ECONOMIC VIABILITY ANALYSIS OF ORGANIC RICEPRODUCTION IN CENTRAL LUZON

The study is economic research that analyzed the economic viability of organic rice production of technology demonstration farms in Central Luzon. It employed financial analysis measures which includes payback period, return on investment, benefit-cost ratio (BCR), net present value and internal rate of return (IRR). All data on farm activities, amount of inputs used were recorded and computed for the total expenses and gross sales. The results of the study revealed that organic rice production is economically viable. The payback period ranges from five to seven years with two cropping seasons per year. The BCR was found to be more than 1 and with an IRR of more than the discount rate of 12%. Subjecting further for sensitivity analysis using a 10% decrease in sales and a 10% increase in production cost, organic rice production is still expected to be viable for 5 years of operation with mean BCR of more than 1.08 and mean IRR of 17%. Moreover, the breakeven point of yield and prices are far below than their obtained yield and market prices.