Open AccessThe Feasibility Study of Palm Oil Replanting Using Chipping Technique
Author(s) -
Candra E. Ritonga,
Rulianda Purnomo Wibowo,
Satia Negara Lubis
Publication year - 2020
Publication title -
iop conference series. materials science and engineering
Language(s) - English
Resource type - Journals
eISSN - 1757-899X
pISSN - 1757-8981
DOI - 10.1088/1757-899x/851/1/012060
Subject(s) - payback period , palm oil , profitability index , productivity , palm , environmental science , agricultural engineering , sowing , net present value , agricultural science , business , production (economics) , engineering , agronomy , economics , finance , physics , quantum mechanics , macroeconomics , biology
This study aims to determine the feasibility of palm oil replanting using the chipping technique. The data were obtained through interview, observation and secondary data collection. The study is using NPV, Net B / C, IRR, Payback Period and sensitivity analysis for data analysis. The results indicate that the palm oil replanting using chipping technique is financially feasible to run. The results of the feasibility analysis show that the chipping technique generate financial benefits of Rp. 24,241,138 / ha per planting period with Net B/C ratio at 1.5. The payback period is 10 years and 7 months. This study also indicates that loan interest greater than 12.98% will not be feasible for palm oil plantation. The sensitivity analysis shows that the change in productivity has greater impact on profitability compared to the change in cost. Thus, palm oil plantation should focus on maintaining high level of crop productivity.