Market Opportunities and Profitability of Tree Crop Planting in Nigeria

Abstract

Investing in trees offer financial and social returns for years to come and it is a lucrative long-term investment in Nigeria. Despite the substantial gain on investment in tree planting, only few people are still involved in the business. This paper analyzed the profitability of investment in tree crop planting for income generation. Benefit Cost Ratio (BCR) and Net Present Value (NPV) were calculated to determine the financial viability of tree crop planting. The study showed that tree crop planting is a profitable business as shown by positive NPV of ₦2,187,822.0 and N2, 782,214.97 for Tectonia grandis and Moringa oleifera plantations respectively, after 10-years of maturation and harvesting at 14 % discount rate with a B/C Ratio of 1.97 and 1.6 respectively. Also, NPV of N1, 575,487.10 for a 5-year small scale private nursery establishment with a B/C Ratio of 2.79 at a 14% discount rate also confirm that the investment on nursery establishment is highly profitable. It is recommended that with adequate support and incentives, farmers can take advantage of these opportunities and invest in nursery enterprise and tree crop sub-sector of the economy

Keywords: Market opportunities, Tree planting, BCR, NPV