IDEAS home Printed from https://ideas.repec.org/a/ibn/masjnl/v10y2016i7p22.html
   My bibliography  Save this article

Economic Valuation of Oil Palm Plantation Investment in Swamp Area of Tapin Regency, South Kalimantan, Indonesia

Author

Listed:
  • Hamdani Hamdani

Abstract

This study describes the companies’ feasibility determination on oil palm plantation investment. We also compare it with the oil palm plantation in swamp area, by considering economic, social and environmental aspects. We used total valuation method to valuing the environmental value of swamp area. Otherwise, investment analyzed by the model of benefit cost ratio (BCR), net present value (NPV), and internal rate of return (IRR). The study showed that the financial valuation of investment feasibility that is made and proposed by the plantation companies to banks (creditors), did not account the land value (economic, social and environmental values) of swamp ecosystems. The assessment on swampland value obtained Rp232, 570,833,400 or US$24,481 million per year for 10,000 ha area – US$2,448 per ha each year. Although the total value of economic environment is included in the valuation element of oil palm plantation investment in swampland, it still result insufficient value. However, by sensitivity analysis scenario of swampland plantation would become sufficient if the Crude Palm Oil (CPO) price is above US$1300 per ton. It also has a second scenario if the environmental cost can be pressed optimally into Rp9, 025,541 or US$950 per ha per year.

Suggested Citation

  • Hamdani Hamdani, 2016. "Economic Valuation of Oil Palm Plantation Investment in Swamp Area of Tapin Regency, South Kalimantan, Indonesia," Modern Applied Science, Canadian Center of Science and Education, vol. 10(7), pages 1-22, July.
    • Handle: RePEc:ibn:masjnl:v:10:y:2016:i:7:p:22
    as

    Download full text from publisher

    File URL: https://ccsenet.org/journal/index.php/mas/article/download/54156/31839
    Download Restriction: no
    File URL: https://ccsenet.org/journal/index.php/mas/article/view/54156
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Soderqvist, Tore & Mitsch, William J. & Turner, R. Kerry, 2000. "Valuation of wetlands in a landscape and institutional perspective," Ecological Economics, Elsevier, vol. 35(1), pages 1-6, October.
    2. Scott M. Swinton & Frank Lupi & G. Philip Robertson & Douglas A. Landis, 2006. "Ecosystem Services from Agriculture: Looking Beyond the Usual Suspects," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(5), pages 1160-1166.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Qenani-Petrela, Eivis & Noel, Jay E. & Mastin, Thomas, 2007. "A Benefit Transfer Approach to the Estimation of Agro-Ecosystems Services Benefits: A Case Study of Kern County, California," Research Project Reports 121605, California Polytechnic State University, San Luis Obispo, California Institute for the Study of Specialty Crops.
    2. Kwayu, Emmanuel J. & Sallu, Susannah M. & Paavola, Jouni, 2014. "Farmer participation in the equitable payments for watershed services in Morogoro, Tanzania," Ecosystem Services, Elsevier, vol. 7(C), pages 1-9.
    3. Tamini, Lota D., 2011. "A nonparametric analysis of the impact of agri-environmental advisory activities on best management practice adoption: A case study of Québec," Ecological Economics, Elsevier, vol. 70(7), pages 1363-1374, May.
    4. Barrios, Edmundo, 2007. "Soil biota, ecosystem services and land productivity," Ecological Economics, Elsevier, vol. 64(2), pages 269-285, December.
    5. Wainger, Lisa A. & King, Dennis M. & Mack, Richard N. & Price, Elizabeth W. & Maslin, Thomas, 2010. "Can the concept of ecosystem services be practically applied to improve natural resource management decisions?," Ecological Economics, Elsevier, vol. 69(5), pages 978-987, March.
    6. Dominati, Estelle & Patterson, Murray & Mackay, Alec, 2010. "A framework for classifying and quantifying the natural capital and ecosystem services of soils," Ecological Economics, Elsevier, vol. 69(9), pages 1858-1868, July.
    7. Marie Perennes & C. Sylvie Campagne & Felix Müller & Philip Roche & Benjamin Burkhard, 2020. "Refining the Tiered Approach for Mapping and Assessing Ecosystem Services at the Local Scale: A Case Study in a Rural Landscape in Northern Germany," Land, MDPI, vol. 9(10), pages 1-23, September.
    8. Reich, Denis Andrew, 2007. "Evaluating the Conservation Security Program utilizing the perceptions and economics of producer participation: implications for land stewardship in Iowa agriculture," ISU General Staff Papers 2007010108000016024, Iowa State University, Department of Economics.
    9. Wang, Jingjing, 2022. "Harnessing natural attenuation to reduce CAFOs nitrate emissions: An integrated modeling approach," Ecological Economics, Elsevier, vol. 199(C).
    10. Scheufele, Gabriela & Bennett, Jeffrey W., 2008. "Environmental value and valuation over time," Research Reports 94805, Australian National University, Environmental Economics Research Hub.
    11. Zhendong Hong & Qinghe Zhao & Jinlong Chang & Li Peng & Shuoqian Wang & Yongyi Hong & Gangjun Liu & Shengyan Ding, 2020. "Evaluation of Water Quality and Heavy Metals in Wetlands along the Yellow River in Henan Province," Sustainability, MDPI, vol. 12(4), pages 1-19, February.
    12. Hamdani Hamdani & Imam Hanafi & Anwar Fitrianto & Lutfhi Fatah Arsyad & Budi Setiawan, 2013. "Economic-Ecological Values of Non-Tidal Swamp Ecosystem: Case Study in Tapin District, Kalimantan, Indonesia," Modern Applied Science, Canadian Center of Science and Education, vol. 8(1), pages 1-97, February.
    13. Kragt, Marit E. & Robertson, Michael J., 2014. "Quantifying ecosystem services trade-offs from agricultural practices," Ecological Economics, Elsevier, vol. 102(C), pages 147-157.
    14. Kato Van Ruymbeke & Joana G. Ferreira & Vasileios D. Gkisakis & Jochen Kantelhardt & Gordana Manevska-Tasevska & Peter Matthews & Andreas Niedermayr & Lena Schaller & Katarzyna Bańkowska & Kewan Merte, 2023. "Assessing the Impact of Farm-Management Practices on Ecosystem Services in European Agricultural Systems: A Rapid Evidence Assessment," Sustainability, MDPI, vol. 15(17), pages 1-24, August.
    15. Wim van de Griendt, 2004. "A law & economics approach to the study of integrated management regimes of estuaries," Law and Economics 0408002, University Library of Munich, Germany.
    16. Jolejole, Christina B. & Swinton, Scott M. & Lupi, Frank, 2009. "Incentives to Supply Enhanced Ecosystem Services from Cropland," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49356, Agricultural and Applied Economics Association.
    17. Borner, Jan & Mendoza, Arisbe & Vosti, Stephen A., 2007. "Ecosystem services, agriculture, and rural poverty in the Eastern Brazilian Amazon: Interrelationships and policy prescriptions," Ecological Economics, Elsevier, vol. 64(2), pages 356-373, December.
    18. Rina Nuryati & Lies Sulistyowati & Trisna Insan Noor & Iwan Setiawan, 2024. "Innovation for development of sustainable integrated plantation polyculture on dry land: Using Structural Equation Modelling," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 70(6), pages 291-308.
    19. Azad, M.A. Samad & Ancev, Tihomir, 2020. "Assessing the dynamics of natural capital on farms: A soil natural capital indicator," Ecological Economics, Elsevier, vol. 168(C).
    20. Ruymbeke, Kato Van & Ferreira, J. & Gkisakis, V. & Kantelhardt, J. & Tasevska, G. Manevska & Matthews, P. & Niedermayr, A. & Schaller, L. & Zawalinska, K. & Mertens, Kewan & Vranken, Liesbet, 2021. "Assessing Environmental Performance of Agricultural Practices in Europe Using Ecosystem Services: An Environmental Performance Indicator Approach," 2021 Conference, August 17-31, 2021, Virtual 315242, International Association of Agricultural Economists.

    More about this item

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ibn:masjnl:v:10:y:2016:i:7:p:22. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Canadian Center of Science and Education (email available below). General contact details of provider: https://edirc.repec.org/data/cepflch.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.