Costs and profit analysis for owning and operating of some farm machinery in the Gezira scheme, Sudan

Abstract

Farm machinery cost is important issue for machinery management. Farmers in the Gezira scheme, Sudan owned several machinery types. Unfortunately, information about their costs and profitability is inadequate. This study aimed at analyzing costs and determining profit for machinery owned by farmers in the scheme. The required data was collected through questionnaire from machinery owners, it included tractor make and implements type, purchase price, annual covered area and work rate. In addition to variable cost items, customer rental rate and driver wage. Ten implements were studied namely; disk plow, chisel plow, moldboard plow, disk harrow, scraper, ridger, ditcher, row planter, seed drill and sprayer. Costs and profit were calculated by using standard procedures. The results showed variations in fixed cost amongst implement. Moldboard plow and scraper obtained the highest and the lowest fixed costs, respectively. The percentage of fixed cost for implement and tractor was between 11% and 28% from total operation cost. Fuel and driver costs were the highest amongst variable cost items, they represented more than 50% of total variable cost. Disk plow and sprayer obtained the highest and lowest total operation cost, respectively. All of the studied implements were profitable and their benefit cost ratio was between 1.5 to 2.7. Row planter and moldboard obtained the highest and the lowest annual net return, respectively. The profitability of machinery in the Gezira scheme may encourage farmers to invest in other machinery types.

Keywords: Mechanized farm operations, fixed cost, variable cost, benefit cost ratio, private farmers.