Financial performance and potential feasibility of black rice (Oryza sativa L. indica) cultivation in Assam: An empirical study Hazarika Bidyutt Bikash1,*, Chakraborty Deb Kumar2 1Department of Economics, Sibsagar College, Joysagar (Autonomous), Dibrugarh University, Assam, India 2Department of Economics, Dibrugarh University, Assam, India *Corresponding author: hazarikabidyutt@gmail.com (ORCID ID: 0000-0002-5016-202X)
Online published on 15 July, 2024. Abstract This paper explores the economic and financial performance of black rice production in the upper Brahmaputra valley region of Assam. Black rice, known for its rich nutritional value and cultural significance, has gained attention from agri-entrepreneurs and development projects aiming to promote its cultivation. The study employs various accounting ratios, such as gross profit ratio, profit-volume ratio, and expenses ratio, to assess the profitability and financial health of black rice farmers in three different categories based on farm size. Through a comprehensive analysis of primary data collected from 170 farmers, the study reveals that category C farmers, with the largest farm size, achieve the highest average gross profit and gross profit ratio, followed by category B and category A. Similarly, category C farmers incur higher expenses on machinery and fertilizers but maintain the lowest expense ratio. Conversely, category A farmers have the highest expense ratio but achieve the lowest average gross profit and profit volume ratio. Break-even analysis and margin of safety are employed to understand the profitability and financial strength of black rice farmers. The study finds that category C farmers have the highest break-even point and the highest margin of safety ratio, followed by category B and category A. The research concludes that black rice cultivation holds immense potential for economic growth and livelihood improvement in Assam. However, despite favorable agro-climatic conditions, commercial production remains limited. Further research is needed to understand the barriers to scale up production and promote the systematic adoption of black rice cultivation to achieve nutritional security and enhance livelihoods in the region. Highlights • This study aims to assess economic and financial performance of black rice production in Assam. • Study employs various accounting ratios (gross profit ratio, profit-volume ratio, and expenses ratio) to assess profitability and financial health of black rice farmers in three farm size categories. • Black rice cultivation shows potential for economic growth and livelihood improvement in Assam. Top Keywords Black rice, Financial Performance, Feasibility, Profitability, Break even. Top |