Production and Financial Feasibility in Silvopastoral System in Small Rural Property

Abstract

The implementation of silvopastoral systems (SPS) on properties that have family farming is an alternative to diversify land use, to acquire more than one production good, and diversify income generation. Therefore, the objective of this study was to evaluate the financial viability and quantify the volume of the forest component in an SPS with a spacing of 3.0 m x 20.0 m for multiple uses, carried out at 4 years of age for a 16-year rotation. For the analysis of financial viability, we used project analysis criteria such as: net present value (NPV), internal rate of return (IRR), and benefit-cost ratio (BCR) for a 16-year horizon with rate benchmarks interest rate of 3%, 4.5% and 10%. Based on the financial analysis criteria, the tree component of the system is viable, as it presented an NPV greater than zero, IRR exceeding the minimum attractiveness rate and BCR greater than 1 for all rates analyzed. The estimated production of the forest component was 257.28 m3/ha in 16 years. Thus, it can be concluded that the forest component in the arrangement of 3.0 m x 20.0 m at 16 years of age, provides a financial return for the small rural property. Therefore, it is a system that brings several economic and environmental advantages, optimizing the use of land, diversifying the production of the small property, generating income, bringing benefits to the reduction of methane gas (CH4) emissions, and assists in carbon sequestration (CO2).

Economic-environmental assessment of silvo-pastoral systems in Colombia: An ecosystem service perspective

“…Braun et al [ 64 ], in a summary on SPS for South America, conclude that SPS are economically attractive alternatives, which allow for deriving different products (e.g., timber, beef, milk, fruits) at different times, and that the inclusion of trees results in a more secure long-term income while the beef component is more oriented towards short-term incomes. Other authors, such as da Silva Santos and Grzebieluckas [ 100 ] for Matto Grosso in Brazil, Quaresma Maneschy et al [ 101 ] for Pará in Brazil, Alonzo [ 102 ] for Belize, Boscana et al [ 103 ] for Uruguay, Rade et al [ 104 ] for Ecuador, Ramírez-Martínez and Salas-Razo [ 105 ] for Michoacan in Mexico, and Bernardy et al [ 106 ] for Brazil, have also provided insights into the financial viability of different SPS setups in Latin America, evidencing positive results in most cases.…”