Abstract

Coffee crop represents a great economic importance in Brazil, in which Arabica coffee represents a great part of the national production. However, the average yield of Arabica coffee is low, which reduces the profitability of the activity. Pruning systems can regain vigor and increase productivity. The system most adopted by coffee farmers is “recepa” (cutting off the orthotropic branch at 0.8 m above ground), which has not resulted in efficient reinvigoration. It is believed that the implementation of new systems, such as programmed pruning cycle, can improve the productivity of Arabica coffee. However, the economic impacts and risks associated with this type of pruning are still unknown. The objective of this study was to determine the feasibility and financial risk of the use of programmed pruning cycle compared to traditional Arabica pruning. A financial viability of programmed pruning cycle without Arabica coffee was determined by calculating the Net Present Value and the Internal Rate of Return. Using the sensitivity analysis, to identify the items with the greatest impact on the project. Finally, the financial risk of this technique was determined by the Monte Carlo method. The technical coefficient used for the elaboration of cash flows and is available by the Center for the Development of Agribusiness and the Capixaba Institute for Research, Technical Assistance and Rural Extension. The price data are available from the Coffee Trade Center of Vitória-ES and the Capixaba Institute for Research, Technical Assistance and Rural Extension. The reference year of the data of this work is 2017. A programmed pruning cycle is more economically feasible compared to traditional pruning. It was possible to identify the most sensitive items in pruning systems. The use of programmed pruning cycle of Arabica non-coffee is a practice with zero risk and economic yield.