Estimating the economic efficiency in production and value chains of jaggery in Andhra Pradesh, India

An attempt has been made in this study to estimate the economic efficiency in production and value chains of jaggery in Andhra Pradesh. The objectives of the study are to work-out costs and returns involved in production of sugarcane and jaggery; to estimate the financial feasibility of jaggery production units; to analyse the price spread and efficiency in jaggery marketing; and to identify the major production and marketing constraints faced by jaggery producers. Multistage sampling technique was adopted to work-out various facets of production and value chains and constraints faced by cane jaggery producers during 2015–16. Cost concepts, Break Even Output (BEO), Payback Period, Producers Share in Consumers Rupee (PSCR), Response Priority Index (RPI), apart from Discounting techniques like Benefit Cost Ratio, Net Present Worth (NPW) and Internal Rate of Return (IRR) were employed to achieve the objectives. Prime factor in jaggery production was found to be cost of sugarcane. Jaggery is profitable (BCR=1.12) than supplying cane to factories (BCR=0.85). BEO is 40.14 tonnes with 72.98 days of PBP. PSCR and Marketing efficiency in Value chain I and II are 67.94, 73.10 and, 2.72 and 2.12 respectively. The major constraints in jaggery production and marketing are lack of infrastructural facilities and lack of transport facilities respectively.